TORONTO – The U.S. Justice Department has opened a criminal probe after Volkswagen made the stunning admission that it rigged vehicles to deceive emissions tests for diesel-powered vehicles sold in the U.S., according to multiple media reports.
And a Canadian law firm says it’s filing a class action on behalf of VW owners.
Citing to two U.S. officials familiar with the case, Bloomberg reported Monday that investigators will look at whether there was any criminal wrongdoing after the U.S. Environmental Protection Agency (EPA) revealed last week Volkswagen AG used software allowing its diesel cars to release fewer smog-causing pollutants during tests than in real-world driving conditions.
READ MORE: VW Canada suspends sale of some models as emissions probe widens
Other criminal inquiries into car manufacturers have yielded huge fines and forced companies to change their corporate culture.
Last Thursday General Motors agreed to pay $900 million in a deal with the U.S. officials in which it admitted a problem with ignition switches was hidden from the public for more than a decade, leading to more than 160 deaths.
Last year Toyota agreed to a $1.2 billion penalty from the Justice Department after admitting it hid information about defects that caused Toyota and Lexus vehicles to accelerate unexpectedly, resulting in injuries and deaths.
Volkswagen Canada has suspended the sale of several diesel models amid the revelations the German car manufacturer rigged emissions tests for almost 500,000 diesel cars in the U.S.
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“Volkswagen Canada has issued a stop sale order for all vehicles affected by this issue,” Thomas Tetzlaff, a VW Canada spokesperson said in a statement.
The affected diesel models in Canada include:
- The VW Jetta — model years 2009-15.
- The VW Golf — from 2010-15.
- The VW Beetle — from 2013-15.
- The VW Passat — from 2012-15.
The EPA found several lines of code, or “defeat devices,” in the diesel-powered VWs, allowing them to bypass emission controls.
“A sophisticated software algorithm on certain Volkswagen vehicles detects when the car is undergoing official emissions testing, and turns full emissions controls on only during the test,” the EPA said in its violation notice.
READ MORE: VW chief ‘deeply sorry’ for rigging cars to violate U.S. pollution laws
Volkswagen stock plunged by more than 17 cent Monday amid news that VW could face fines of up to $18 billion US, according to the EPA.
CEO of Volkswagen Martin Winterkorn apologized on Sunday “for breaking the trust of our customers and the public.”
On Monday, the Merchant Law Group LLP, with ten offices across Canada, announced it’s filing a national class action over the emissions scandal.
“VW had marketed its diesel-powered cars as being better for the environment,” the law firm said in a statement.
“The EPA indicates the VW cars under investigation seemed to pass emissions tests but in the real world were actually emitting up to 40 times the national standard for nitrogen oxide, which is linked to asthma and lung illnesses.”
Lawyer Tony Merchant said VW owners who have contacted the firm are “furious.”
“They paid a premium price intending to buy vehicles that were better for the environment and now find out their cars are among the dirtiest of polluters.”
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