The U.S. Justice Department is expanding its diesel emissions probe of Volkswagen and has sent the German automaker a subpoena under a bank fraud law, The Wall Street Journal reported Tuesday.
The Justice Department is looking at possible violations of tax laws and issued the subpoena under the Financial Institutions Reform, Recovery and Enforcement Act, or FIRREA, to pursue possible wrongdoing at Volkswagen, the newspaper said, citing people familiar with the probe.
The subpoena is seen as a novel use of the civil financial fraud law that the Obama administration deployed to extract record-setting multibillion-dollar settlements from big banks in the wake of the 2008 financial crisis.
It suggests the car maker faces another potential source of penalties after admitting it used illegal software that allowed diesel-powered vehicles to pollute more on the road than during government emissions tests.
VW spokeswoman Jeannine Ginivan declined to comment on talks with regulators, but said the automaker "will continue to cooperate with all relevant government agencies."
The Justice Department in January sued VW for up to $46 billion for violating U.S. environmental laws. Settlement talks are still ongoing between the Justice Department, EPA and California Air Resources Board that could include buyback offers and fixes for vehicles.
The Journal also reported Tuesday that Volkswagen officials told a federal judge they will not be able to meet March 24th deadline for getting an approved fix to the emissions violations on its diesel-powered engines. VW has not been able to sell its 2016 diesel models, including its Chattanooga-made diesel Passats, because of the air emission violations.