SEC Files Lawsuit Against Volkswagen, Says Company Misled Investors In Emission Scandal

Lawsuit Against VolkswagenUPDATED: 2019/03/15 12:00PM

The United State Securities and Exchange Commission (aka the SEC) is suing Volkswagen and alleging that they defrauded their investors during their diesel emissions scandal. Volkswagen’s former chief executive, Martin Winterkorn, is also named in the lawsuit.

If you’re unfamiliar with the scandal, from April 2014 to May 2015, the German auto company raised more than $13 billion from United States investors as senior executives lied about and even used software to cheat emissions tests. After putting devices on 11 million vehicles, the cars tested as low emission when their actual output was 40 times the United States’ legal limit. The scheme was eventually uncovered by the EPA (Environmental Protection Agency). The complaint alleges that “By concealing the emissions scheme, Volkswagen reaped hundreds of millions of dollars in benefit by issuing the securities at more attractive rates for the company.”

Volkswagen has called these allegations “legally and factually flawed” and says that the SEC is simply “piling on” after the company already admitted guilt and has been paying back billions in settlements and fines.

The SEC is looking to keep Winterkorn from leading a publicly listed company in the United States–he was indicted in federal court for his role in the coverup just last March.

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