4 Audi managers indicted in U.S. emissions probe

Friday, January 18, 2019 - 08:23
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The U.S. Department of Justice indicted four employees of Audi for their alleged roles in a conspiracy to skirt U.S. emissions tests for model year 2009-15 Audi vehicles equipped with a 3.0-liter diesel engine and sold in the United States.

The indictments were filed Thursday in U.S. District Court in Detroit. A spokesman for the court said hearings in the case have not been set.

Indicted were Richard Bauder, the former head of Audi’s diesel engine development department in Neckarsulm, Germany; Axel Eiser, head of Audi’s engine development division in Ingolstadt, Germany, in 2008-13; Stefan Knirsch, who succeeded Eiser in Ingolstadt in 2013 but left the company in 2016; and Carsten Nagel, head of engine registration in Neckarsulm.

Each of the four men is charged with multiple felonies, including conspiracy to defraud the U.S. government, violation of the Clean Air Act and wire fraud. None are in custody in the United States, and the German constitution protects German nationals from extradiction to the U.S.

Other German nationals remain under active indictment in the U.S. for their alleged roles in Volkswagen Group’s diesel emissions violations, including former VW Group CEO Martin Winterkorn. Audi is a unit of VW Group.

Lawyers for the four could not immediately be identified.

The government previously indicted one former Audi manager in July 2017, Giovanni Pamio, but the new indictments are a significant expansion of the government’s criminal probe.

Volkswagen spokesman Pietro Zollino said the company continues “to cooperate with investigations by the Department of Justice into the conduct of individuals. It would not be appropriate to comment on individual cases.”

Volkswagen has agreed to pay more than $25 billion in the United States for claims from owners, environmental regulators, states and dealers, and has offered to buy back about 500,000 polluting U.S. vehicles. The buybacks will continue through 2019.

In 2017, VW also pleaded guilty to fraud, obstruction of justice and falsifying statements in a U.S. court. Under the plea deal, the automaker agreed to sweeping reforms, new audits and oversight by an independent monitor for three years.

Two other former VW executives have pleaded guilty in the investigation and are in prison.

Former Audi CEO Rupert Stadler was not among those indicted. He is being investigated in Germany for his alleged role. VW in October terminated Stadler’s contract against the backdrop of a criminal investigation into whether he helped skirt emissions tests.

The indictments cover the design and later certification of five Audi models – the 2009-15 Q7 crossover, 2014-15 A6 and A7 Quattro sedans, the 2014-15 A8L sedan and the 2014-15 Q5 crossover – as well as the 2009-15 Volkswagen Touareg, all equipped with a 3.0-liter turbodiesel engine.

The defendants are charged with installing defeat devices in the engine’s emissions control software that altered engine performance when it was under testing, and allowing vehicles to emit levels of NoX and other pollutants far in excess of federal standards when the vehicles were in normal operation.

Among the most damning revelations in the indictment, U.S. prosecutors allege why Audi’s engine development engineers cheated on the emissions testing for the higher-end 3.0-liter turbodiesel.

The indictment alleges engineers had warned their superiors that the vehicles needed larger tanks of AdBlue Diesel Emission Fluid, or DEF, to properly dose the engines and comply with emissions regulations. But larger on-board DEF tanks conflicted with other program requirements imposed by Audi, including mandates that the vehicles have a “10,000 mile [DEF] refilling interval,” as well as a “large trunk and high-end sound system.”

Each of the four men were charged with one count of conspiracy to defraud the United States. To commit wire fraud, and to violate the Clean Air Act. In addition, each was charged with two counts of making false statements in violation of the Clean Air Act. Eiser also was charged with three counts of wire fraud, while the other three defendants each were charged with two counts of wire fraud, according to the indictment.

Source: Automotive News Europe

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