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Four former Volkswagen AG managers were convicted by a German court for their roles in the diesel-emission scandal, involving the manipulation of millions of cars and causing $2.4 billion in damages to drivers.
Jens Hadler, who led diesel-engine development from 2007 to 2011, was sentenced to 4 1/2 years in prison over the sale of more than 2 million affected vehicles. Former top engineer Hanno Jelden received 2 years and 7 months for aggravated fraud linked to the sale of nearly 3 million cars.
After a four-year trial, the Braunschweig Regional Court on Monday also handed former executive Heinz-Jakob Neusser a suspended sentence of 1 year and 3 months for his role in the emissions-cheating scheme, which began after it was discovered that vehicles were fitted with software to sidestep pollution rules.
Another lower-ranking manager, who can only be identified as Thorsten D., got a suspended sentence of 1 year and 10 months. All had sought acquittals.
Nearly a decade after the “dieselgate” scandal broke, the verdicts are the tribunal’s first in the criminal probe targeting senior staff at VW’s main brand. The men were charged in 2019 with having vehicles equipped with emission-software manipulation in a case that concerned 9 million cars sold in Europe and the U.S. During the trial, the court narrowed the case to fewer than 4 million vehicles.
The core of the allegations was that cars were equipped with so-called defeat devices leading to two different sets of emissions, depending on whether the vehicles were tested in the lab or used on the streets, Presiding Judge Christian Schütz said when delivering the verdict. On the streets, in a “real drive” scenario, emissions of toxic nitrogen oxides were much higher than during testing, he said.
“The authorities certifying the cars weren’t told that the emissions were much higher in real drive,” Schütz said. “It’s crystal clear that this wasn’t in line with the law.”
Philipp Gehrmann, Jelden’s defense lawyer, said the verdict was incorrect. His client had cooperated and he will appeal, he told reporters after the hearing. Defense lawyers for the other accused left the court without addressing reporters.
The diesel affair sparked global outrage and triggered the departure of VW’s former Chief Executive Officer Martin Winterkorn from the company in September 2015, just days after U.S. authorities disclosed their investigation. Volkswagen itself had settled the criminal probe in 2018 by paying €1 billion to German prosecutors.
Class action
The scandal has so far cost the carmaker more than $37.5 billion, including hefty sanctions that were part of a deal with U.S. authorities. The company is still facing civil litigation in its home country, including a $10.2 billion investor class action.
All men committed aggravated fraud by participating in a group whose aim was to deceive customers, Schütz said. The key decision was taken at a meeting in 2006 when three men, including Jelden, decided to go ahead with the software rigging, he said.
All sentences were reduced due to the long time the prosecution took. Schütz also stressed that they weren’t the only ones responsible for the scam and that many others at VW participated. However, all the accused had leading roles and they committed crimes for many years.
Thorsten D. got the lowest sentence because he cooperated early in the probe and was the first person to admit to U.S. authorities that VW used a defeat device, Schütz said. While Jelden also somewhat cooperated, he was higher ranking and took part in the crucial 2006 meeting that started it all, so he got a higher sanction, the judge added.
Hadler got the longest term because he was leading the diesel-engine development since 2007 and could have easily stopped the scam. His “word had meaning within VW, he was heard by his superiors,” Schütz said. “He had the capacity to stop things.”
Neusser, VW’s former head of engine development, got a suspended term because the trial produced evidence that he only learned about the rigging in 2013 when he was informed about another feature the engineers planned to implement as part of the manipulating software, according to the judge. The damage he caused by not stopping it was still almost $30.7 million, he added.
While the US has quickly charged and convicted several VW managers, Germany has lagged behind. Rupert Stadler, the former chief executive officer of VW’s Audi unit, was sentenced to a suspended term in 2023, but that verdict is still pending on appeal. Ex-VW CEO Herbert Diess and VW chairman Hans Dieter Pötsch settled a market-manipulation probe in 2020, both agreeing to pay $5.1 million.
Ill health
Winterkorn was originally charged alongside the four ex-managers, but his trial was postponed due to health reasons. It started shortly last year, only to be postponed again over a medical condition. Winterkorn has denied any wrongdoing.
The Braunschweig trial started in 2021 after two postponements due to the COVID-19 pandemic. It took 175 hearing days.
Dozens of probes against other employees were dropped, or they were allowed to settle, and some later testified in the trial, stirring criticism from the current defendants, who say they have been singled out and made scapegoats.
“We weren’t part of these decisions and we wouldn’t have agreed to all of them,” Schütz told the accused at Monday’s hearing.
There are still 31 people indicted in Braunschweig who are waiting to be tried over dieselgate. The next case is scheduled to start in November.
Neusser and Hadler are also among executives charged by the U.S. for their involvement in the scandal. Because Germany doesn’t extradite its own citizens to nations outside the EU, they have so far escaped prosecutions in the United States.
