Monday

18th Mar 2019

Investigation

EU probe into VW loan remains opaque

  • Volkswagen equipped millions of diesel engines with defeat devices (Photo: Volkswagen)

There is a lot of uncertainty surrounding the conclusion of an anti-fraud investigation into a €400-million European Investment Bank (EIB) loan provided to Volkswagen, which cheated on EU vehicle emission tests.

The EU's anti-fraud office, Olaf, finished its investigation in late July, but does not want to comment on the record about what it found.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... or join as a group

  • Last January, EIB chief Hoyer said the bank had 'not found any indication' its loans to Volkswagen had been misused. Seven months later, he said the EIB never concluded its own probe (Photo: EIB)

When this website asked the Olaf press office whether it would publish the report, it was told to ask the EIB. The EIB then referred back to Olaf.

“Olaf has produced the report. Hence it is Olaf’s decision to publish or not publish the report,” an EIB official told EUobserver on Thursday (24 August).

The EIB did not want to comment on the record, but made the official available to respond anonymously.

On 31 July, news website Politico reported that Olaf had concluded that Volkswagen acquired the EIB loan through “fraud” and “deception.”

Olaf's press office did not want to go on the record to confirm or deny that press report, based on anonymous Olaf sources. However, it did provide a statement that hinted at misconduct.

“Olaf sent its final report and a judicial recommendation to the German national authorities, namely the public prosecutor’s office in Braunschweig, Germany,” it said.

Braunschweig prosecutors are leading the investigation into Volkswagen's suspected emissions fraud.

Disappointed

The EIB has confirmed publicly that it has been "misled" by the German carmaker.

EIB president Werner Hoyer gave a statement on 1 August, revealing one of the report's conclusions.

“We are very disappointed at what is asserted by the Olaf investigation, namely that the EIB was misled by VW about the use of the defeat device,” said Hoyer.

Volkswagen used defeat devices in millions of diesel cars to pass EU emissions tests. According to the Politico article, the car company used the EIB loan to finance work on the EA 189 diesel engine, which contained a defeat device.

“We still cannot exclude that one of our loans … was linked to emission control technologies developed at the time the defeat software was designed and used,” said Hoyer.

No indication of fraud?

That was a very different approach compared to what Hoyer said last January, at the EIB's annual press conference.

“We have not found any indication that our loans might have been used for fraudulent purposes, which are the source of the problem for Volkswagen” Hoyer told journalists on 24 January.

“As far as we know - and we have investigated very, very thoroughly - our loans to Volkswagen have not been abused,” he added.

In August, however, Hoyer said “the EIB had not concluded its own investigation of the case”.

The bank chief has now said that the internal probe was put on hold “to avoid duplication” with Olaf's inquiry, something that he did not mention in the January press conference when he implied all investigating had been concluded.

Anti-fraud policy

The case raises questions about the bank's implementation of its anti-fraud policy, something Olaf's press office highlighted.

“Olaf recommended that the European Investment Bank (EIB) take active steps in implementing their anti-fraud policy,” Olaf said.

That advice implies that the EIB had until now not implemented its anti-fraud policy, at least not to the fullest extent.

Hoyer, however, said that the EIB “needs no encouragement to apply the provisions of its anti-fraud policy wherever relevant”.

The anonymous EIB official said the bank is now discussing what can be learned from the VW case.

The Volkswagen loan had already been paid back. Taxpayer money is usually not involved because the EIB borrows from the open market, backed by member states' guarantees.

EIB silent on report into 'fraudulent' VW loan

European Investment Bank vice-president Taylor tells EUobserver the fraud investigation into a €400 million EIB loan to Volkswagen had 'considerable ramifications', but didn't want to explain why the report was kept secret.

EIB 'more sensitive' to fraud after Dieselgate

The president of the European Investment Bank, Werner Hoyer, said the bank had high standards - but did not explain why an anti-fraud report on a loan to Volkswagen was being kept secret.

MEPs want Volkswagen EU loan fraud report published

The European Investment Bank has kept a report explaining how it was tricked into giving Volkswagen Group a €400m loan secret. MEPs want to make it public, plus a paper with recommendations on how to prevent future deceptions.

EU investment bank rejects MEPs' plea for VW fraud report

European Investment Bank cites privacy and ongoing investigations as reasons for refusing to release an anti-fraud report into how it lent €400m to Volkswagen, while the company was rigging emission tests.

News in Brief

  1. Third Brexit vote this week only if DUP will support it
  2. Germany's two largest banks confirm merger talks
  3. Serbian pro-democracy protests reach 15th week
  4. 'Yellow Vest' riots leave Paris shops vandalised
  5. European woman older when having first baby
  6. Majority of Germans want Merkel to stay on
  7. Asylum applications in the EU down to 580,800 in 2018
  8. Children's climate school strikes turn global on Friday

Stakeholders' Highlights

  1. Nordic Council of MinistersNew Secretary General: Nordic co-operation must benefit everybody
  2. Platform for Peace and JusticeMEP Kati Piri: “Our red line on Turkey has been crossed”
  3. UNICEF2018 deadliest year yet for children in Syria as war enters 9th year
  4. Nordic Council of MinistersNordic commitment to driving global gender equality
  5. International Partnership for Human RightsMeet your defender: Rasul Jafarov leading human rights defender from Azerbaijan
  6. UNICEFUNICEF Hosts MEPs in Jordan Ahead of Brussels Conference on the Future of Syria
  7. Nordic Council of MinistersNordic talks on parental leave at the UN
  8. International Partnership for Human RightsTrial of Chechen prisoner of conscience and human rights activist Oyub Titiev continues.
  9. Nordic Council of MinistersNordic food policy inspires India to be a sustainable superpower
  10. Nordic Council of MinistersMilestone for Nordic-Baltic e-ID
  11. Counter BalanceEU bank urged to free itself from fossil fuels and take climate leadership
  12. Intercultural Dialogue PlatformRoundtable: Muslim Heresy and the Politics of Human Rights, Dr. Matthew J. Nelson

Stakeholders' Highlights

  1. Platform for Peace and JusticeTurkey suffering from the lack of the rule of law
  2. UNESDASoft Drinks Europe welcomes Tim Brett as its new president
  3. Nordic Council of MinistersNordic ministers take the lead in combatting climate change
  4. Counter BalanceEuropean Parliament takes incoherent steps on climate in future EU investments
  5. International Partnership For Human RightsKyrgyz authorities have to immediately release human rights defender Azimjon Askarov
  6. Nordic Council of MinistersSeminar on disability and user involvement
  7. Nordic Council of MinistersInternational appetite for Nordic food policies
  8. Nordic Council of MinistersNew Nordic Innovation House in Hong Kong
  9. Nordic Council of MinistersNordic Region has chance to become world leader when it comes to start-ups
  10. Nordic Council of MinistersTheresa May: “We will not be turning our backs on the Nordic region”
  11. International Partnership for Human RightsOpen letter to Emmanuel Macron ahead of Uzbek president's visit
  12. International Partnership for Human RightsRaising key human rights concerns during visit of Turkmenistan's foreign minister

Join EUobserver

Support quality EU news

Join us