Volkswagen Fined One Billion Euros By German Prosecutors Over Emissions Cheating (reuters.com) 116
Volkswagen was fined one billion euros ($1.18 billion) over diesel emissions cheating in what amounts to one of the highest ever fines imposed by German authorities against a company, public prosecutors said on Wednesday. From a report: The German fine follows a U.S. plea agreement from January 2017 when VW agreed to pay $4.3 billion to resolve criminal and civil penalties for installing illegal software in diesel engines to cheat strict U.S. anti-pollution tests. "Following thorough examination, Volkswagen AG accepted the fine and it will not lodge an appeal against it. Volkswagen AG, by doing so, admits its responsibility for the diesel crisis and considers this as a further major step toward the latter being overcome," it said in a statement. The fine is the latest blow to Germany's auto industry which cannot seem to catch a break from the diesel emissions crisis. Germany's government on Monday ordered Daimler to recall nearly 240,000 cars fitted with illicit emissions-control devices, part of a total of 774,000 models affected in Europe as a whole.
Wrong link (Score:2)
Proper link (Score:5, Informative)
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Yes.... because consumers have no other place to buy cars. Oh wait.
Maybe cars are a competitive market and VW will not be able to pass this straight to their customers.
I take you are American, and as such not really familiar with competitive markets.
Probably not enough (Score:2)
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I don't think this'll cover damages to folks health did to dirty air let alone be more than the profit they made cheating. Until we find them more than the money they made they're gonna keep doing this crap.
I find it curious that when individual people do bad things, we tend to go to jail, at least fairly often, but when a company does bad things, seldom anyone goes to jail. There needs to be a point where crimes that hurt a lot of people that are caused by deliberate actions result in the people ultimately in charge going to jail.
Re:Probably not enough (Score:5, Insightful)
Should you automatically put the CEO in jail if they weren't responsible and had no part in the wrong doing? What if they were the person who noticed something was wrong and blew the whistle on the wrong doing?
What about the more morally gray cases where the upper management is pushing hard for results and some of the underlings interpret these directives is creative, yet illegal or unethical ways? We can establish that the CEO might have ultimately caused the behavior, but they never asked for something illegal.
We could further descend the ladder until we get the bottom rung where the CEO has a signed letter in blood telling everyone to kill and rape babies to increase profits where it's pretty clear that they need to go away for a long while. However, the point is that where in there is the line where you know exactly which people need to go to jail and which people don't?
With an individual crime it's a lot easier for a jury to wrap their head around what happened and there are far fewer conflicting versions of events. Try to put a group on trial, and no one really knows who to trust when all of the fingers start getting pointed and there's always enough plausible deniability or presumption of innocence that it's a lot harder to get a jury to convict. Also, a large organization is going to have a lot of money to spend on lawyers. Much like a celebrity, they can afford the best legal talent so you're more likely to get away with murder, figuratively and likely literally as well.
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Instead of putting someone in the company in jail you could ban the company from selling anything for 10 years or something like that. Punish what company wants which is money. Companies will think twice before doing something like that. If the company will go bankrupt due to the ban then so be it, they have themselves to blame.
Jail is a harsh sentence for a person. People can die of old age in jail, they did it to themselves.
Not being able to earn money is a harsh sentence for a company. Companies can go b
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Right, people will lose their job. The company could be forced to pay just as normal until they cant any more during the ban.
That is just how it is. No one said the world was not harsh.
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The law is the law, they would be punished the same way. Just like murderers be punished the same way.
How are you not following the logic? If you have trouble understanding do not hesitate to ask questions. I do not bite (unless you want me too).
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....we'll find a situation where the board of directors are paid scapegoats whilst the real board hides from view.
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Re:Probably not enough (Score:4, Interesting)
With that said, a stiff fine is in order. But not like this. €1B to Germany, $4.3B to the US, then maybe another $1B by the state of California, $500M to the city of New York, €1.5B to France, €2B to Mexico, well, you get the picture. It's not in anyone's interest to cripple this company, and I would much rather have seen smaller fines plus some jail time for those responsible.
