Volkswagen engineer indicted in US emissions case

A Germany-based Volkswagen engineer was indicted in Detroit federal court today and pleaded guilty for his role in developing an emissions-cheating device on diesel cars.

James Liang helped develop the diesel engines equipped with illegal emissions test "defeat devices" from the earliest stages, the indictment said.

Liang is expected to cooperate with US prosecutors developing a criminal case in the Volkswagen scandal, a person close to the case said.

"Almost from the beginning of VW's process to design its new 'clean diesel' vehicles, Liang and his fellow co-conspirators designed these VW diesel vehicles not to meet US emissions standards, but to cheat the testing process by making it appear as if diesel vehicles met US emissions standards when, in fact, they did not," the Justice Department said in a 24-page indictment.

Liang worked on the defeat device from November 2006, moving to the US in 2008 as Volkswagen ramped up its marketing of "clean diesel" cars with high fuel efficiency in an effort to win greater market share in the US.

Liang and other VW employees developed a complex software system to keep emissions low when a car was undergoing testing to demonstrate environmental compliance, but to allow them to spew higher emissions on the road, the indictment said.

Liang and others consistently misrepresented the system to federal and state environmental regulators and lied about the issue when regulators probed the discrepancy between the cars' testing and real-world emissions performance, the indictment said.

"Liang and his co-conspirators attempted to make it appear that there were innocent mechanical and technological problems to blame, while secretly knowing that the primary reason for the discrepancy was the defeat device installed in every VW diesel vehicle sold in the United States." Volkswagen settled civil cases in June over cheat devices on 2.0 liter diesel cars in an agreement valued at USD 14.7 billion. The Wall Street Journal reported last month that the German automaker is in talks with the Justice Department to settle a criminal case that could involve significant financial penalties.