U.S. regulators charged Volkswagen and former CEO Martin Winterkorn with defrauding investors during its massive diesel emissions scandal.
The charges from the U.S. Securities and Exchange Commission come two years after the German automaker settled with the U.S. over criminal and civil charges, as the company tries to distance itself from one if its darkest eras.
The SEC said that between April 2014 and May 2015, Volkswagen issued more than $13 billion in bonds and asset-backed securities in U.S. markets when senior executives knew that more than 500,000 vehicles in the country grossly exceeded legal vehicle emissions limits.
Volkswagen made false and misleading statements to investors and underwriters about vehicle quality, environmental compliance, and the company's financial standing, which gave Volkswagen a financial benefit when it issued securities at more attractive rates for the company, according to the SEC.
"Volkswagen hid its decade-long emissions scheme while it was selling billions of dollars of its bonds to investors at inflated prices," said Stephanie Avakian, co-director of the SEC's enforcement division.
In September 2015 Volkswagen installed software on more than 475,000 cars that enabled them to cheat on emissions tests, according to the Environmental Protection Agency. The software reduced nitrogen oxide emissions when the cars were placed on a test machine but allowed higher emissions and improved engine performance during normal driving.
In 2016 the Justice Department sued Volkswagen over the emissions-cheating software and the Federal Trade Commission sued the company, saying it made false claims in commercials promoting its "Clean Diesel" vehicles as environmentally friendly.
Winterkorn resigned saying he took responsibility for the fraud, but insisted he personally did nothing wrong.
The SEC said that he did in the complaint filed Thursday.
Volkswagen did not immediately respond Friday to requests for comment from The Associated Press, but told the German dpa news agency that the SEC is simply repeating unsubstantiated claims against Winterkorn, who was not involved in any sales of bonds.
The company has paid some $20 billion in fines and civil settlements. It has also pleaded guilty to criminal charges in the United States and several managers, including Winterkorn, were charged there.
The surprise charges from the SEC arrive as the German company attempts to distance itself from the scandal. On Tuesday the automaker said that it planned to ramp up production of electric vehicles over the next ten years, to 22 million, and reduce its carbon footprint over vehicle life cycles by 30 percent.
Volkswagen's pivot to electric vehicles comes as it seeks to comply with new limits on carbon dioxide emissions in Europe, and a push by China for more low-emission vehicles.
The SEC's complaint, filed in the U.S. District Court for the Northern District of California, charges Volkswagen AG, its subsidiaries Volkswagen Group of America Finance, LLC and VW Credit, Inc., and Winterkorn with violating the antifraud provisions of the federal securities laws.
The SEC seeks permanent injunctions, disgorgement of ill-gotten gains with prejudgment interest and civil penalties. It also wants to bar Winterkorn from holding any corporate officer or director positions.
LAS VEGAS (AP) — A $12 billion passenger bullet train linking Las Vegas and the Los Angeles area was dubbed the first true high-speed rail line in the nation on Monday, with the private company building it predicting millions of ticket-buyers will be boarding trains by 2028.
“People have been dreaming of high-speed rail in America for decades,” said U.S. Transportation Secretary Pete Buttigieg before taking a stage with union representatives and company officials at the future site of a terminal to be built just south of the Las Vegas Strip. “It’s really happening this time."
Buttigieg cited Biden administration support for the project that he said will bring thousands of union jobs, boost local economies and cut traffic and air pollution.
Brightline West, whose sister company already operates a fast train between Miami and Orlando in Florida, aims to lay 218 miles (351 kilometers) of new track almost all in the median of Interstate 15 between Las Vegas and Rancho Cucamonga, California. It would link there with a commuter rail connection to downtown Los Angeles. A station also is planned in San Bernardino County’s Victorville area.
Company officials say the goal is to have trains exceeding speeds of 186 mph (300 kph) — comparable to Japan’s Shinkansen bullet trains — operating in time for the Summer Olympics in Los Angeles in 2028.
“I believe we’ll look back at today and say, ’This was the birth of an industry of high-speed rail,'” Brightline Holdings founder Wes Edens said Monday.
The company aims to link U.S. cities that are too near each other for air travel to make sense and too far for people to drive.
Las Vegas has no Amtrak service. The idea of a bullet train to Los Angeles dates back decades under various names including DesertXpress. Brightline West acquired the project in 2019, and company and public officials say it has all required right-of-way and environmental approvals, along with labor agreements.
Brightline received Biden administration backing including a $3 billion grant from federal infrastructure funds and recent approval to sell another $2.5 billion in tax-exempt bonds. The company won federal authorization in 2020 to sell $1 billion in similar bonds.
Brightline West says electric-powered trains will cut the four-hour trip across the Mojave Desert to a little more than two hours. It projects 11 million one-way passengers per year, with fares that Edens said will be comparable to airline ticket costs. The trains will offer rest rooms, Wi-Fi, food and beverage sales and the option to check luggage.
Officials hope the train line will relieve congestion on I-15, where drivers often sit in miles of crawling traffic while returning home to Southern California from a Las Vegas weekend. An average of more than 44,000 automobiles per day crossed the California-Nevada state line on I-15 in 2023, according to Las Vegas Convention and Visitors Authority data.
