Bernie Madoff
A New Jersey Volkswagen dealer says VW's use of defeat devices to mislead government regulators over diesel engine emissions is worse than the fraud committed by Bernie Madoff, who plead guilty in 2009 to running the biggest Ponzi investment scheme in U.S. history.
Steve Kalafer, an auto dealer Flemington, N.J., told CNBC today that Volkswagen's diesel deception is a major fraud against consumers and VW dealers like himself.
"This scandal, this fraud, makes Madoff look like the minor leagues," he told CNBC.
Madoff, who was sentenced to 150 years in jail, led a fraudulent investment scheme that fraud prosecutors estimated totaled $64.8 billion and affected 4,800 clients.
Worldwide, Volkswagen estimates 11 million of its diesel engine cars made over the past six years included the software to fool government emission tests. VW is developing a fix to recall the faulty vehicles and has stopped sales of the suspected faulty diesel models at all of its more than 600 U.S. car dealers.
VW's stock value has dropped about a third since the scandal broke on Sept. 18.
Kalefer and other VW and Audi dealers across the country have thousands of diesel cars on their lots that they cannot sell because of the stop order from VW not to sell the diesel Passats, Jettas, Beetles, Golfs and the Audi A3 at this time because EPA has determined they can't meet federal emission standards.