Germany charges VW bosses over diesel emissions scandal
BERLIN — German prosecutors dealt a blow to Volkswagen’s efforts to put the 2015 emissions-cheating case behind it, charging the automaker’s chief executive, chairman and former CEO with stock manipulation for not telling investors at the time that the scandal was about to break.
The charges announced Tuesday could pose a major distraction for CEO Herbert Diess as he pushes ahead with the company’s shift toward zero-emissions vehicles and a new, more environmentally friendly image.
Diess, Chairman Hans Dieter Poetsch and former CEO Martin Winterkorn were accused of deliberately informing markets too late about the huge costs to VW that would result from the scandal, which erupted when regulators discovered that millions of diesel cars had been fitted with software designed to thwart pollution tests.
Winterkorn was previously charged in the scandal. Poetsch and Diess had not faced charges until now.
Volkswagen called the new allegations “groundless” and threw its support behind Poetsch and Diess. But the case could require Diess to spend time on his defense at a crucial time for the company.
Just days ago, Diess stood on stage at the Frankfurt Motor Show with the company’s new battery-powered vehicle, the ID.3, and showed off a new version of the VW logo to underscore the automaker’s transformation.
The new car is aimed at bringing zero-emissions driving to the masses. The vehicle is supposed to be carbon-dioxide neutral throughout its production chain.
Tido Park, a lawyer for Diess, told German news agency dpa that the indictment won’t prevent Diess from performing his duties as CEO.
Prosecutors said Winterkorn knew of the impending scandal and the potential financial damage since at least May 2015, Poetsch since late June of that year, and Diess since late July, less than a month after he became head of the company’s VW brand.
The scandal broke when the U.S. Environmental Protection Agency went public with it in mid-September 2015. That led to a drop in the automaker’s stock.
The charges could bring up to five years in prison, authorities said.
Winterkorn resigned shortly after the scandal erupted. Poetsch was chief financial officer at the time and became chairman in late 2015. Winterkorn was succeeded as CEO by Matthias Mueller, who was then replaced by Diess in April 2018.
Volkswagen stock fell about 2 percent after the news.
Volkswagen called the new allegations Tuesday against VW Chairman Hans Dieter Poetsch, left, former CEO Martin Winterkorn and CEO Herbert Diess “groundless.”