A federal judge in Detroit sentenced former engineer James Liang to 40 months in prison on Friday for his role in Volkswagen AG's multiyear scheme to sell diesel cars that generated more pollution than U.S. clean air rules allowed.
U.S. District Court Judge Sean Cox also ordered Liang to pay a $200,000 fine, 10 times the amount sought by federal prosecutors. Cox said he hoped the prison sentence and fine would deter other auto industry engineers and executives from similar schemes to deceive regulators and consumers.
Liang was part of a long-term conspiracy that perpetrated a "stunning fraud on the American consumer," Cox said, as the defendant's family looked on in the courtroom. "This is a very serious and troubling crime against our economic system."
Liang pleaded guilty earlier this year to misleading regulators, and had cooperated with U.S. law enforcement officials investigating Volkswagen.
Prosecutors last week recommended that Liang, 63, receive a three-year prison sentence, reflecting credit for his months of cooperation with the U.S. investigation of Volkswagen's diesel emissions fraud. Liang could have received a five-year prison term under federal sentencing guidelines. Liang's lawyers had asked for a sentence of home detention and community service.
Liang can appeal the sentence, Cox said.
Volkswagen pleaded guilty in March to three felony charges under an agreement with prosecutors to resolve the U.S. criminal probe of the company itself. It agreed to spend as much as $25 billion in the United States to resolve claims from owners and regulators and offered to buy back about 500,000 vehicles.
Volkswagen has admitted that it used software to deceive regulators in the United States and Europe from 2006 to 2015. The ruse allowed the automaker to sell diesel-equipped cars and sport utilities without installing emissions control systems that could have compromised performance or posed an inconvenience to customers, prosecutors charged.
Prosecutors said the deception lasted a decade and first impacted vehicles in the 2009 model year in the United States.
The German automaker declined to comment on Liang's sentence on Friday. "Volkswagen continues to cooperate with investigations by the Department of Justice into the conduct of individuals. It would not be appropriate to discuss personnel matters," the company said in a statement.