Scandal details
From the fall of 2006 through September 2015, “Liang and his co-conspirators, including current and former employees, and others, agreed to defraud the U.S. and VW customers, and violate the Clean Air Act, by misleading the U.S. and VW customers about whether VW diesel motors complied with U.S. emissions standards,” prosecutors said in the indictment.
According to the documents, Liang was on the team that developed the EA 189 2.0-liter diesel at the center of VW’s emissions scandal. Liang, a VW employee since 1983, began working on the EA189 engine in 2006 while at Volkswagen’s diesel engine development department at the automaker’s headquarters in Wolfsburg, Germany.
Liang and “co-conspirators” working on the engine soon realized it would not meet stricter U.S. limits on nitrogen oxide emissions that took effect in 2007 while also attracting “sufficient customer demand,” Liang’s indictment said.
In turn, Liang and his co-conspirators developed and installed the “defeat device” software to cheat on U.S. emissions tests, the indictment said. The software recognizes when a vehicle is undergoing lab testing and limits nitrogen oxide emissions to artificially-low levels in order comply with U.S. standards.
The software would eventually be used on all of the nearly 500,000 2.0-liter diesel engines sold by VW in the U.S. market from 2009-2015, the Justice Department said.
Liang moved to the United States in 2008 to help launch the new “clean diesel” engine in the U.S. market and was VW’s “Leader of Diesel Compliance” while working at the company’s testing facility in Oxnard, Calif., west of Los Angeles, prosecutors said.
Liang admitted to attending meetings between personnel from VW AG and its U.S. operation and officials from the EPA and California’s Air Resources Board for certifications from the regulators to sell the diesels in the U.S. market, the Justice Department said.
In those meetings, VW personnel hid the existence of the defeat device software and claimed that the diesels complied with U.S. emissions standards, the government said in its statement.
In one such meeting, Liang and other VW personnel met March 19, 2007, with EPA officials in Ann Arbor, Mich., where the agency has its emissions testing lab. Liang and others from VW described software functions of the EA 189 engine that affected emissions controls but concealed the existence of the cheat software from the EPA, according to the indictment.
Liang and VW personnel also concealed the cheat software from CARB in a meeting just days later in El Monte, Calif., the indictment said.
False compliance
VW continued to “falsely and fraudulently certify to EPA and CARB” that VW’s diesel vehicles complied with U.S. emissions standards and the Clean Air Act, the Justice Department said.
Liange also admitted that he and others at VW falsely marketed the 2.0-liter diesel engines as “clean diesel” and environmentally-friendly, the government said.
As part of his guilty plea, Liang admitted to helping “his co-conspirators continue to lie to the EPA, CARB and VW customers even after the regulatory agencies started raising questions,” the Justice Department said.
As vehicles equipped with the cheat software aged, they saw elevated rates of warranty claims related to the emissions control, according to the indictment.
In 2014, Liang and others involved issued a software update for the diesels that claimed to be “intended to improve the vehicle,” according to the indictment.
In fact, the update altered the cheat software to use the angle of the steering wheel to more easily detect when it was undergoing official testing, “thereby improving the defeat device’s precision” as a way to reduce stress on the emissions control systems, according to the indictment.
VW managed to conceal on-road NOx emissions that were far above permissible levels in its diesels until March 2014, when West Virginia University published a study showing NOx emissions of three VW diesels significantly exceeded U.S. standards.
The findings prompted CARB and EPA officials to probe the cause of the excess emissions and press VW for answers. Liang and others attempted to blame the excess emissions on “innocent mechanical and technological problems” while “secretly knowing” that the cheat software was the culprit, according to the indictment.
