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Volkswagen accused of emissions-related investor fraud

Martin Winterkorn, former CEO Volkswagen

Volkswagen and its former chief executive Martin Winterkorn are being sued by the US Securities and Exchange Commission (SEC) over the alleged defrauding of investors through the dieselgate emissions scandal.

The SEC filed its complaint in the District Court for the Northern District of California on Thursday, claiming that VW issued more than $13bn (£9.8bn) in bonds and asset-backed securities between April 2014 and May 2015 – a time when, it alleges, the carmaker’s senior executives were aware that 500,000 vehicles in the country exceeded legal emissions limits.

Quoted in the Financial Times today, a Volkswagen Group spokesman described the case against it as “unprecedented” and “legally and factually flawed”, adding that no one involved in the issuance of payments on the bonds at issue knew of the emissions issue.

“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, according to the complaint,” the SEC said.

The SEC’s suit against VW also seeks to bar Winterkorn, who resigned when the scandal became public, from serving as an officer or director of a public US company.

He has been charged in the US with conspiring to cover up the emissions cheating scandal.

Germany does not extradite its own citizens, however.

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