The United States Securities and Exchange Commission (SEC) alleged Thursday in a court filing that Volkswagen (VW) “perpetrated a massive fraud” and repeatedly lied to U.S. investors in connection with the company’s emissions scandal.
According to the SEC’s complaint, from April 2014 to May 2015, VW issued over $13 billion in bonds and asset-backed securities in the U.S. markets. During that time, the senior executives knew that over 500,000 vehicles in the United States grossly exceeded legal vehicle emissions limits, exposing the company to massive financial and reputational harm.
The complaint alleges that VW made false and misleading statements to investors and underwriters about vehicle quality, environmental compliance, and VW’s financial standing. According to the complaint, by concealing the emissions scheme, VW reaped hundreds of millions of dollars in benefit by issuing the securities at more attractive rates for the company.
The SEC brings this civil enforcement action seeking permanent injunctions, disgorgement with prejudgment interest, and civil penalties against the corporate defendants, as well as permanent injunctions, civil penalties and an officer-and-director bar against Martin Winterkorn, VW’s CEO.