Volkswagen has agreed to pay a total of $4.3 billion in criminal and civil penalties stemming from the German automaker’s efforts to cheat on federal and state emissions tests, the U.S. Department of Justice announced Wednesday.
That number includes $2.8 billion in criminal penalties as well as $1.5 billion to resolve environmental, customs and financial claims, the agency said. Volkswagen will also plead guilty to three felony counts, will be on probation for three years and will be overseen by a corporate compliance monitor for that time, DOJ said.
About 590,000 diesel vehicles in the U.S. were sold that included a so-called defeat device to make their emissions seem lower than they were on tests mandated by the Environmental Protection Agency and the California Air Resources Board.
Six German executives and employees of Volkswagen have also been indicted and charged with one count of conspiracy to defraud the United States: Heinz-Jakob Neusser, 56; Jens Hadler, 50; Richard Dorenkamp, 68; Bernd Gottweis, 69; Oliver Schmidt, 48; and Jürgen Peter, 59.
All are believed to be in Germany except for Schmidt, who was arrested in Miami on Friday and appeared in federal court there on Monday. The U.S. and Germany do not have an extradition agreement.
Schmidt worked as the general manager in charge of VW’s environment and engineering Office, in Auburn Hills, Michigan, from 2012 until February 2015. After that time and through September 2015, he worked directly for Heinz-Jakob Neusser, who was the head of development for the VW brand from July 2013 until September 2015.
Jens Hadler was head of engine development from May 2007 until March 2011. Bernd Gottweis was a supervisor responsible for quality management and product safety from 2003 until December 2014. Jürgen Peter has worked in the quality management and product safety group since 1990. From March 2015 until July 2015, he was one of the liaisons between the regulatory agencies and VW.
Richard Dorenkamp was the head of VW’s engine development after-treatment department from 2003 until December 2013. From 2006 to 2013, Dorenkamp led a team of engineers that developed the first diesel engine intended to meet the new, tougher emissions standards in the United States.
The indictment also charges Dorenkamp, Neusser, Schmidt and Peter with Clean Air Act violations. Neusser, Gottweis, Schmidt and Peter also face wire fraud charges.
It is extremely rare for corporate executives to receive criminal charges, even when their company is found to have behaved criminally. White-collar prosecutions in the U.S. have dropped by about a fifth over the past decade.
“When Volkswagen broke the law, EPA stepped in to hold them accountable and address the pollution they caused,” said EPA Administrator Gina McCarthy in a statement. “EPA’s fundamental and indispensable role becomes all too clear when companies evade laws that protect our health. The American public depends on a strong and active EPA to deliver clean air protections, and that is exactly what we have done.”