Oct 26 (Reuters) – Fiat Chrysler Automobiles (FCA) is nearing an agreement to plead guilty to criminal conduct to resolve a multiyear emissions fraud probe surrounding Ram pickup trucks and Jeep sport-utility vehicles with diesel engines, people familiar with the matter said.
FCA lawyers and U.S. Justice Department officials are brokering a plea deal that could be unveiled in coming weeks and include financial penalties totaling between $250 million and $300 million, the people said.
The FCA investigation focuses on roughly 100,000 diesel-powered vehicles that allegedly evaded emissions requirements. The plea negotiations are fluid and some terms, including the size of any financial penalties, could change as discussions continue, the people said.
A plea agreement would cap a series of investigations dating back to 2015 surrounding diesel-powered vehicles in FCA’s U.S. lineup. The current criminal investigation targets the U.S unit of the Italian-American automaker. The affected vehicles span model years 2014 to 2016.
The scandals over emissions cheating tarnished diesel technology and accelerated the industry’s shift to electric vehicles.
Now, automakers are accelerating battery electric vehicle development to comply with tougher, post-Dieselgate pollution standards.
The FCA discussions are heating up as one of its employees prepares to face trial next year on charges he misled regulators about pollution from the vehicles, and continued the deception even after officials caught Volkswagen cheating on government emissions tests.
An indictment alleges the employees conspired to install illegal software known as defeat devices in vehicles so they could dupe government emissions tests and then pollute beyond legal limits on roadways.
Other legal troubles have also dogged the automaker. In March, the company pleaded guilty to violating U.S. labor law, admitting it conspired to make illegal payments to union officials.
In the emissions probe, the criminal case against FCA is expected to track closely with one against Volkswagen that the Justice Department unveiled in 2017, the people said.
Volkswagen agreed to pay $2.8 billion to resolve that criminal case, and billions of dollars more to settle Justice Department civil allegations and lawsuits from vehicle owners and state officials.
The automaker instead argued for a so-called deferred prosecution agreement, the people said. In such agreements, a company is criminally charged and agrees to monitoring and other conditions instead of pleading guilty. If the company abides by the agreement, prosecutors later ask a judge to dismiss the charges.
Justice Department officials rejected FCA’s request for the more lenient treatment.
In talks with U.S. prosecutors, FCA has emphasized the automaker’s January 2019 agreement to pay roughly $800 million to settle civil litigation brought by the Justice Department, state officials and consumers alleging the company’s vehicles evaded emissions requirements, one of the people said.
Separately, FCA this year resolved legal claims from customers who opted out of the earlier settlement with consumers, according to court records.
