Audi chief executive Rupert Stadler has been arrested on suspicion of fraud in connection with parent company Volkswagen’s ‘dieselgate’ emissions cheating scandal, German prosecutors said on Monday.
The dramatic development comes a week after Munich prosecutors raided Stadler’s home after charging him with fraud and the falsification of documents that allowed diesel vehicles equipped with cheating software to be sold to European customers.
Prosecutors said the arrest was justified because of the risk of concealment of evidence.
Audi confirmed the arrest.
“For Mr Stadler, the presumption of innocence continues to apply,” a spokesman said in a statement.
Stadler’s arrest is the most high-profile yet in the dieselgate crisis, which started when the Volkswagen group admitted in 2015 to equipping some 11 million diesels worldwide with defeat devices designed to dupe pollution tests.
VW’s luxury subsidiary Audi has long faced suspicions that its engineers developed the software used in the scam.
Audi’s former head of engine development was taken into custody in September 2017.
German authorities earlier this month ordered the recall of some 60,000 Audi A6 and A7 cars across Europe to remove illegal emissions control software, using a different technique however than the one at the heart of dieselgate.
Former VW chief executive Martin Winterkorn stepped down soon after the scandal broke in September 2015, while successor Matthias Mueller was hastily replaced earlier this year.
Both are suspected of knowing earlier than they have so far admitted about the cheating, meaning they may have failed in their duty to inform investors in the car giant about the financial risks.
US prosecutors also indicted Winterkorn last month, saying he knew of the company’s emissions cheating as early as May 2014 but decided to continue.
Present boss Herbert Diess has been accused of knowing about diesel cheating before it became public, an allegation rejected by the firm last month.
The scandal has so far cost the VW group more than 25 billion euros (an equivalent of $29 billion) in buybacks, fines and compensation, and the company remains mired in legal woes at home and abroad.