Court to appoint VW monitor
When Volkswagen is sentenced in the US on Friday for rigging emissions tests, it will get a court-approved monitor to make sure it stays in its lane.
When Volkswagen (VW) is sentenced in the US on Friday for rigging emissions tests, it will get a court-approved monitor to make sure it stays in its lane.
That person, according to two sources familiar with the matter, is a former chief of Washington’s Enron prosecution who more recently served as chief counsel for PepsiCo.
Larry Thompson, a deputy attorney-general under George W Bush, was chosen by the company for the three-year post and accepted by the US justice department, said the sources, who asked not to be named because the choice had not been made public.
Thompson will oversee the vehicle maker’s compliance with the justice department’s settlement agreement and make sure the company is following through with a consent decree in a huge civil resolution with consumers and states in federal court in California.
VW and the justice department declined to comment.
Thompson did not immediately respond to messages seeking comment.
CHEATING SCANDAL
Choosing a monitor is one of the final pieces to fall into place as VW tries to put the US criminal emissions case behind it. The company admitted in 2015 that about 11-million diesel cars worldwide were outfitted with defeat devices, which allowed the vehicles’ onboard computers to lower emissions when they detected test conditions.
VW reported higher-thanexpected first-quarter earnings on Tuesday, fuelled by a comeback of the company’s namesake brand. The updated Tiguan sport utility vehicle and cost reductions helped the VW brand generate a margin of about 3.5%, according to an estimate from Evercore ISI.
In 2002, Thompson was chosen to lead the department of justice’s corporate fraud task force, which included its investigation into Enron. During his stint as deputy attorney-general, Thompson contended with a spate of corporate scandals, including Arthur Andersen and WorldCom.
Faced with increasing evidence of wrongdoing in corporate America, he issued a memorandum to federal prosecutors saying that corporate defendants could earn points for co-operation only if they voluntarily waived their attorneyclient privileges and stopped paying for their employees’ legal representation.
CONTROVERSY
The Thompson Memorandum, as it became known, stirred up controversy and was rolled back a few years later after a federal judge in 2006 ruled that the department’s prosecution of auditing firm KPMG had violated the rights of several KPMG employees. Following that, the government issued a new set of guidelines, backing away from the controversial parts of the Thompson Memorandum.