EU Anti-Fraud Arm Investigating Loans to VW Amid Diesel Scandal

VW Loses Most Market Share in Europe Since Scandal Broke
  • OLAF looks into European Investment Bank loans to carmaker
  • EIB had said in October it was reveiwing how loans were used

The European Union’s anti-fraud office OLAF is investigating loans Volkswagen AG received from the European Investment Bank to produce cleaner engines.

The authorities picked up the issue after EIB chief Werner Hoyer said in October the lender was looking into the loans itself in light of the emissions scandal. The credits were granted to Volkswagen to help fund the development of cleaner engines.

"The fact that OLAF is examining the matter does not mean that the persons or entities involved have committed an irregularity," the authority said in an e-mailed statement Wednesday. "OLAF fully respects the presumption of innocence and the rights of defense of the persons and entities concerned by an investigation."

The probe adds to the long list of investigations the company is facing in the wake of its disclosure in September that it cheated on pollution trials with its diesel cars. The carmaker installed software in some 11 million vehicles worldwide which lowered the level of nitrogen oxides emitted when it detected the car was being tested.

VW hasn’t been informed of the probe and is “astonished that the authority goes public with this information without informing those subject to the issue,” company spokesman Eric Felber said in an e-mailed statement. VW has been talking to the EIB, the EU’s development bank, on the issue for months and has disclosed how the money was used, he said.

Brussels-based OLAF is responsible for investigating fraud, corruption and evasion of taxes, duties and levies that contribute to the EU’s budget.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE