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FRANKFURT (Reuters): Volkswagen Chief Executive Herbert Diess was told about the existence of cheating software in cars two months before regulators blew the whistle on a multi-billion exhaust emissions scandal, German magazine Der Spiegel said.
Der Spiegel’s story, based on recently unsealed documents from the Braunschweig prosecutor’s office, raises questions about whether VW informed investors in a timely manner about the scope of a scandal which it said has cost it more than $ 27 billion in penalties and fines.
Volkswagen’s senior management, which has denied wrongdoing, is being investigated by prosecutors in Braunschweig, near where Volkswagen is headquartered, to see whether the company violated disclosure rules.
US regulators exposed VW’s cheating on 18 September 2015.
Responding to the magazine report, the carmaker reiterated on Saturday that the management board had not violated its disclosure duties and had not informed investors earlier because they had failed to grasp the scope of the potential fines and penalties.
Citing documents unsealed by the Braunschweig prosecutor’s office, Der Spiegel said Diess was present at a meeting on 27 July 2015 when senior engineers and executives discussed how to deal with US regulators, who were threatening to ban VW cars because of excessive pollution levels. Diess, who was VW’s brand chief at the time, became chief executive of Volkswagen Group in April this year. Volkswagen also owns the Scania, Skoda, Audi, Porsche, Bentley, Bugatti, Lamborghini and Ducati brands.
The US Environmental Protection Agency (EPA) had found unusually high pollution levels in VW’s vehicles and was threatening to withhold road certification for new cars until VW explained why pollution levels were too high.
Diess, who had defected from BMW to become head of the VW brand on 1 July 2015, joined the 27 July meeting with Volkswagen’s then Chief Executive Martin Winterkorn to discuss how to convince regulators that VW’s cars could be sold, a VW defence document filed with a court in Braunschweig in February showed.
On Saturday, Volkswagen said both Winterkorn and Diess declined to comment given the ongoing proceedings.
Following this meeting, Winterkorn asked Diess whether BMW too had installed “defeat devices” in its cars, Der Spiegel said.
In the United States, legal engine management software is described as an “auxiliary emissions device” while the term “defeat device” is used to describe only illegal software.
Volkswagen said on Saturday: “The contents of the discussion, where Martin Winterkorn and Herbert Diess were present, cannot be fully reconstructed because the recollections of the people who were present partially deviate.”
Volkswagen further said it was the task of authorities and courts to evaluate the conflicting statements and to assess whether individual witnesses were credible.
