Published: Wed, September 14, 2016
Economy | By Melissa Porter

VW engineer pleads guilty in emissions case, will cooperate

A Volkswagen (VW) engineer has pleaded guilty for his role in implementing software created to defraud USA regulators and customers beginning in 2006. He and other VW employees developed a complex software system to keep emissions low when a auto was undergoing testing to demonstrate environmental compliance, but to allow them to spew higher emissions on the road while boosting fuel efficiency, the indictment said.

As described in a 25-page indictment unsealed Friday along with the plea deal, Mr. Liang and his co-conspirators at Volkswagen knew "from nearly the beginning of VW's process to design its new "clean diesel" vehicles" that the cars "would not meet US emissions standards".

Volkswagen said in a statement that it is "continuing to cooperate with the U.S. Department of Justice", but couldn't comment on the indictment. He and the co-conspirators also knew that the company's "clean diesel" promotional claims were false, the Justice Department said.

The indictment says that the veteran engineer conspired with current and former workers of the German auto firm to mislead the United States government about a defeat device that let the company sell its diesel cars with emissions level higher than the country's emissions limit allow.

"Mr. Liang certainly knew enough that the US government has embraced him as its first and certainly a prominent cooperator", said Frenkel, who added the Liang likely will get little or no prison time due to his cooperation. He faces a maximum penalty of five years in prison and a fine up of to $250,000. Volkswagen settled civil cases in June over cheat devices on 2-liter engine diesel cars sold in the an agreement valued at $14.7 billion that requires it to buy back or fix vehicles, and pay each owner up to $10,000.

According to the plea agreement, from 1983 until May 2008, Liang was an employee of Volkswagen AG (VW), working in its diesel development department in Wolfsburg, Germany.

Liang, according to the plea, used the cheat software on the 2.0-liter TDI engine and helped make the software work, which the "co-conspirators needed" to win EPA approvals.

The Department of Justice (DOJ) [official website] stated that Liang and other employees designed [press release] the engine in 2006 after they were unable to design an engine that met U.S. emissions standards. The software then calibrated the engine to run cleaner than it would in real world driving, according to the indictment.

Even after VW deployed the "defeat device" without attracting attention from regulators, engineers faced another issue in keeping the illegal software a secret.

As a first step, VW offered a new "optimized" software update that was supposed to address the high emissions.

"We must be sure to prevent the authority from testing the Gen 1!" a VW employee emailed in June 2015, referring to the first generation of VW models using the "clean diesel" engines.

The indictment describes meetings dating to 2006 between Mr. Liang, other unidentified Volkswagen employees and regulators, during which the auto maker presented the new diesel engine without mentioning it didn't meet emissions standards. The emails said that if Gen 1 is tested by the California Air Resources Board "then we'll have nothing more to laugh about!"

This story has been corrected to show that James Laing lives in Newbury Park, California, not Newberry Park.

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