- German financial regulator to look into carmaker's share drop
- Stock declines after VW admits cheating on tests for years
German financial regulator Bafin will examine the trading of Volkswagen AG shares after disclosure of environmental violations in the U.S. prompted the stock to plummet on Monday.
Bafin will analyze the stock movement "as a matter of routine" before deciding whether to open a probe, Anja Schuchhardt, spokeswoman for the regulator said in an e-mail. The shares fell as much as 23 percent today and were down 20 percent at 130 euros in Frankfurt at 3:55 p.m.
"Like in comparable cases with strong share movements, we look at the VW stock as to insider trading, market manipulation, and Ad-hoc disclosure rules," she said.
The slump came after VW admitted to cheating on U.S. air pollution tests for years, putting pressure on Chief Executive Officer Martin Winterkorn to fix the damaged reputation of the world’s biggest carmaker. VW halted sales of the models involved on Sunday and said it’s cooperating with the probe and ordered its own external investigation into the issue.
The Wolfsburg, Germany-based company admitted to fitting its U.S. diesel vehicles with software that turns on full pollution controls only when the car is undergoing official emissions testing, the Environmental Protection Agency said Friday.
During normal driving, the cars with the software -- known as a “defeat device” -- would pollute 10 times to 40 times the legal limits, the EPA estimated. The discrepancy emerged after the International Council on Clean Transportation commissioned real-world emissions tests of diesel vehicles including a Jetta and Passat, then compared them to lab results.