While Volkswagen appears to be finalizing a settlement with regulators and most of its American customers affected by its diesel emissions cheating scandal, there’s still the matter of criminal probe by the Justice Department.
Citing people familiar with the matter, The Wall Street Journal (subscription required) on Monday reported that federal investigators have found evidence of criminal wrongdoing at VW in relation to the scandal.
The newspaper reported that the Justice Department was currently in talks with VW to reach a settlement before the end of the year and that no actual charge had been made yet. Examples of previous charges made against automakers by the department include things like wire fraud and concealing information from officials.
It’s possible the Justice Department will seek a guilty plea from VW, though the more likely option will be a deferred prosecution agreement, whereby the charges would eventually be dropped as long as VW adheres to an agreed upon settlement. The latter option was dealt in 2015 to General Motors Company [NYSE:GM] over the automaker’s defective ignition switches linked to 124 deaths, as well as in 2014 to Toyota which had concealed information about sudden acceleration cases. GM ended up paying $ 900 million while Toyota paid $ 1.2 billion.
It’s unclear if any individuals working at VW will also be charged.
Note, VW is yet to announce a settlement for 85,000 cars sold with larger 3.0-liter V-6 diesel engines that also cheated on emissions (the previous $ 15 billion settlement linked above is only for 2.0-liter diesel engines). So far the company has set aside $ 21 billion to deal with the fallout its emissions cheating scandal.