US indicts six as Volkswagen agrees to $4.3 billion diesel settlement

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Volkswagen AG has agreed to pay the largest ever US criminal fine levied on an automaker to settle charges that it conspired for nearly 10 years to cheat on diesel emission tests, while prosecutors on Wednesday charged six current and former senior VW executives for their roles in the scheme.

The German automaker agreed on Wednesday to pay 4.3 billion US dollars in US civil and criminal fines and pay California 153.8 million US dollars.

In total, VW has now agreed to spend up to 22 billion US dollars in the United States to address claims from owners, environmental regulators, US states and dealers.

This file photo taken on June 28, 2016 shows Volkswagen cars at a dealership in Los Angeles, California. /CFP Photo

Among those indicted was Heinz-Jakob Neusser, former head of development for VW Brand, who was suspended in 2015. He was also previously head of engine development. Two other former heads of engine development, Jens Hadler and Richard Dorenkamp, were also indicted.

"It is now clear that Volkswagen's top executives knew about this illegal activity and deliberately kept regulators, shareholders and consumers in the dark - and they did this for years," said Andrew McCabe, the FBI's deputy director, at a press conference.

"We can't put companies in jail but we can hold their employees personally accountable. We can force companies to pay hefty fines."

Five of the six current and former Volkswagen executives are in Germany and it is unclear if they will come to the United States to face charges since Germany typically does not extradite its citizens.

The indictment said the executives engaged in a 10-year conspiracy to cheat US emissions tests and then cover up the excess emissions even as regulators questioned irregularities.

The Justice Department said that in 2006 VW realized it could not meet the tougher rules and VW engineers designed a system to detect when cars were being tested in the lab and then to emit up to 40 times legally allowable pollutants when driven.

VW executives destroyed documents and other evidence in an attempt to avoid detection, the Justice Department said.

A Volkswagen Passat diesel vehicle that is fitted with research instruments is shown in this West Virginia University photo released to Reuters on November 4, 2015. /CFP Photo‍

Volkswagen Chief Executive Officer Matthias Mueller said in a statement the company "deeply regrets the behavior that gave rise to the diesel crisis" and vowed to continue changes in how the company operates.

One of the six charged, Oliver Schmidt, who was a manager in charge of VW's environmental and engineering office in Michigan, was arrested in Florida on Saturday. He faces a hearing on Thursday in Miami to determine if he should remain jailed before trial.

A seventh VW employee pleaded guilty in September and agreed to cooperate.

VW will pay a 1.5 billion US dollars civil fine and 2.8 billion US dollars criminal fine. It will not be required to make any additional restitution payments.

The deal surpasses the 1.2 billion US dollars fine Toyota Motor Corp paid in 2014 for concealing safety defects from US regulators.

VW admitted in September 2015 to installing secret software in hundreds of thousands of US diesel cars to cheat exhaust emissions tests and make them appear cleaner than they were on the road, and that as many as 11 million vehicles could have similar software installed worldwide.

Volkswagen, which may have topped Toyota in 2016 as the world's largest automaker, is eager to move past the scandal and focus on introducing new vehicles for the US market. Volkswagen, which may have topped Toyota in 2016 as the world's largest automaker, is eager to move past the scandal and focus on introducing new vehicles for the US market.

(Story by Reuters)