Fiat Chrysler Will Pay $800 Million to Settle Emissions Cheating Claims

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Fiat Chrysler Automobiles NV will pay hundreds of millions of dollars to settle a lawsuit brought by the U.S. Justice Department, which alleged some of its diesel-powered vehicles violated clean-air rules, a person familiar with the matter said.

The settlement includes fines and more than $300 million in "consumer relief" and requires Fiat Chrysler to establish a recall program offering motorists an approved plan for modification their emissions systems.

The pact will resolve civil claims by the Justice Department on behalf of the U.S. Environmental Protection Agency that some Jeep Grand Cherokee and Ram 1500 models contain pollution-control software that improperly limits pollution during lab tests while allowing the vehicles to spew excess emissions on the road. The remaining $400 million covers a software update and payments to current and former vehicle owners in amounts that average $2800 per person. The VW scandal extended to some 11 million other vehicles the company sold worldwide and led to US criminal charges against eight people. For example, someone who owned an affected vehicle on January 12, 2017, and who completes the software update will receive $3,075, according to the Plaintiffs' Committee for Fiat Chrysler-Dodge-Jeep EcoDiesel Litigation.

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The Justice Department also opened a criminal investigation into Fiat Chrysler's conduct, and several state attorneys general also were investigating.

This on a day when Fiat Chrysler also agreed to a settlement in the neighborhood of $800 million. The company will also need to pay about $280 million to compensate owners. About 500,000 VW vehicles were involved in the USA cheating scandal.

The other $400 million will be split between consumers and remedy methods.

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"The settlements do not change the company's position that it did not engage in any deliberate scheme to install defeat devices to cheat emissions tests", said the company's statement.

As part of the recall, FCA will update emission control software on the offending vehicles and provide them with an extended warranty.

The expensive reprimand centers around Fiat Chrysler's use of illegal engine-controlled software, which allowed thousands of its diesel-fueled cars to produce false emissions tests results. The Fiat Chrysler settlement does not resolve any criminal allegations, according to Assistant Attorney General Jeffrey Clark.

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