The Man From FCPA might well have expected Volkswagen to have some more good news, as the company continues to distance itself from the emissions-testing scandal. That good news for the company, however, may be yet delayed a bit longer as reports have recently appeared about a new twist on the emissions-testing scandal. This new phase of the scandal may portend longer, deeper, and even more structural issues than have been seen to-date.
In July, the European Union’s antifraud office, OLAF, announced it was recommending criminal charges against at least two company officials over loans the European Investment Bank (EIB) gave to VW to promote its (fraudulent) claims of positive environmental performance around the company’s deiseal auto fleet. The allegations are over some €400 million in loan guarantees. Not surprisingly, when the loans were originally made, there was no information provided to the authorities on the defeat devices or the fraudulent nature of VW’s overall conduct around deiseal engines. Equally unsurprising, it is illegal under German law to make material misrepresentations when seeking funding from government entities.