Jens Hadler, who led diesel-engine development from 2007 to 2011, was sentenced to 4 1/2 years in prison over the sale of more than 2 million affected vehicles. Former top engineer Hanno Jelden received 2 years and 7 months for aggravated fraud linked to the sale of nearly 3 million cars.
After a four-year trial, the Braunschweig Regional Court on Monday also handed former executive Heinz-Jakob Neusser a suspended sentence of 1 year and 3 months for his role in the emissions-cheating scheme, which began after it was discovered that vehicles were fitted with software to sidestep pollution rules.
Another lower-ranking manager, who can only be identified as Thorsten D., got a suspended sentence of 1 year and 10 months. All had sought acquittals.
Nearly a decade after the “dieselgate” scandal broke, the verdicts are the tribunal’s first in the criminal probe targeting senior staff at VW’s main brand. The men were charged in 2019 with having vehicles equipped with emission-software manipulation in a case that concerned 9 million cars sold in Europe and the U.S. During the trial, the court narrowed the case to fewer than 4 million vehicles.
The core of the allegations was that cars were equipped with so-called defeat devices leading to two different sets of emissions, depending on whether the vehicles were tested in the lab or used on the streets, Presiding Judge Christian Schütz said when delivering the verdict. On the streets, in a “real drive” scenario, emissions of toxic nitrogen oxides were much higher than during testing, he said.
“The authorities certifying the cars weren’t told that the emissions were much higher in real drive,” Schütz said. “It’s crystal clear that this wasn’t in line with the law.”
Philipp Gehrmann, Jelden’s defense lawyer, said the verdict was incorrect. His client had cooperated and he will appeal, he told reporters after the hearing. Defense lawyers for the other accused left the court without addressing reporters.
The diesel affair sparked global outrage and triggered the departure of VW’s former Chief Executive Officer Martin Winterkorn from the company in September 2015, just days after U.S. authorities disclosed their investigation. Volkswagen itself had settled the criminal probe in 2018 by paying €1 billion to German prosecutors.
Class action
The scandal has so far cost the carmaker more than $37.5 billion, including hefty sanctions that were part of a deal with U.S. authorities. The company is still facing civil litigation in its home country, including a $10.2 billion investor class action.
All men committed aggravated fraud by participating in a group whose aim was to deceive customers, Schütz said. The key decision was taken at a meeting in 2006 when three men, including Jelden, decided to go ahead with the software rigging, he said.
All sentences were reduced due to the long time the prosecution took. Schütz also stressed that they weren’t the only ones responsible for the scam and that many others at VW participated. However, all the accused had leading roles and they committed crimes for many years.
Thorsten D. got the lowest sentence because he cooperated early in the probe and was the first person to admit to U.S. authorities that VW used a defeat device, Schütz said. While Jelden also somewhat cooperated, he was higher ranking and took part in the crucial 2006 meeting that started it all, so he got a higher sanction, the judge added.
Hadler got the longest term because he was leading the diesel-engine development since 2007 and could have easily stopped the scam. His “word had meaning within VW, he was heard by his superiors,” Schütz said. “He had the capacity to stop things.”
Neusser, VW’s former head of engine development, got a suspended term because the trial produced evidence that he only learned about the rigging in 2013 when he was informed about another feature the engineers planned to implement as part of the manipulating software, according to the judge. The damage he caused by not stopping it was still almost $30.7 million, he added.
While the US has quickly charged and convicted several VW managers, Germany has lagged behind. Rupert Stadler, the former chief executive officer of VW’s Audi unit, was sentenced to a suspended term in 2023, but that verdict is still pending on appeal. Ex-VW CEO Herbert Diess and VW chairman Hans Dieter Pötsch settled a market-manipulation probe in 2020, both agreeing to pay $5.1 million.
Ill health
Winterkorn was originally charged alongside the four ex-managers, but his trial was postponed due to health reasons. It started shortly last year, only to be postponed again over a medical condition. Winterkorn has denied any wrongdoing.
The Braunschweig trial started in 2021 after two postponements due to the COVID-19 pandemic. It took 175 hearing days.
Dozens of probes against other employees were dropped, or they were allowed to settle, and some later testified in the trial, stirring criticism from the current defendants, who say they have been singled out and made scapegoats.
“We weren’t part of these decisions and we wouldn’t have agreed to all of them,” Schütz told the accused at Monday’s hearing.
There are still 31 people indicted in Braunschweig who are waiting to be tried over dieselgate. The next case is scheduled to start in November.
Neusser and Hadler are also among executives charged by the U.S. for their involvement in the scandal. Because Germany doesn’t extradite its own citizens to nations outside the EU, they have so far escaped prosecutions in the United States.
