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FCA expects to pay $259M in criminal settlement over alleged diesel emissions cheating

Breana Noble
The Detroit News

Fiat Chrysler Automobiles NV disclosed the probable loss for a federal criminal settlement over allegations of cheating on diesel emissions tests to be almost $259 million.

The notice was made in the company's third-quarter financial filing with the U.S. Securities & Exchange Commission after the Italian American automaker this week shared record financial results.

The case against Fiat Chrysler concerns 104,000 Jeep Grand Cherokee SUVs and Ram 1500 pickups from the 2014-16 model years with 3-liter V-6 diesel engines.

An FCA spokesman declined to comment on the discussions, though it would be one piece of a greater case brought against the automaker accusing it of using secret software called defeat devices on vehicles to pass emissions tests. Similar cases have been brought and settled against other automakers, including Volkswagen AG and BMW, and auto supplier Bosch.

The case against Fiat Chrysler concerns 104,000 Jeep Grand Cherokee SUVs and Ram 1500 pickups from the 2014-16 model years with 3-liter V-6 diesel engines.

The company previously paid $800 million in related civil penalties to several government agencies and payments to drivers with affected models. The newly disclosed possible payment is regarding a criminal case. The U.S. Justice Department did not immediately return request for comment on the negotiations.

In September, Fiat Chrysler also agreed with the Securities & Exchange Commission to pay $9.5 million to settle allegations that it misled investors in 2016 on the matter. It did not require FCA to admit guilt, though Emanuele Palma, the company's senior manager of diesel engine calibration, was indicted last year on charges related to claims of the company's use of the software defeat devices.

The automaker, federal regulators have alleged, did not disclose at least eight auxiliary emission control devices on its Jeeps and pickups. Automakers can legally deactivate a vehicle’s emission control system under certain conditions, but regulators require they disclose them when applying for certificates that are needed to sell cars in the U.S.

Volkswagen AG in 2017 pled guilty to using defeat devices to cheat on an emissions test but then allow vehicles to produce more nitrogen oxide than allowed at other times. It agreed to pay a $2.8 billion criminal fine for the scheme that affected 590,000 diesel vehicles.

bnoble@detroitnews.com

Twitter: @BreanaCNoble