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VW CEO Diess, Chairman Poetsch Settle Market-Manipulation Case

May 19, 2020, 5:49 PM

Volkswagen AG Chief Executive Officer Herbert Diess and Chairman Hans Dieter Poetsch settled a German market-manipulation case that had alleged they informed markets too late about the diesel-emission rigging.

Both men agreed to pay 4.5 million euros ($4.9 million) to end the criminal case in a court in Braunschweig, the supervisory board Tuesday said in a statement. Prosecutors charged the pair alongside former CEO Martin Winterkorn last year alleging they informed the market too late about the U.S. probe into the manipulation of diesel engines.

“The supervisory board welcomes the fact that Mr. Poetsch and Dr. Diess took the opportunity to relieve the pressure on the company in view of its present challenges by consenting to the termination,” the panel said in an e-mailed statement.

The settlement closes a critical chapter in the scandal. Had the case been allowed to go to trial, it would have exposed both men and the company to weeks if not months of court proceedings and the associated media coverage.

The scandal, exposed by U.S. regulators in September 2015, has cost the world’s largest automaker about 30 billion euros so far. Lawsuits from disgruntled investors and consumers are set to drag on for years.

VW’s own lawyers came to the conclusion that both men didn’t commit a crime and also didn’t violate any duties owed to the company, the board said. That’s why VW will indemnify them “with respect to the payment of a fine in the amount of 4.5 million euros each,” according to the statement.

To contact the reporter on this story:
Karin Matussek in Berlin at kmatussek@bloomberg.net

To contact the editors responsible for this story:
Anthony Aarons at aaarons@bloomberg.net

Christopher Elser, Peter Chapman

© 2020 Bloomberg L.P. All rights reserved. Used with permission.

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