Volkswagen Engineer Pleads Guilty in Emissions-Cheating Scandal

WASHINGTON, DC — Volkswagen engineer James Robert Liang pleaded guilty to criminal charges Friday for his role in the nearly 10-year diesel-emissions cheating fiasco and will cooperate with the government in its ongoing investigation of the automaker’s alleged conspiracy to defraud U.S. regulators and U.S. customers, the Justice Department said.

Liang, 62, of Newbury Park, California, pleaded guilty to one count of conspiracy to defraud the United States, to commit wire fraud and to violate the Clean Air Act. He was indicted under seal on June 1 by a federal grand jury, and the indictment was unsealed Friday. The case has been assigned to U.S. District Judge Sean F. Cox of the Eastern District of Michigan.

Liang, who worked with Volkswagen’s diesel development in Wolfsburg, Germany, admitted that beginning in about 2006, he and his co-conspirators started to design a new diesel engine for sale in the United States but realized it wouldn’t meet stricter U.S. emissions standards.

To compensate, Liang admitted they rigged software to manipulate the results of emissions testing in 475,000 cars with 2-liter diesel engines in the United States with “defeat devices.” The device was designed to detect when the car was undergoing official emissions testing and turn on full emissions controls only during the tests.

Liang moved to the United States in May 2008 to assist in the launch of VW’s new “clean diesel” vehicles in the U.S. market, according to the plea agreement. While working at VW’s testing facility in Oxnard, California, he has held the title of leader of diesel competence.

According to the plea agreement, employees of VW and its U.S. subsidiary met with the Environmental Protection Agency and the California Air Resources Board to seek the certifications required to sell each model year of its vehicles to U.S. customers. Liang admitted that during some of these meetings, which he personally attended, his co-conspirators misrepresented that VW diesel vehicles complied with U.S. emissions standards and hid the existence of the defeat device from U.S. regulators.

As part of the certification process for each new model year, including model years 2009 through 2016, Liang and co-conspirators continued to falsely and fraudulently certify to EPA and CARB that VW diesel vehicles met U.S. emissions standards and complied with the Clean Air Act, according to the plea agreement.

Liang admitted that during that time, he and his co-conspirators knew that VW marketed its diesel vehicles to the U.S. public as “clean diesel” and environmentally friendly, and promoted the increased fuel economy. Liang and his co-conspirators knew that these representations were false and that VW’s diesel vehicles were not “clean,” he admitted.

In his guilty plea, Liang admitted that he helped his co-conspirators continue to lie to the EPA, CARB and VW customers even after the regulatory agencies started raising questions about the vehicles’ on-road performance following an independent study commissioned by the International Council on Clean Transportation. The study showed that the diesel vehicles’ emissions on the road were up to 40 times higher than shown on the dynamometer.

In June, the automaker agreed to pay a $15 billion settlement to regulators and consumers. Under the settlement, which covers about 500,000 Volkswagen TDI diesel models of Jettas, Passats, Golfs and Beetles as well as the TDI Audi A3 for model years 2009 through 2015, consumers are eligible for about $10.03 billion.

Here is the indictment unsealed Friday.

Here is James Robert Liang's plea agreement

Liang Rule 11 Agreement

Photo by Gábor Kovács via Flickr Commons