Australian Consumer Watchdog Sues VW over Emissions Fraud

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Volkswagen Golf

The Australian Competition & Consumer Commission (ACCC) is the latest entity to sue Volkswagen AG following the emissions fraud. The ACCC seeks to persuade the carmaker to publicly admit misconduct, compensate customers, and release corrective advertising over the next five years.

The consumer rights group announced the lawsuit on Thursday. The reason? VW’s Australia arm sold over 57,000 cars equipped with software that masked the real levels of toxic emissions.

“These allegations involve extraordinary conduct of a serious and deliberate nature by a global corporation,”

a spokesperson for the group said Thursday.

The German car maker now faces a series of legal actions including class actions all around the world over the emission scandal. Additionally, its global chief has resigned, while U.S. regulators could force it to pay US$15 billion in settlements.

In Australia, a law firm is already seeking US$75 million in penalties and the full replacement of emissions ‘defeat’ systems in 90,000 cars. Plus, the ACCC doesn’t seem willing to reach a settlement anytime soon.

Volkswagen’s Position

In response to the latest class action lawsuit, Volkswagen said that it doesn’t believe that the action could “practical[ly]benefit” Australian consumers. The automaker explained that it plans to roll out “software solutions” to the faulty systems “soon.”

According to sources familiar with the matter, that could happen by year’s end when the Australian government will approve the solutions. The company, however, declined to provide more details on the fixes.

Volkswagen added in a recent statement that the recall service update takes just 45 minutes and it is completely free.

The ACCC’s Claims

By contrast, the ACCC’s tone is far less relaxed. The group accused VW of actions designed to mislead consumers and the public. The ACCC also said that it had had higher expectations form a company that is doing business with Australian customers.

The consumer watchdog underlined that the car maker did not only break its customers’ trust but it has also breached the country’s consumer legislation. The ACCC now wants penalties, corrective ads, public statements, and reports on facts and costs.

Volkswagen replied that it is reviewing the ACCC’s accusations and claims. It also underlined that in Australia it has 3000 employees in more than 100 dealerships.

VW’s Struggles in the U.S.

Surprisingly, the car maker has been more cooperative with U.S. regulators. And rarely does a firm ignore a regulator’s claims especially when it has ongoing litigation in other states.

In the wake of the scandal the company’s CEO stepped down earlier this year. Plus, Volkswagen must now pay $15 billion under a settlement with the federal government. About $10 billion of this money will go to customers, while $5 billion more will help the research into no-emission cars.

The Australian regulator decided to sue the company after an 11-month-long investigation. Whether the lawsuit will benefit customers or not will be settled in court. Australian courts will settle other issues the ACCC has brought before them. One example is the lawsuit against the Flight Center, which reportedly ordered airlines not to offer lower fares than those on its site

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