https://www.cnn.com/2019/03/15/business/volkswagen-winterkorn-sec-emissions/index.htmlThe US Securities and Exchange Commission is suing Volkswagen, accusing the German carmaker of carrying out "a massive fraud" by cheating on emissions tests.
The American market regulator said late Thursday that Volkswagen (VLKAF) and former CEO Martin Winterkorn fraudulently raised billions of dollars from investors, including by overplaying the firm's environmental credentials.
If you allow every Federal agency to sue somebody, that's like 4,000 lawsuits. If half of them are on holiday.SEC is not the EPA. Different crimes. Like a felon robbing a bank with a gun. I think there are at least two crimes there. And if the getaway car was parked in a no parking zone, there's a third.
The SEC charges may result in hundreds of millions in fines, not billions. From the article:VW already lost billions, and the SEC is going to sue them making billions?
The lawsuit alleges that the company made false and misleading claims about its financial health and the environmental impact of its technology in order to sell the securities to investors at inflated prices.
The SEC alleges that senior Volkswagen executives were aware when the securities were sold that more than 500,000 of the company's vehicles in the United States breached vehicle emissions limits.
"By concealing the emissions scheme, Volkswagen reaped hundreds of millions of dollars in benefit by issuing the securities at more attractive rates for the company," the SEC said in a statement. The complaint targets Volkswagen, two of its US subsidiaries and Winterkorn.
The SEC is seeking to recover "ill-gotten gains" from the automaker and impose civil penalties.
what stocks are now has no bearing on this investigation, it is what the value was at the time the infraction occurred.They would have to prove damages. The stock is down from highs but so is almost every other auto stock with the down turn in auto industry. Would have to prove it's because of cheating rather than market forces.
Not now but if they can't prove any stock devaluation after cheating was revealed was caused by with holding information and not by market conditions they are out of luck. That's why the VW response.what stocks are now has no bearing on this investigation, it is what the value was at the time the infraction occurred.
You are conflating later events. The SEC is claiming VW knew they were cheating the diesel tests and they knew that the image they were projecting of the environmental impact of its technology was predicated on a lie, and that they knew or should have known that the cheating risked a negative impact on sales and liabilities. That's a lot of bad news they deliberately kept from investors. Had investors known, they would not have paid top dollar for the stock. The stock would have been beaten bloody and sold at a lower price.Until the courts decided against VW, they had no obligation to tell shareholders they lost before it went to trial.
Ugghh... It was VW's contention at the time that they broke no laws. Only later did a court make the decision they did. So you are saying VW should have informed the planet directly instead of the hundreds of news stories, that while they consider themselves not guilty, nobody should buy their stock?Nothing to do with stock or stock sales. The issue is when VW raised money thru the sale of bonds or other notes, to fund building a new factory, etc. The idea is that VW got a lower rate of interest than they would have gotten if diesel gate had been known. I suppose bondholders lost some potential interest, but you can't assume the same bondholders would have held VW bonds, if they had a different rating, as many institutional investors are restricted to the quality of bonds they hold.
A SEC fine makes sense, but I'm not sure bondholders will have much success if they decide to do a class-action lawsuit.
Correct, bonds and other cash raising financial instruments, my mistake.Nothing to do with stock or stock sales.
And the bank robber denied robbing the bank.Ugghh... It was VW's contention at the time that they broke no laws.
I have no idea what your post has to do with mine.Ugghh... It was VW's contention at the time that they broke no laws. Only later did a court make the decision they did. So you are saying VW should have informed the planet directly instead of the hundreds of news stories, that while they consider themselves not guilty, nobody should buy their stock?