VW manager receives 7-year prison term, $400K fine for diesel scandal

Oliver Schmidt

A second former Volkswagen Group employee has received a prison sentence in relation to the automaker’s diesel emissions cheating scandal.

German citizen Oliver Schmidt was sentenced on Wednesday by United States District Court Judge Sean Cox to seven years in prison for his involvement in the scandal. Schmidt was also ordered to pay fines of $400,000.

It follows the sentence of 40 months in prison and $200,000 in fines handed to fellow German citizen James Liang in August. Liang was among the VW engineers that had helped develop the defeat device software designed to hide emissions from regulators.

The harsher sentence for Schmidt, who was the top emissions compliance manager for VW in the U.S., is due to his attempts to hide the scandal from regulators. Prosecutors said Schmidt was a key person in the scandal and had lied about his involvement. The prosecutors also said Schmidt had destroyed a number of important documents and encouraged subordinates to do the same.

In court, Cox said Schmidt had acted in an opportunistic manner, hoping to impress more senior managers and advance his career at VW.

Cox also noted that more senior managers at VW have “not been held accountable” for the scandal. There are six other current and former VW employees that have been charged, though all are in Germany and unlikely to be extradited, except for Zaccheo Giovanni Pamio since he is an Italian citizen. The others, Heinz-Jakob Neusser, Jens Hadler, Richard Dorenkamp, Bernd Gottweis and Jürgen Peter, are all German citizens.

Liang was living in the U.S. at the time of his arrest while Schmidt was on holiday in Florida. Schmidt had pleaded guilty in August to the felony charges of conspiracy and violation of the clean air act. A more serious charge of wire fraud was dismissed as part of his plea.

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VW admitted that it used various software systems to deceive regulators in the U.S. and Europe from 2006 to 2015. In March, the automaker pleaded guilty to three felony charges for which it received multiple fines. The total financial cost to the automaker is set to exceed $20 billion.

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