Volkswagen faces inquiry by EU anti-fraud agency

The EU's anti-fraud agency has launched an investigation into Volkswagen in the latest of a series of inquiries into the emissions scandal at the German carmaker. Olaf, an arm of the European Commission, is looking into whether VW misused loans provided by the European Investment Bank (EIB), according to a source.

VW was plunged into the worst crisis in its history in September when US environmental regulators revealed they had found software-based defeat devices in diesel cars that served to understate emissions of nitrogen-oxides in official tests. Up to 11 million VW vehicles worldwide could be affected.

Inquiries

VW’s actions in the emissions scandal are already being investigated in the US by the Department of Justice and the Environmental Protection Agency. Several regulators in Europe and Asia are also holding inquiries.

The EIB, a non-profit bank owned by EU states and focused on nurturing EU economic growth and jobs, has provided VW with loans of €4.5 billion since 1990, of which €1.9 billion remains outstanding.

Olaf said: “The fact that Olaf is examining the matter does not mean that the persons/entities involved have committed an irregularity/fraud. Olaf fully respects the presumption of innocence and the rights of defence of the persons/entities concerned by an investigation.”

The EIB said a large proportion of the loans provided to VW were aimed at “improving environmental performance”, with some financing research and development into cleaner transport.

The bank is carrying out its own review aimed at ruling out any link between the loans and VW’s cheating in emissions tests.

VW said it was unaware of any inquiry by Olaf, and was “surprised” the agency had gone public “without first informing those involved”.

The company added that VW had fully disclosed to the EIB what the loans it had received were used for.

Meanwhile, prosecutors in Stuttgart said they were investigating employees at Bosch, a privately-owned technology conglomerate, over possible involvement in the VW emissions scandal.

Software

A spokeswoman said prosecutors were looking at whether managers at the company had committed a criminal act in supplying software to VW which may have then been used to cheat in emissions tests. Bosch said it was co-operating with the authorities.

Separately, VW said yesterday it had approval from the German federal motor transport authority for proposed fixes to certain diesel cars affected by the scandal.

The company said the German regulators had approved measures involving software updates for cars with 1.2, 1.6 and 2.0 litre engines that would ensure the vehicles complied with emissions standards. – (Copyright The Financial Times Limited 2015)