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Stefan Jacoby, right, President and CEO of Volkswagen Group of America, Inc., steps out of a Jetta with Tennessee Governor Phil Bredesen on the sidewalk in front of the Hunter Museum in 2008 as they arrive to announce that the German automaker would build a vehicle assembly plant in Chattanooga.

 

Volkswagen's "Clean diesel" claim is sputtering.

The EPA on Friday accused VW of intentionally evading federal emissions laws by employing special software that could have exposed hundreds of thousands of Americans to harmful pollutants.

The German automaker must recall nearly 500,000 cars sold in the U.S. containing the software, including diesel Passats assembled in Chattanooga. Why? Because the Environmental Protection Agency says VW used software intentionally designed to circumvent environmental standards for reducing smog.

In other words, the automaker gamed the system.

In its notice of violation, the EPA claimed that a sophisticated software algorithm — termed a "defeat device" — on certain Volkswagen vehicles detects when the car is undergoing official emissions testing, and turns full emissions controls on only during the test. But during normal driving operations, the cars emit nitrogen oxides, or NOx, "at up to 40 times the standard."

So much for the "clean diesel" claim that VW officials asserted in 2008 when Stefan Jacoby, then-president and CEO of Volkswagen Group of America Inc., drove then-Tennessee Gov. Phil Bredesen in a prototype diesel Jetta to the entrance of the Hunter Museum to announce the new vehicle assembly plant here in Chattanooga.

According to The Associated Press, the automaker was previously censured by the EPA in 2005, paying $1.1 million for failing to notify the EPA about a defective oxygen sensor affecting 329,000 vehicles. It was the largest civil penalty to date for that type of violation, and the recall of those vehicles in 2005 cost VW more than $26 million. Reuters reported Friday that VW faces penalties now of up to $18 billion. VW told the AP it is cooperating with the investigation.

If the EPA allegations prove true, both the government and buyers of 2009-2015 Jettas, Beetles, Golfs and Audi A3s, as well as 2014-2015 Passats, have every right to be angry: Many VW diesel owners bought their cars at least in part because of their perceived impact on the environment. What's more, VW's "clean diesel" TDI engines earned a $1,300 federal tax credit in 2009, the first year affected by the recall.

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