German prosecutors have opened an investigation into the former Volkswagen chief executive Martin Winterkorn over allegations of market manipulation in relation to the company’s diesel emissions scandal.

According to the state prosecutor’s office in Braunschweig, there was “sufficient concrete evidence” that Volkswagen had deliberately delayed informing shareholders of last year’s emissions scandal and the potential financial damage it could cause.

The investigation into market manipulation, initiated by a complaint on behalf of the German federal financial supervisory agency BaFin, is focusing on two former VW executives, including Winterkorn, who resigned in September after eight years at the helm. Winterkorn has apologised and said he took full responsibility for the scandal, but so far denies any personal wrongdoing.

While not disclosing the name of the second top executive, a statement on behalf of the Braunschweig prosecutor, Klaus Ziehe, clarified that the current chairman of the supervisory board, Hans Dieter Pötsch, VW’s finance chief at the time of the scandal, was not being investigated.

Seventeen former VW employees, including lower-level managers, are being investigated on suspicion of fraud.

Following accusations by the US environment protection agency (EPA), the German carmaker admitted on 22 September 2015 that 11m of its diesel cars were equipped with software that detected if the vehicle was being driven under lab test conditions, and adjusted itself to reduce emissions of harmful nitrogen oxide (NOx) pollution. Under real-world conditions, the NOx emissions were considerably higher.

The company has since admitted that Winterkorn was informed of the illegal emissions at least a year before, having been sent a memo detailing the cars’ higher nitrogen oxide emissions in May 2014.

In addition, it was revealed on Monday that European commission experts issued warnings about potential emissions test cheating as far back as 2010.

Companies registered on the stock exchange are obliged by law to inform investors of previously unknown events or circumstances that could considerably influence the price of shares.

In its annual report, published on 28 April, VW said it had not understood the full impact of the emissions scandal until the summer.

“According to the assessment at the time by the members of the board of management dealing with the matter, the scope of the costs expected as a result by the Volkswagen Group was basically not dissimilar to that of previous cases in which other vehicle manufacturers were involved, and therefore appeared to be controllable overall with a view to the business activities of the Volkswagen Group,” the report said.



The latest allegations come before VW’s annual shareholder meeting in Hanover on Wednesday, where Winterkorn’s successor, Matthias Müller, former chief executive of VW-owned Porsche, faces scrutiny from investors.

Having reported a net loss of €1.58bn for 2015, the carmaker still went on to pay its 120,000 staff bonuses of €3,950 per head – €474m in total – after pressure from its works committee and the metalworkers’ union.

In the US, the department of justice has demanded up to $46bn for the violations – a fine so large that some have speculated it may drive VW out of the American market.



