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The Trials of VW Executives Continue

A Volkswagen AG compliance executive has pled not guilty to charges that he helped the automotive company cheat on its emissions standards. Oliver Schmidt was arrested in the United States last month and told a judge this week that he did not commit fraud or conspiracy.

Five other VW executives have also been indicted by US authorities. But they live in Germany and they are protected from extradition, reports Bloomberg.

Volkswagen agreed last month to pay $4.3 billion in penalties and to plead guilty to using false statements to import cars in the U.S. and to obstructing investigations, the news service adds. The company is also scheduled to enter the plea in federal court in Detroit March 10, it says.

In September 2015, VW admitted to fixing about 11 million diesel vehicles around the globe with software devices that could rig the emissions results. It has already paid $23 billion to buy back those cars, or to repair them. It’s the biggest scandal in North America’s history, says Bloomberg.

But its problems are not limited to North America, where it still faces civil lawsuits from investors and others. They also extend to Germany, where criminal proceedings are expected to take place. Among the targets of the investigation there: former CEO Martin Winterkorn, who says he knew nothing about the scandal.

The episode has its roots in 2006, when the car maker is alleged to have tried to fool U.S. regulators into the thinking its clean diesel engines could meet federal emissions standards, says Bloomberg. It then used those claims to sell more vehicles to unsuspecting buyers, who thought their cars to be cleaner than others on the market.

“When VW couldn’t design an engine that met the new standards, company executives authorized the creation of a so-called defeat device — software that detected when the vehicle was undergoing testing and switched to more effective emissions controls,” U.S. prosecutors said, according to Bloomberg.
The plan started to unravel in 2014, however, when West Virginia University professors detected that the emissions results didn’t match up with the claims.
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