In order to complete a voluntary recall that cost the company over $26 million, Volkswagen paid a $1.1 million penalty for failing to promptly notify the EPA of a defective oxygen sensor in their vehicles

Risk Management, Sept, 2005

In order to complete a voluntary recall that cost the company over $26 million, Volkswagen paid a $1.1 million penalty for failing to promptly notify the EPA of a defective oxygen sensor in their vehicles. The problem affected 329,000 of the company's 1999 to 2001 Golfs, Jettas and Beetles causing the vehicles to emit excess pollutants.

Volkswagen did not notify the EPA until more than a year after the defect was discovered and has pledged to improve its defect investigation process and reporting system to ensure future compliance.