Photographer: Daniel Acker/Bloomberg

VW's Porsche Brand Probed as Diesel Fraud Scandal Spreads

  • Stuttgart prosecutors open formal fraud investigation
  • Roles of employees at German and U.S. units being reviewed

Volkswagen AG’s Porsche brand faces a formal probe by German prosecutors as the diesel-emissions scandal spreads to VW’s iconic sports-car maker.

Prosecutors in Stuttgart said they were escalating an informal investigation started last year into allegations the Porsche brand may have defrauded consumers by selling autos with software that manipulated emissions.

While no individual suspects were named, investigators are looking into the role of employees at the Porsche brand in Germany and the U.S., Jan Holzner, spokesman for Stuttgart prosecutors, said in an emailed statement on Monday.

VW admitted in September 2015 that about 11 million diesel cars worldwide were fitted with so-called defeat devices -- embedded algorithms used to game emissions tests. The company is now facing three separate diesel-fraud probes in its home country. Braunschweig prosecutors are investigating 37 suspects at Volkswagen, while Munich counterparts are looking into an unidentified number of suspects at the Audi unit, one of whom was arrested a week ago. VW has also faced criminal probes abroad, including the U.S.

The Porsche brand’s press office didn’t immediately reply to an email seeking comment.

The brand is the sports car-making unit owned by VW. It’s separate from Porsche Automobil Holding SE, a listed company whose main asset is a majority share in VW.

The former Audi manger who was arrested last week has been talking to prosecutors, Andrea Grape, spokeswoman for Munich prosecutors said in an interview. She declined to provide more details.

His lawyer Werner Lechner didn’t immediate reply to a call seeking comment. Sueddeutsche Zeitung reported the manger’s willingness to talk to investigators earlier on Monday.

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