MUNICH -- Volkswagen Group's former top engineer, Wolfgang Hatz, has been arrested by German prosecutors in connection with the automaker's diesel-rigging scandal, press reports said.
Hatz was a close ally of former VW Group CEO Martin Winterkorn and, if confirmed, his arrest would make him the highest VW employee taken into custody by prosecutors, who earlier this year arrested an Audi engineer.
Hatz worked for Audi and Porsche during his career. He was VW Group's powertrains chief during the time the automaker developed and sold diesel engines manipulated to cheat tests for NOx emissions.
On Thursday, Munich prosecutors said they had arrested a second person in connection with Audi's part in VW Group' emissions scandal but did not name the suspect.
The Munich-based Sueddeutscher Zeitung, in a joint report with German television stations NDR und WDR, said the suspect was Hatz, who is being held without bail as a flight risk. The New York Times said two sources with knowledge of the arrest had confirmed the suspect was Hatz, who worked closely with current VW Group CEO Matthias Mueller while the two executives worked at Porsche.
Audi said it has no knowledge of the arrest and continues to cooperate with authorities.
Audi admitted in November 2015, two months after parent VW Group's diesel emissions scandal broke, that its 3.0-liter V-6 diesel engines were fitted with an auxiliary control device deemed illegal in the United States.
Hatz was Audi's head engine developer from 2001 until 2007 when he was promoted to VW Group powertrain chief. He gave up the post in 2012 to focus on his Porsche r&d job that he added in 2011.
In March, Munich prosecutors searched offices at the carmaker's headquarters in Ingolstadt Germany, where about 44,000 workers are employed, and the premises of Jones Day, a U.S. law firm hired by VW to lead an investigation into the emissions scandal.
U.S. authorities are seeking to extradite former Audi manager Giovanni Pamio who was arrested in Germany in July in connection with the diesel investigation. Pamio remains in custody pending ongoing German investigations. He has been charged in the U.S. with conspiring to defraud U.S. regulators and consumers through software designed to cheat emissions tests in thousands of Audis.
Last month, former VW Group engineer James Liang was sentenced to 40 months in a U.S. federal prison and a $200,000 fine for his role in the scandal.
Oliver Schmidt, a former VW executive, who has pleaded guilty in federal court in Detroit in connection with the scandal will be sentenced on Dec. 6. He faces up to seven years in prison and a fine of up to $400,000 after admitting to conspiring to mislead U.S. regulators and violating clean air laws.
Reuters contributed to this report
