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VW to pay $86m in penalties to California – Spain charges Volkswagen with fraud over emissions

LOS ANGELES, July 9, (Agencies): Volkswagen AG will pay an additional $86 million in penalties to California over its emissions scandal, on top of a settlement of $14.7 billion the automaker reached with US officials last week, state Attorney General Kamala Harris said in a statement.

The office of Harris, a Democrat, said the $86 million in civil penalties resolved certain claims California officials made against Volkswagen under the state’s unfair competition law as well as under federal law.

“We must conserve and protect our environment for future generations and deliver swift and certain consequences to those who break the law and pollute our air,” said Harris, who is running for a seat in the US Senate.

The scandal has disrupted Volkswagen’s global business and sullied its reputation.

The latest settlement between officials for Volkswagen and California, the nation’s most populous state, provides for $76 million to be paid to Harris’ office to defray costs relating to investigation and litigation of the emissions scandal, according to court documents.

The other $10 million will be dedicated to grants for government agencies and universities, to be used in part to study technology that can help detect so-called “defeat devices,” which on Volkswagen cars produced false results during diesel emissions tests, Harris’ office said.

Admitted

Volkswagen, the world’s second-biggest automaker, has admitted it used sophisticated secret software to cheat exhaust emissions tests, deceiving regulators and customers about pollution from its diesel engines.

Meanwhile, a Spanish judge has charged Volkswagen with fraud and damage to the environment over an emissions-cheating scandal which has plunged the German automaker into crisis, a statement said.

The judge accuses Volkswagen of “suspected participation in fraud, causing damage to a great number of people, of subsidy fraud and of damage to the environment”, according to the charges which were brought on June 30 and published Friday.

The Spanish investigation centres on suspected diesel engine manipulation, made possible by software which detected test conditions and temporarily cut emissions to pass tests on environmental norms, it said.

Among the Volkswagen brands in the spotlight is Spain’s SEAT, taken over by Volkswagen in the 1980s, which runs two factories producing SEAT-branded cars, but also Audis.

Spanish prosecutors asked for permission to open an investigation in October after associations lodged complaints against Volkswagen.

Germany’s parliament was to launch a probe into whether the government colluded in the engine-rigging scandal engulfing auto giant Volkswagen.

German governments have traditionally had very close ties to the automobile industry which is one of the biggest employers in the country and one of its most important export sectors.

Given those links, critics have suggested that the government may have played a part in enabling carmakers to get around pollution regulations and skew the emissions data of their engines.

VW was forced to admit last September that it had installed sophisticated software into 11 million engines with the express purpose of duping emissions tests.

The global scandal triggered by the revelations has come to be known as “Dieselgate”.

Oliver Krischer, deputy faction chief of the environmentalist Green party, accused the government of an “organised failure … making it possible for an entire industry to participate in the trickery and fraud.”

“We want to know why the government looked the other for so long, even though there were lots of indications that cars were exceeding emissions limits on the road.”

The head of the committee is Herbert Behrens, a member of the Left party.

He said he wanted to ascertain whether the industry had aggressively lobbied for legal loopholes.

The committee is scheduled to wrap up its work before next year’s general elections.

But it is only expected to start questioning witnesses and experts in September after the parliamentary summer recess.

“Transport Minister (Alexander) Dobrindt will certainly be called as a witness, as will a lot of others, including several VW management board members,” another committee member Dirk Wiese told the daily Saarbruecker Zeitung in an interview.

Dobrindt has already conducted an investigation into diesel engine emissions, which revealed “irregularities” in 16 different car brands when it was published in April.

But those findings “raise more questions than they answer,” said committee chief Behrens in an an emailed statement.

“The real work to get to the bottom of this begins today,” he said.

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