Volkswagen Finance CEO on $5 billion settlement
Volkswagen Finance Chief Executive Matthias Mueller has agreed to pay $5.2 billion to settle allegations that he conspired to manipulate the German automaker’s profit-sharing and incentive programs, Bloomberg reported.
The agreement includes a $1.8 billion payment to settle charges that Mueller’s company illegally shifted the value of financial awards, according to a regulatory filing by the Justice Department.
Mueller was a co-conspirator in the scheme, which included rigging the earnings-reward formula and withholding payments from executives, Bloomberg said.
Mueller’s attorney said in a statement that Mueller would be able to use the settlement to repay former and future employees for any benefits they received as a result of their involvement in the scam.
Volkswagen’s stock plunged after the news broke on Monday.
The automaker announced on Monday that Mueller, who was appointed in February, would leave the company.
Mueller and the company have been under intense scrutiny since a video surfaced showing Mueller, then chief financial officer, instructing subordinates to use company funds to pay off former employees for speaking out about their claims of discrimination and retaliation.
Mueller denied wrongdoing in a letter to employees released by the company on Tuesday.
Volkswagen has been under increasing pressure to address allegations that it unfairly rewards employees who speak out against the company’s management.
The company said Mueller’s departure would save $1 billion over the next three years and improve transparency in its compensation program.
Mueller is expected to remain in his role at Volkswagen through 2018, the automaker said.