Volkswagen is paying over $4 billion in fines to US regulators
January 11, 2017 – Volkswagen spokesperson has confirmed that they have [nearly] finalized a deal with US regulators to settle the [misleading/misconducting] diesel emission case. Volkswagen is paying more than $4 billion dollars plus they will plead guilty to criminal misconduct. Details of this deal are not yet made public, but an inside source told the media that Volkswagen will assist investigators in their investigation into some of Volkswagen’s employees [most of whom are no longer part of the company.] Usually, big firms settle cases by giving away millions or billions of dollars, but it is the first time I am hearing about a company pleading guilty to criminal misconduct charges. You don’t see that happen often! Volkswagen is paying around $4.3 billion in fines to US regulators.
This is another bad news for shareholders of Volkswagen, a German automaker. It is one of the biggest automakers in the world; it produced more than 10 million vehicles in 2015! But they came under scrutiny after the revelation that some Volkswagen diesel cars/models have a software installed in them that pretends to emit mush less pollution when the vehicle is under testing environment. This hack allowed these vehicles to easily pass pollution tests by US regulators; in fact, they were able to get good ratings. However, on the road, these same vehicles were spreading high levels of pollution. The hack is designed to consume more fuel and emit less toxic gases; this off course reduces the mileage. In addition to consuming more fuel, the vehicle power is also reduced when this hack is activated. This is sad, really… Seeing big companies doing fraud like this. They are fooling customers and governments, and are contributing to pollution worldwide just to make more money. Shame on you, Volkswagen. I hope authorities will punish the people, employees, who are behind this awful scheme.
In 2016, Volkswagen agreed to pay over $15 billion to settle claims by shareholders and some government cases. The deal also included paying money to consumers to settle their lawsuits. According to that deal, Volkswagen agreed to spend over $10 billion to buy back or repair the diesel vehicles that have their cheating hack [software] installed in them. Now, with this recent deal, Volkswagen [in total so far] is about $20 billion out-of-pocket. Their share price has dropped significantly since this scandal came to surface. I wonder how many other vehicles have this hack in them…
Note that the recent $4.3 deal is not yet finalized. A judge needs to ok it, but before that, Volkswagen’s management has to formally approve it.