SEC sues VW over emissions scandal

Source: Xinhua | 2019-03-19

US stock regulators are suing Volkswagen over the emissions cheating scandal, alleging the German automaker committed fraud by raising billions in corporate bonds while lying to investors about the environmental impact of its cars.

In a filing in California, the Securities and Exchange Commission said that from April 2014 to May 2015, Volkswagen issued more than US$13 billion in bonds and asset-backed securities in US markets while senior executives knew that more than 500,000 vehicles in the US grossly exceeded legal emissions limits.

By hiding the emissions scheme, Volkswagen reaped hundreds of millions of dollars by issuing securities at more attractive rates, the SEC complaint alleges.

“Issuers availing themselves of American capital markets must provide investors with accurate and complete information,” said Stephanie Avakian, co-director of the SEC’s enforcement division.

“As we allege, Volkswagen hid its decadelong emissions scheme while it was selling billions of dollars of its bonds to investors at inflated prices,” the complaint said. The SEC seeks “disgorgement of ill-gotten gains” with prejudgment interest and civil penalties.