FCA reveals state, federal probes over emissions

Fiat Chrysler Automobiles NV has received subpoenas from US federal and state authorities, including the Securities and Exchange Commission, related to alleged excess diesel emissions by some of its vehicles, the automaker revealed in a filing with the SEC on Tuesday.

On the diesel emissions issue, FCA said it has “received various inquiries, subpoenas and requests for information from a number of governmental authorities, including the US Department of Justice, the SEC and several states’ attorneys general. We are investigating these matters and we intend to cooperate with all valid governmental requests,” FCA said in its annual report filed on Tuesday with the SEC.

Earlier in February, a person briefed on the matter said the Justice Department has been involved in the matter for more than six months after getting a referral from the Environmental Protection Agency in July 2016. Involvement by the SEC and state attorneys general has not been previously disclosed.

FCA said January 12 that the Justice Department was investigating the matter.

The same day, FCA Chief Executive Sergio Marchionne rejected the allegations, saying there was no wrongdoing and the company never attempted to create software to cheat emissions rules by detecting when the vehicle was in test mode.

FCA in its annual report said it is not able to predict the outcome of the investigations, but disclosed that “the resolution of these matters could have a material adverse effect on our financial position, results of operations or cash flows and may adversely affect our reputation with consumers, which may negatively impact demand for our vehicles.”

In January, the EPA said the maximum possible fine against FCA could be $4.6 billion.

FCA also is facing scrutiny of its emissions compliance from European regulators. The French government said earlier this month that its Consumer Protection Agency had asked a prosecutor to investigate FCA’s diesel vehicles.

The focus FCA top management must pay to regulatory intervention “may divert attention from other key aspects of our business plan” and may require more recalls of vehicles.

In July 2016, FCA confirmed that the SEC and the Justice Department is investigating its US vehicle sales reporting.

Soon after that confirmation, FCA revised more than five years of monthly US vehicle sales figures to reflect a new reporting method.