Re:Probably not enough (Score:4, Insightful)
You can't just claim damages due to "dirty air"
Of course you can. The air would have been much less polluted if Volkswagen and the others hadn't cheated.
at most you could claim damages for much dirtier the air has gotten due to Volkswagen not quite meeting the Euro-6 norm or whatever it is.
There is no "not quite" about it when we are talking about more than an order or magnitude. This is not astronomy.
It's not in anyone's interest to cripple this company
It is absolutely in my interest to cripple them. I have zero faith that they will not do the exact same thing the next time they think they can get away with it.
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The car industry is extremely competitive. The factories would not stay closed for long, competitors would take over.
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Depends on what you think the obvious issues are. To me, the obvious issues are that this company behaved in an exceptionally unethical manner, and both it and other companies in the same industry need a strong disincentive, or they will do the same again.
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Why not? Bankrupt the company. (Or don't if you think the crime wasn't extreme enough. But I have no problems with fines completely wiping a company out.)
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Fining them won't be enough. In most cases the managers responsible will have moved on to other jobs and cashed their bonuses before the faeces gets ventilated.
The US has it right in this case. Criminal charges against the people responsible.
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That is exactly what Germany is doing. However, unlike they US, they have an actual criminal investigation and fair trials, so it takes a bit longer.
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That is exactly what Germany is doing.
I would be very interested in a citation for that. A quick Googling didn't turn up anything except US efforts.
Re: Probably not enough (Score:1)
Then you must be exceptionally bad at using Google. The domestic criminal investigations against dozens of current and former VW employees has been all over the newspapers for the past two years.
Re:Probably not enough (Score:5, Informative)
Source: https://www.reuters.com/articl... [reuters.com]
Then we have one of the major German newspapers noting that Winterkorn stands to lose his entire financial existence.
Source: http://www.faz.net/aktuell/wir... [faz.net] (you may need a translator)
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How much did the average person's probability of having health problems increase due to VW's emissions being higher then advertised?
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cannot seem to catch a break (Score:4, Insightful)
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That would be perfect in the perfect world, but the regulations are not linear or even close to being uniform. The regulations do not care about the miles per gallon, they only go by how much emissions come out of burning a regulated amount of fuel. This process harms small cars compared to large diesel trucks, because it assumes both vehicles would get the same mileage.
A v8 turbodiesel dually gets 12mpg and puts out 250 grams of pollution per liter of fuel burned. A 4 cylinder putting out 251 grams per liter while getting 4 times the mpg (48mpg vs 12) is "cheating".
If we figure the pollution if both vehicles drove 48 miles....
Truck: (48 / 12) * 250 = 1000 grams of pollution.
4 cylinder vw: (48 / 48) * 251 = 251 grams of pollution...
So essentially the regulations don't care that the V8 turbo diesel trucks pollute 1,000 grams on the same drive that the VW would pollute 251 grams. I. E. The truck gets a free pass to pollute 4 times as much while calling rhe VW a "cheater".
Suuuuuurrreee. But really, fix the regulations.
You forgot to factor in the amount of mass moved in that distance. What if that V8 turbo diesel is in a bus that is carrying 100 passengers? Or a truck that is hauling 50 tons of some product? How many more trips will that 4 cylinder VW need to make to do the same? Basically it can carry 4 people plus a driver. So it would need to make 25 trips to move the same number of people as the bus. I'll be generous and say you can haul half a ton in the VW. That's 100 trips to haul what the truck did. In either cas
Hate train aside... (Score:5, Funny)
now is the time to pick up a volkswagon for cheap...
Re: Crush VW (Score:2)
Fine the bosses and the shareholders... (Score:2)
Re:Fine the bosses and the shareholders... (Score:5, Insightful)
That is actually an excellent point!
A suitable punishment would be to take away all government-granted monopolies, since they do not play by the rules of the government. Goodbye Volkswagen patents!
That would benefit the owners of Volkswagen vehicles, who were defrauded and who have so far not had a penny in compensation (at least in Europe).
