Oliver Schmidt, a former senior manager at Volkswagen AG [corporate website] was sentenced to 84 months in prison and a $400,000 fine on Wednesday after pleading guilty [agreement, PDF] to one count of conspiracy to defraud the United States and to one count of violating the Clean Air Act.
Issues arose in 2015 when Volkswagen released diesel operated vehicles that did not comply with EPA standards. Schmidt knew of these issues and worked with other employees to not only allow for the violations to continue, but also worked to conceal these issues from the public and the government. Acting U.S. Attorney for the Eastern District of Michigan Daniel Lemisch[official profile] stressed the seriousness of the charges, saying [press release] “This sentence reflects how seriously we take environmental crime… Protecting natural resources is a priority of this office. Corporations, and individuals acting on behalf of corporations, will be brought to justice for harming our environment.”
Court documents indicate that Volkswagen applied for EPA certification of its 2.0 liter diesel engine in 2014, claiming that their designs met U.S. emission standards. After release of these diesel vehicles, studies indicated that there were discrepancies in the amount of nitrogen oxide actually released and the amount recorded during testing. Ultimately, it was determined that Volkswagen had special devices on their diesel vehicles that could detect when they were being tested versus when they were being driven. During testing periods, the vehicles omissions met the standards of the government due to the special devices installed, but would skyrocket during driving periods, almost 30 times higher than the limitations. Schmidt knew of these devices and then worked with other Volkswagen employees to conceal them from the EPA, the Volkswagen AG pleaded guilty to three criminal charges, agreed to pay $2.8 billion in criminal penalties, and then settled in civil court, agreeing to pay $1.5 billion in penalties.