In a shocking case of environmental deceit, IAV GmbH, a German company that engineers and designs automotive systems, has been sentenced to pay a $35 million criminal penalty for its role in a long-running scheme to cheat on U.S. emissions tests.
The penalty was handed down in federal court in Detroit, Michigan, and is the result of IAV GmbH’s guilty plea for its part in Volkswagen AG’s (VW) emissions scandal. The company pleaded guilty in December 2018 to participating in a conspiracy to defraud the United States and VW’s U.S. customers, and to violating the Clean Air Act by misleading the U.S. Environmental Protection Agency (EPA) and U.S. customers about whether certain VW- and Audi-branded diesel vehicles complied with U.S. emissions standards.
IAV GmbH admitted that it and its co-conspirators knew the vehicles did not meet U.S. emissions standards and worked collaboratively to design, test, and implement cheating software to cheat the U.S. testing process. The company also admitted that it was aware that VW concealed material facts about its cheating from federal and state regulators and U.S. customers.
The case was investigated by the FBI and the EPA-Criminal Investigation Division. The prosecution is being handled by Trial Attorneys Philip Trout, Mark Cipolletti, and Gary Winters of the Criminal Division’s Fraud Section; Senior Trial Attorney Jennifer Blackwell of the Environment and Natural Resources Division’s Environmental Crimes Section; and White Collar Crime Unit Chief John K. Neal of the U.S. Attorney’s Office for the Eastern District of Michigan.
The $35 million fine was set according to the company’s inability to pay a higher fine amount without jeopardizing its continued viability. The sentence also includes the appointment of an independent corporate compliance monitor for a period of two years.
The IAV GmbH emissions scandal is a stark reminder of the devastating consequences of corporate greed and environmental deception. As the company pays its $35 million penalty, it is clear that the consequences of cheating on emissions tests will be severe and far-reaching.
Key Facts
- State: California
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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