Audi's Former CEO Stadler Charged With Fraud in Volkswagen Diesel Scandal -- Update

(Updates with background, Audi statement)

 
   By Max Bernhard 
 

German prosecutors have filed charges against Rupert Stadler, the former chief executive of premium car maker Audi AG (NSU.XE), in connection with parent Volkswagen AG's (VOW.XE) diesel-emissions scandal.

Mr. Stadler and three unnamed others have been charged with fraud, falsifying certification and illegal advertising, the prosecutors' office in Munich said on Wednesday. The former Audi CEO left the company last year after being detained on suspicion of witness tampering.

Volkswagen, the world's largest car maker by sales, has spent nearly four years trying to put its diesel scandal behind it after admitting in 2015 to having rigged some 11 million vehicles worldwide with software that allowed them to dodge emissions tests. Since then, the company and its subsidiaries have had to pay more than $25 billion in fines and settlement costs.

The legal and financial fallout from the scandal continues to dog the company. Last week, Volkswagen said it took diesel-related charges of about $1 billion in the first half of the year.

Munich prosecutors accuse Mr. Stadler, who was Audi's CEO at the time the scandal erupted, of having been aware of the manipulation since the end of September 2015 at the latest, but of nevertheless allowing the sale of the affected vehicles to continue.

Mr. Stadler has previously denied any knowledge of the manipulation. His lawyers didn't immediately reply to a request for comment.

The charges concern more than 430,000 Audi, Volkswagen and Porsche vehicles, which were mostly sold in the U.S. and European markets, the prosecutors said.

Audi has been inextricably involved in Volkswagen's emissions scandal from the beginning. Mr. Stadler was arrested in connection to the probe in June 2018 and remained in pretrial detention until late October. Volkswagen removed him from his post that month. Around the same time, Audi agreed to pay a fine of 800 million euros ($891 million) for its role in the scandal.

On Wednesday, Audi said it continues to cooperate with authorities to clarify the circumstances leading to the diesel crisis.

"The indictment of individual persons is to be seen separately from the proceedings against AUDI AG, which were concluded in October 2018 with the payment of a fine of EUR800 million," it said.

Last week, in its report for the first six months of the year, Volkswagen said it is still facing lawsuits and criminal investigations in several countries across the globe, including a lawsuit filed by the U.S. Securities and Exchange Commission in March.

Write to Max Bernhard at [e-mail]

(END) Dow Jones Newswires

July 31, 2019 06:23 ET (10:23 GMT)

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