German prosecutors said Tuesday they have charged Volkswagen's current chief executive and chairman as well as its former CEO with market manipulation in connection with the diesel emissions scandal that erupted in 2015.
CEO Herbert Diess, Chairman Hans Dieter Poetsch, and former chief Martin Winterkorn are accused of deliberately informing markets too late about the huge costs to the company that would result from the scandal, prosecutors in the city of Braunschweig said.
That, they said in a statement, meant the executives had improperly influenced the company's share price.
The charges, which Volkswagen rejected, could require Diess to spend significant time on his defense, distracting him at a crucial time for the company, which is trying to move on from the scandal and is recasting its business to focus on new - cleaner - technologies like electric cars.
The prosecutors argued that Winterkorn had been aware of the issue and the potential resulting damage since at least May 2015, Poetsch since June 29 and Diess since July 27.
Each of them should have ordered the release of an ad hoc statement for markets at that point, the prosecutors said.
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However, the scandal only broke when US authorities went public with it on September 18, 2015.
Winterkorn resigned shortly after the scandal became public. Poetsch was chief financial officer at the time and became chairman of the supervisory board in late 2015.
Diess arrived at the company on July 1, 2015, shortly before the scandal broke, and was initially the head of its core Volkswagen brand.
Winterkorn was succeeded as CEO by Matthias Mueller, who was then replaced by Diess in April 2018.
Volkswagen swiftly rejected the charges, saying it had "meticulously investigated" the matter with the help of internal and external legal experts over nearly four years.
"The result is clear: the allegations are groundless," Hiltrud Dorothea Werner, the board member responsible for integrity and legal affairs, said in a statement.
She added that, if the indictment goes to trial, the company is "confident that the allegations will prove to be unfounded."
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