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10/12/2016

VW may have used EU funds illegally

Climate & Environment

VW may have used EU funds illegally

Volkswagen may now be facing financial scrutiny.

[Automobile Italia/Flickr]

The European Commission’s anti-corruption division has opened proceedings against Volkswagen. The company could have used EU funding for illegal research. EurActiv Germany reports.

According to a German newspaper report, the European Anti-Fraud Office (OLAF) has started an investigation into VW. Süddeutsche Zeitung broke the story this morning (16 December), citing an OLAF spokesperson in Brussels. Further details were not provided, as the investigation is ongoing.

The authorities are interested in establishing whether VW illegally used EU funding for research and development for other purposes. In VW’s case, the investigation will mostly focus on loans it received from the European Investment Bank (EIB).

>>Read: EU asks members to investigate after VW concedes further irregularities

The EIB has fed the Volkswagen group around €4.6 billion in low-interest loans since 1990. They were provided in order to finance, among other things, environmentally-friendly engines. Süddeutsche Zeitung reported that VW is still yet to repay around €1.8 billion of this sum. VW refused to provide comment on the matter.

Volkswagen is still reeling from the dieselgate scandal, in which the car-maker had to admit in September that an estimated 11 million of its diesel cars had been fitted with “cheat devices” to help the vehicles pass low-emissions tests.