German prosecutors drop investigation into former Volkswagen CEO Winterkorn

Prosecutors in Stuttgart, Germany have dropped a market manipulation investigation into former Volkswagen CEO Martin Winterkorn, deferring to a criminal case against him in the city of Braunschweig.

Prosecutors in Stuttgart had looked at whether Winterkorn had manipulated markets by postponing the disclosure of VW’s emissions scandal in 2015. The automaker in September that year admitted using defeat devices to evade U.S. diesel emission tests.

Until his resignation in 2015 following the scandal, Winterkorn was both CEO of Volkswagen and of the group’s major shareholder, Stuttgart-based Porsche SE.

A spokeswoman for the Stuttgart prosecutors said the probe has been dropped because any penalty imposed by the court there would have little relevance compared to what could result from the Braunschweig proceedings.

A lawyer for Winterkorn has said his client rejects the charges.

Should the former CEO be acquitted by the Braunschweig court Stuttgart prosecutors may decide to restart their investigation, she said.