VW engineer charged over Dieselgate

Germany lagged behind on discovering the Volkswagen Group’s Dieselgate cheat and now they’re lagging behind on prosecuting criminal behavior from it.

Senior Volkswagen AG engineer James Liang faces five years in jail after pleading guilty in Detroit federal court to conspiring to defraud both Volkswagen customers and the United States regulators.

It is the first criminal charge to be levied against anybody involved in the Volkswagen Group’s Dieselgate emissions cheat, and comes after a yearlong investigation from the US Department of Justice.

The 62-year-old Liang headed up the carmaker’s Diesel Competence division in the US and has agreed to cooperate with US investigators, who are still keen to uncover the details of how Volkswagen fiddled the emissions tests for NOx emissions and who was involved or conspired to bring the cheat to market.

“I know VW did not disclose the defeat device to U.S. regulators in order to sell the cars in the U.S. That’s what makes me guilty,” he told the judge on Friday.

Prosecutors documented a decade-long conspiracy that sprang from the engineers’ inability to make the cars legally compliant with the U.S.’s tough NOx limits. The prosecutors insisted Liang and others increasingly ran the cars “dirty” for increased periods assuming they’d never be caught, then lied to regulators when they were caught.

“Almost from the beginning of VW’s process to design its new ‘clean diesel’ vehicles, Liang and his fellow co-conspirators designed these VW diesel vehicles not to meet U.S. emissions standards, but to cheat the testing process,” the prosecutors stated in their indictment of Liang.

Liang’s lawyer told the court he was “one of many at Volkswagen” involved in the cheat, which involved a car’s software determining whether or not in was being tested in a laboratory and turning off the full emissions-cleaning software if it was on the open road.

Liang and his co-conspirators had code names for the cheating system, calling it either an “acoustic function”, a “cycle-beating function” or an “emissions-tight mode”.

One of his colleagues made the epic mistake of sending Liang an email in 2013 that read “If this goes through without problems, the function is probably truly watertight! ;.)”.

Prosecutors also insisted that Liang’s group updated software in 2014, fraudulently telling customers it was to improve the cars when it was, in reality, solely to run in the dirtier mode longer to reduce Volkswagen’s rising warranty claims on its diesel-cleaning components.

He will be sentenced on January 11 next year (just after the press days of the 2017 Detroit motor show) and besides up to five years in jail, also faces the possibility of a US$250,000 fine.

Volkswagen has already agreed to pay a total of US$16.5 billion in fines, buybacks, recall fixes and environmental rehabilitation over the scandal, which brought down its CEO Martin Winterkorn and lead to 16 other senior managers being suspended.

Liang spent 25 years at Volkswagen’s Wolfsburg headquarters and moved to the US in 2008 – right when the Dieselgate cars were working their way onto the market.