Florida-based Brightline Holdings' Miami-line debuted in 2018 and expanded service to Orlando International Airport last September with trains reaching speeds up to 125 mph (200 kph). It offers 16 round-trips per day with one-way tickets for the 235-mile (378-kilometer) distance costing about $80.
Other fast trains in the U.S. include Amtrak’s Acela, which can top 150 mph (241 kph) between Boston and Washington, D.C. But fast train connections for other U.S. cities have been floated, including Dallas to Houston; Atlanta to Charlotte, North Carolina; Chicago to St. Louis; and Seattle to Portland, Oregon. Most have faced delays.
In California, a proposed 500-mile (805-kilometer) rail line linking Los Angeles and San Francisco was approved by voters in 2008, but has been beset by rising costs and routing disputes. A 2022 business plan by the California High-Speed Rail Authority projected the cost had more than tripled to $105 billion.
The Las Vegas strip is shown behind the groundbreaking sight of a high-speed passenger rail line between Las Vegas and the Los Angeles on Monday, April 22, 2024, in Las Vegas. A $12 billion high-speed passenger rail line between Las Vegas and the Los Angeles area has started construction. (AP Photo/Ty ONeil)
CORRECTS TO SEN. CATHERINE CORTEZ MASTO Sen. Catherine Cortez Masto, D-Nev., speaks at the groundbreaking for a high-speed passenger rail on Monday, April 22, 2024, in Las Vegas. A $12 billion high-speed passenger rail line between Las Vegas and the Los Angeles area has started construction. (AP Photo/Ty ONeil)
Kids play in confetti at the groundbreaking ceremony for a high-speed railway on Monday, April 22, 2024, in Las Vegas. A $12 billion high-speed passenger rail line between Las Vegas and the Los Angeles area has started construction. (AP Photo/Ty ONeil) (AP Photo/Ty ONeil)
U.S. Secretary of Transportation Pete Buttigieg speaks at the groundbreaking for a high-speed passenger rail on Monday, April 22, 2024, in Las Vegas. A $12 billion high-speed passenger rail line between Las Vegas and the Los Angeles area has started construction. (AP Photo/Ty ONeil)
A plane takes off behind a groundbreaking for a high-speed passenger rail on Monday, April 22, 2024, in Las Vegas. A $12 billion high-speed passenger rail line between Las Vegas and the Los Angeles area has started construction. (AP Photo/Ty ONeil)
Sen. Jacky Rosen, D-Nev., speaks at the groundbreaking for a high-speed passenger rail on Monday, April 22, 2024, in Las Vegas. A $12 billion high-speed passenger rail line between Las Vegas and the Los Angeles area has started construction. (AP Photo/Ty ONeil)
Sen. Catherine Cortez Masto, D-Nev., left, and Sen. Jacky Rosend, D-Nev., right, speak at the groundbreaking for a high-speed passenger rail on Monday, April 22, 2024, in Las Vegas. A $12 billion high-speed passenger rail line between Las Vegas and the Los Angeles area has started construction. (AP Photo/Ty ONeil)
Nevada Governor Joe Lombardo leaves the stage at a groundbreaking for a high-speed passenger rail on Monday, April 22, 2024, in Las Vegas. A $12 billion high-speed passenger rail line between Las Vegas and the Los Angeles area has started construction. (AP Photo/Ty ONeil)
U.S. Secretary of Transportation Pete Buttigieg, center, Sen. Catherine Cortez Masto, right, drive rail spikes into a symbolic rail, on Monday, April 22, 2024, in Las Vegas. A $12 billion high-speed passenger rail line between Las Vegas and the Los Angeles area has started construction. (AP Photo/Ty ONeil)
FILE - This photo taken Wednesday, Jan. 25, 2012, shows the site of a proposed station for a high-speed rail line to Las Vegas, background, at the end of the Dale Evans Parkway exit from Interstate 15, on the far outskirts of the Mojave Desert city of Victorville, Calif. Brightline West and U.S. transportation secretary and other officials projecting that millions of ticket-buyers will be boarding trains by 2028. (AP Photo/Reed Saxon)
FILE - This photo Jan. 25, 2012, photo shows the site of a proposed station for a high-speed rail line to Las Vegas, foreground, with Interstate 15 in the background, on the far outskirts of Victorville, Calif., the Mojave Desert city on the route from Los Angeles to Las Vegas. Brightline West and U.S. transportation secretary and other officials projecting that millions of ticket-buyers will be boarding trains by 2028. (AP Photo/Reed Saxon)
This Jan. 25, 2012, photo shows the site of a proposed station for the high-speed rail line to Las Vegas at the end of the Dale Evans Parkway exit from Interstate 15, on the far outskirts of the Mojave Desert city of Victorville, Calif. Brightline West and U.S. transportation secretary and other officials projecting that millions of ticket-buyers will be boarding trains by 2028. (AP Photo/Reed Saxon)
FILE - A Brightline train is shown at a station in Fort Lauderdale, Fla., on Jan. 11, 2018. A fast-tracked plan to build a high-speed passenger rail line between Las Vegas and the Los Angeles area is set to mark the start of construction. Brightline West and U.S. transportation secretary and other officials projecting that millions of ticket-buyers will be boarding trains by 2028. (AP Photo/Wilfredo Lee, File)
