May 08, 2018

After the VW scandal, consequences are underway

located:	USA, Germany
editor:	Shira Jeczmien

Just days after the Volkswagen Diesel rigging scandal emerged to the public in 2015, then CEO Martin Winterkorn resigned from his role—a position he had championed for nearly a decade—saying he was “stunned” by the revelations of the cheating devices used by the company and claiming he was “not aware” of any misconduct within the company. Last week, on May 5, almost three years after the scandal broke, Winterkorn is being charged with conspiracy to defraud the U.S. and violation of the Clean Air Act, facing 25 years imprisonment.

Although the indictment against Winterkorn is unlikely to be charged, as Germany does not usually extradite its citizens outside of the European Union, this nonetheless marks a giant step forward in the U.S. justice system and the Environmental Protection Agency’s fight to maintain the Clean Air Act. Between 2009 and 2015, the company sold close to 11 million “Clean Diesel” vehicles until the EPA issued a violation of the act to the company when it had discovered that Volkswagen had rigged its cars with “defeat devices”. This cheating programme ensured that the Clean Diesel cars activated their emission control during standardised testing environments, subsequently allowing the vehicles’ NOx emission to meet the U.S. standards and remain within the Clean Air Act guidelines. However, once out on the road, the vehicles emitted up to 40 times more, spiking their pollution above the legal limit and producing noxious NOx on a monumental scale. Volkswagen has since paid $26 billion in fines, civil damages and compensation to millions of consumers and it is now facing another $10 billion lawsuit by its stakeholders.

Shortly after the publication of the charge against Winterkorn, the U.S. offered an apparently rare safe-passage to his successor, CEO Herbert Diess. And while it is unlikely this indictment will go through, what has happened, in turn, is a backlash in Germany. Politicians from Angela Merkel’s governing coalition, as well as opposition lawmakers saw the U.S. charge as a nudge in their direction, “saying Winterkorn should face punitive actions in Germany for creating a culture at the automaker that allowed such a scandal to take place” as reported by Bloomberg.

The momentum for Germany to pursue charges against Winterkorn and the company must be continued by the media, environmental agencies and activists. This case is only at the beginning of its journey as many of the parties involved have not yet faced the rightful charges for their participation in one of the biggest corporate fraud cases in recent history and an evident disregard for global measures against pollution. In the meantime Volkswagen is also pursuing possible clawbacks against Winterkorn.

In the race to charge the former leader of the company, German as well as U.S. prosecutors should be reminded that this is not an operation of one man, and that Volkswagen as a global company has developed, endorsed and spread the very concept of “cheating devices”; mechanisms that seemingly lower emission while in reality contribute to the pollution of almost double the amount of standard petrol. The NOx spread in the air by this army of Clean Diesels is already out there, creating irreversible damage. Indeed the captain of this operation should (and must) be prosecuted, but in order to leave long lasting marks, his former company must be too.