Audi CEO Arrested in Diesel Emissions Scandal

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The Volkswagen diesel emissions cheating scandal revealed in the fall of 2015 added its latest villain early Monday morning when Audi CEO Rupert Stadler was arrested. Prosecutors in Munich said last week that they were widening their investigation to include Stadler, and the arrest was made this morning to prevent a potential effort by the CEO to suppress evidence.

A week ago prosecutors searched Stadler’s home and that of Bernd Martens, Audi’s purchasing chief, who had led a task force the company set up to handle the diesel emissions scandal.

According to Automotive News Europe, Stadler had been fingered by several of Audi’s engineers, and last week’s search followed by a month the third raid on Audi offices.

Company officials say they are cooperating with investigators and confirmed Monday that Stadler had indeed been arrested. Porsche, the company that controls both VW and Audi, said that the arrest would be discussed at a supervisory board meeting later today.

The so-called dieselgate scandal involved a piece of software installed in every VW and Audi diesel-powered car that could distinguish between actual driving and emissions testing. When the car was being tested, emissions from the diesel engines were cut enough to enable the cars pass the test. Actual emissions under normal driving conditions were much higher.

Investigators in Germany and the United States found that the company knew about the cheating and fines totaling billions of dollars have been assessed, in addition to recall and repair programs that will cost VW billions more.

In May, the United States filed criminal fraud charges against former VW CEO Martin Winterkorn for his role in the emissions scandal, although he is not likely to answer the charges because Germany does not have an extradition agreement with the United States.

Stadler has been Audi’s CEO since 2007 and before that had been the automaker’s head of finance. In March this year, Audi’s supervisory board recommended that the company’s shareholders retain Stadler, although state prosecutors even then were raiding the company’s offices.