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The VW owners now have cars with less performance and worse fuel economy than they had when bought. The competitors cheated too, and obviously they should be punished as well, but VW is by far the worst offender according to what has been revealed so far.
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How does "Volkswagon's profits are being taken away via fines" correspond to "the prices of my spare parts are going up"? I'm going to need some explaination
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Executive 1: Damn, we're a billion euros in the hole. There goes my profit sharing.
Executive 2: Yeah. We'll have to make that billion up somewhere.
Executive 1: Not to mention the money we're going to lose refitting stock, increased governmental scrutiny, blah blah blah.
Executive 2: Guess we'll need to bump up prices on everything.
Executive 1: Yup.
Re:Fine the bosses and the shareholders... (Score:4, Interesting)
You can't fine a company. You can only fine its customers or low level employees using existing corporate laws which protect the share holders.
The correct thing to do is force the company it issue a billion dollars in new stock and give it to the government. That is the only way to fine the share holders who have a responsibility to ensure the board is above board.
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So if a billion dollars shows up on the liabilities side of the balance sheet of a company that won't affect the share price? How exactly are the share holders more culpable than the low level employees or even customers? There is actually a formula for calculating what percentage a of a tax is payed by a company versus it's customers. (For our purposes a fine is equivalent to a tax.) That is, what percentage comes out of profits versus being passed on to customers as higher prices. It depends upon the
Shareholders fined. (Score:4, Insightful)
The perps are in their mansions, not in jail.
The perps are not going to pay the fine. There is no clawback provision to get back the bonuses and salaries and incentives they got for achieving the goals by cheating.
The shareholders should sue the board and ask them to pay the fine without using company funds.
Board might sue the old office holders and get the money from them.
But none of that will happen. So next scandal will happen. There is no effective way to punish the Criminal Executive Officers.
Re:Shareholders fined. (Score:4, Informative)
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Or back in reality, company fined, shareholders hold executives who are left accountable, executives who over saw the scandal are at very real risk of losing it all given the proceedings under way, and the company has been majorly forced to day track a migration away from diesel which has seen its group release several EVs and work on several more... Unlike US companies.
Expect it to be returned. (Score:3)
The government can return the money as tax deductions next year, or the next one, if need be. What should be done, and curiously enough isn't, is to apply the law and forbid the sales of non emission-compliant cars. Most models sold even today are still non compliant, and sold without anybody saying anything. That makes a fool of the law, and of the consumers.
Instead they give a fine. Great. If anybody, the regulators should be fined. They simply "trusted" the manufacturers, instead of doing a proper independent road test of the new models. It's obvious that everybody was in the deception, and worse still, they still are.
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All that matters is that fines can be issued to benefit those running the 'broken rules -> fines' system.
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What should be done, and curiously enough isn't, is to apply the law and forbid the sales of non emission-compliant cars.
Err did you miss the bit about how the VWs sold now had significantly down rated specs than the same model sold only a few years earlier?
Instead they give a fine. Great.
Yeah that's all they did. All of it. Nothing else what so ever. /sarcasm /sarcasm ... one more for good measure: Certainly ther
Certainly the Germans aren't currently prosecuting several of the managers at the time.
Oh no wait, I have more sarcasm: Certainly they didn't force the company to spend $2bn on electric car R&D the results of which have already born some fruit.
This is weird (Score:2)
Re: This is weird (Score:1)
You are forgetting a dozen or so others...
\o/ (Score:1)
Gotta love environmental regulations which serve to enable largish fines like this* but.... how does this help the citizens, whose health is nominally protected by this legislation?
(*) equivalent to the penalty for downloading close to a hundred mp3s!!, but I digress...---^
Doesn't seem like enough (Score:1)
They should be forced to essentially 'buy' back ALL of the effected cars.
Not at current value, but at the original value of the vehicle at the day of sale.
Maybe a heavy loss of having to buy back all of those vehicles, and and then not being able to sell them ever, would be enough of a punishment.
End days for diesel (Score:2)