Mon. May 20th, 2019

Cash cow? After paying billions in fines Volkswagen accused by US stock regulator of ‘massive fraud’

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The US Securities and Exchange Commission (SEC) has filed a complaint against Volkswagen (VW), accusing the German automating giant and its former CEO Martin Winterkorn of defrauding US investors by cheating on emissions tests.

The commission is charging the world’s second biggest car manufacturer of “reaping hundreds of millions of dollars in benefit by issuing the securities at more attractive rates for the company,” according to the document filed in San Francisco on Thursday.

Volkswagen, Europe’s largest automating concern, has called the step “legally and factually flawed,” vowing to “vigorously contest” the complaint.

Also on FBI arrests ex-Volkswagen official on fraud charges in diesel emissions probe – report

“Regrettably, more than two years after Volkswagen entered into a landmark, multibillion-dollar settlement in the United States with the Department of Justice, almost every state and nearly 600,000 consumers, the SEC is now piling on to try to extract more from the company,” a spokesperson said in a statement.

The long-standing “Dieselgate” scandal traces back to 2015, when the US Environmental Protection Agency (EPA) caught the Volkswagen Group cheating on emissions tests. The agency found discrepancies in several models of four-cylinder diesel vehicles manufactured since 2009, including the Jetta, Beetle, Golf, Passat and the Audi A3.

The company, which owns Audi, Bentley, Bugatti, Lamborghini, Porsche, SEAT, and Skoda brands, admitted using sophisticated software installed in as many as 11 million diesel vehicles sold worldwide.

Also on VW executive faces 7 years in US prison over diesel emissions scandal

The scandalous case that forced the company’s CEO Martin Winterkorn to resign has reportedly cost the automaker €29 billion ($32.8 billion) so far.

The latest suit is seeking to ban the former VW chief from serving as an officer or director of a public US company and recover “ill-gotten gains” along with civil penalties and interest. The SEC says VW issued more than $13 billion in bonds and asset-backed securities in US markets from April 2014 to May 2015.

For more stories on economy & finance visit RT’s business section

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