National Post (National Edition)
SECOND VW WORKER ARRESTED OVER EMISSIONS SCHEME.
ACCUSED OF DECEIVING OFFICIALS ON EMISSIONS TESTS
DETROIT •The Volkswagen AG executive who once was in charge of complying with U.S. emissions regulations was arrested during the weekend in Florida and accused of deceiving federal regulators about the use of special software that cheated on emissions tests.
Oliver Schmidt, who was general manager of the engineering and environmental office for VW of America, was charged in a criminal complaint with conspiracy to defraud the U.S. government and wire fraud.
Schmidt is the second VW employee to be arrested as part of an ongoing federal investigation into the German automaker, which has admitted that it programmed diesel-powered vehicles to turn pollution controls on during tests and to turn them off in realworld driving. The scandal has cost VW sales and has tarnished its brand worldwide.
He faced an initial hearing in Miami Monday afternoon and likely will be taken to Detroit, where the Justice Department investigation is based, to face arraignment at a later date. It wasn’t immediately clear if he had a lawyer.
The complaint, dated Dec. 30, says Schmidt in 2015 misled regulators who asked why Volkswagen vehicles emitted higher emissions on the road than during tests.
Schmidt “offered reasons for the discrepancy” other than the fact that the company was cheating on emissions tests through illegally installed software on its diesel vehicles, according to court documents.
The complaint says Schmidt and other VW executives conspired to violate the U.S. Clean Air Act by making false representations about the environmental quality of their cars.
Tests commissioned by the non-profit International Council on Clean Transportation in 2014 found certain Volkswagen models with diesel engines emitted more than the allowable limit of pollutants. More than a year later, Volkswagen admitted to installing the software on about 500,000 2-litre diesel engines in VW and Audi models. It later said some 3-litre diesels also cheated.
After that study, Schmidt, in an apparent reference to VW’s compliance with emissions, wrote a colleague to say, “It should first be decided whether we are honest. If we are not honest, everything stays as it is.”
He later emailed another executive with an analysis that listed possible monetary penalties from the Environmental Protection Agency.
“Difference between street and test stand must be explained. (Intentpenalty),” Schmidt wrote, according to the complaint.
Schmidt’s bio for a 2012 auto industry conference said he was responsible for ensuring that vehicles built for sale within the U.S. and Canada comply with “past, present and future air quality and fuel economy government standards in both countries.” It says he served as the company’s direct factory and government agency contact for emissions regulations. The criminal complaint says Schmidt was promoted in 2015 as a principal deputy of a senior manager.
Volkswagen said in a statement Monday it is cooperating with the Justice Department. “It would not be appropriate to comment on any ongoing investigations or to discuss personnel matters.”
Herbert Diess, a member of Volkswagen AG’s board of management, appeared in Detroit Sunday evening to introduce a new version of VW’s Tiguan SUV ahead of the North American International Auto Show. He wouldn’t comment when asked if some VW executives refused to come to the auto show for fear of being arrested.
Asked about the Justice Department investigation, Diess also wouldn’t comment, but said he hopes it’s resolved “as soon as possible.”
The company has agreed to either repair the cars or buy them back as part of a US$15-billion settlement approved by a federal judge. VW agreed to pay owners of 2-litre diesels up to US$10,000 depending on the age of their cars.
In October, VW engineer James Robert Liang, of Newbury Park, Calif., pleaded guilty to one count of conspiracy to defraud the government and agreed to co-operate with investigations in the U.S. and Germany.