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Volkswagen tops face probe on misleading shareholders

Volkswagen tops face probe on misleading shareholdersThe Volkswagen chief executive and his predecessor are facing an investigation by German authorities into whether they misled investors by not releasing information about the company’s cheating on diesel emissions tests soon enough.

This is reported by The Guardian.

Prosecutors in Stuttgart yesterday formally launched their case against Matthias Müller and his predecessor Martin Winterkorn, who resigned as VW chief executive when the diesel emissions scandal broke in September 2015. The investigation relates to their role as executives in 2015 at Stuttgart-based Porsche Automobil Holding SE, the holding company that controls Volkswagen. Porsche SE chairman Hans Dieter Pötsch is also under investigation.

Prosecutors confirmed media reports that Germany’s federal financial supervisory authority filed a complaint in 2016 asking prosecutors to investigate executives from the holding company. They are accused “of knowingly delaying telling shareholders about the financial consequences for Porsche SE of software manipulation in diesel vehicles by Volkswagen AG”.

Porsche SE said in a statement: “We are convinced that we have duly fulfilled our capital market disclosure requirements.” A Volkswagen spokesman refused to comment on the prosecutors’ statement when contacted by Agence France-Presse.

VW has admitted equipping around 11m cars worldwide with software that sensed when cars were on test stands and turned emission controls up, then turned the controls off during every day driving to improve performance. It has agreed to at least $16bn (£12bn) in civil settlements with environmental authorities and car owners in the US, and to a $4.3bn criminal penalty. Seven VW executives have been criminally charged in the US.

The company also faces investor lawsuits in Germany alleging it did not inform shareholders of the scandal quickly enough. VW says it met its duties. The company apologized for the scandal and says it is changing its culture and practices.
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