An engineer who helped develop the engines at the center of the Volkswagen diesel emissions cheating scandal was sentenced to 40 months in prison and a $200,000 fine, becoming the first person in the scandal facing a prison term.
Engineer James Liang was not the “mastermind” behind VW’s Dieselgate scheme. However, authorities said he was a key player involved throughout the years-long effort to cheat U.S. emissions tests and the subsequent cover-up.
Calling Liang an important member of a “massive and stunning fraud,” U.S. District Court Judge Sean Cox cited the potential impact on America’s economy. “This crime is a very serious and troubling crime against our economic system,” Cox said, noting what Liang and Volkswagen had done undermined the trust between buyers and sellers.
Cox said he hoped the prison sentence and fine would deter other auto industry engineers and executives from similar schemes to deceive regulators and consumers.
Liang was part of a long-term conspiracy that perpetrated a “stunning fraud on the American consumer,” Cox said, as the defendant’s family looked on in the courtroom. “This is a very serious and troubling crime against our economic system.”
Liang pled guilty to misleading regulators earlier this year. He had also cooperated with U.S. law enforcement officials investigating Volkswagen.
Prosecutors last week recommended that Liang, 63, receive a three-year prison sentence, reflecting credit for his months of cooperation with the U.S. investigation of Volkswagen’s diesel emissions fraud. Liang could have received a five-year prison term under federal sentencing guidelines.
Liang’s lawyers asked for a sentence of home detention and community service. Liang can appeal the sentence, Cox said.
Volkswagen plead guilty in March to three felony charges under an agreement with prosecutors to resolve the U.S. criminal probe of the company itself. It agreed to spend as much as $25 billion in the United States to resolve claims from owners and regulators and offered to buy back about 500,000 vehicles.
Volkswagen has admitted that it used software to deceive regulators in the United States and Europe from 2006 to 2015.