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IAV to pay fine for its role in Volkswagen emissions fraud

Christian Fernsby |
IAV was sentenced in federal court in Detroit to pay a $35 million criminal penalty.

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The penalty is the result of the company’s guilty plea for its role in a long-running scheme for Volkswagen AG (VW) to sell approximately 335,000 diesel vehicles in the U.S. by using a defeat device to cheat on U.S. emissions tests mandated by the U.S. Environmental Protection Agency (EPA) and the California Air Resources Board (CARB).

During the sentencing hearing, U.S. District Judge Sean F. Cox of the Eastern District of Michigan accepted the parties’ plea agreement, which includes the appointment of an independent corporate compliance monitor for a period of two years.

Principal Deputy Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Matthew J. Schneider of the Eastern District of Michigan, Deputy Assistant Attorney General Jean E.

Williams of the Justice Department’s Environment and Natural Resources Division, Assistant Administrator Susan Bodine of the EPA’s Office of Enforcement and Compliance Assurance and Special Agent in Charge Timothy R. Slater of the FBI’s Field Office made the announcement.

IAV pleaded guilty in December 2018 to participating in a conspiracy to defraud the United States and VW’s U.S. customers and to violate the Clean Air Act by misleading the EPA and U.S. customers about whether certain VW- and Audi-branded diesel vehicles complied with U.S. emissions standards.

IAV admitted that it and its co-conspirators knew the vehicles did not meet U.S. emissions standards and worked collaboratively to design, test and implement cheating software to cheat the U.S. testing process.

IAV further admitted that it was aware the VW concealed material facts about its cheating from federal and state regulators and U.S. customers.

Pursuant to the U.S. Sentencing Guidelines, IAV’s $35 million fine was set according to the company’s inability to pay a higher fine amount without jeopardizing its continued viability.

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