Klaus Volkert arrested over VW kickbacks scandal

21st November 2006, Comments 0 comments

21 November 2006, Braunschweig, Germany (dpa) - A key figure in the sex and bribery scandal that has rocked German carmaker Volkswagen AG over the last 18 months has been arrested, prosecutors said Tuesday. The arrest of Klaus Volkert, the former works council chief at Europe's biggest carmaker, follows the move last week by prosecutors to indict a former Volkswagen board member who was also a major figure in the kickbacks. Peter Hartz was accused of sanctioning illegal bonuses that helped fund the lavish

21 November 2006

Braunschweig, Germany (dpa) - A key figure in the sex and bribery scandal that has rocked German carmaker Volkswagen AG over the last 18 months has been arrested, prosecutors said Tuesday.

The arrest of Klaus Volkert, the former works council chief at Europe's biggest carmaker, follows the move last week by prosecutors to indict a former Volkswagen board member who was also a major figure in the kickbacks.

Peter Hartz was accused of sanctioning illegal bonuses that helped fund the lavish lifestyle of the head of the company's works council and his South American mistress.

Hartz, who left the company in July last year, admitted in October to "a criminal responsibility for giving preferential treatment to the former works council head" Volkert.

Prosecutors in the north German city of Braunschweig, near where VW is based, said they had decided to arrest Volkert, who resigned from the works council in the middle of last year, because of concerns about the suppression of evidence.

The VW scandal, which emerged in June last year, originally centred on allegations about the payment of bribes from potential suppliers and the creation of front companies which were used to secure lucrative contracts abroad.

Helmuth Schuster, the personal chief of VW's Skoda operations in the Czech Republic left the company in June last year as the allegations about kickbacks from suppliers began to surface.

But the scandal quickly widened to include claims that the company paid for so-called pleasure trips for work council members so as to keep them on their side. This included allegations about flying around high-class prostitutes.

DPA

Subject: German news

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