German prosecutors have filed aggravated fraud charges against Martin Winterkorn, the former chief executive of Volkswagen, and four other unnamed managers for their involvement in the emissions-cheating scandal.
The charges, filed by the public prosecutor’s office in Braunschweig in a 692-page indictment, are the first criminal charges brought in Germany against any individual in connection with the diesel scandal which came to light in 2015 but which is alleged to have started as far back as 2006.
Former Audi Chief Executive Rupert Stadler was temporarily arrested by Munich prosecutors last year but has not yet been charged.
Prosecutors accuse Winterkorn of aggravated fraud, infringement of competition law, and embezzlement. They say he failed to stop either the installation of defeat devices or the sale of a further 900,000 affected vehicles and that his slow reactions resulted in higher fines for Volkswagen as a consequence.
Prosecutors also argue the former chief executive failed to disclose illegal manipulation of emissions to authorities in Europe and the United States even after he became aware of them. Winterkorn is accused of approving a software update in November 2014, which cost the company €23 million (U.S. $26 million) and was “useless and was intended to further conceal the true reason for the increased pollutant levels in normal vehicle operation,” according to the prosecutor’s statement.
Winterkorn and the four other defendants are accused of ”knowingly and willingly” deceiving Volkswagen customers. Prosecutors want to clawback bonus payments made out to each of them worth between €300,000 (U.S. $339,000) and €11 million (U.S. $12.4 million).
Volkswagen has not released any statement or comment about the charges. The company has previously strenuously denied any involvement of senior figures in the scandal.
Under German law, a judge will now review the charges and then either dismiss them or open a court case. If found guilty, Winterkorn faces a jail term of between six months and 10 years.
The prosecutor’s investigation against a further 36 individuals for their role in the emissions-cheating scandal is ongoing.
Volkswagen was hit with a €1 billion (U.S. $1.1 billion) criminal fine in June last year, making it one of the highest ever punitive payments imposed by German authorities against a company.
Last month, the U.S. Securities and Exchange Commission took Volkswagen and Winterkorn to court, alleging investors had been defrauded. The claims are being contested. The scandal has cost the carmaker about U.S. $30 billion so far in penalties and recalls.