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Top Volkswagen Executives On Trial

The trial of former Volkswagen human resources executive Peter Hartz has ended on Friday, January 26. And the verdict? Hartz received a two-year suspended sentence and a fine. The bribery and corruption case of Peter Hartz was feasted on by journalists and camera teams with matching angry protesters outside the courthouse in the town of Braunschweig.

Peter Hartz was a former top manager of Volkswagen and a member of the IG Metall trade union and the Social Democratic Party (SPD). He was also a special advisor to Chancellor Gerhard Schröder (SPD). He devised the draconian labor market reforms that bear his name. During the trial Peter Hartz was called with various names such as traitor, scoundrel and most of the angry protesters were shouting for him to be put to jail.

Hartz trail was conducted in a rapid speed although he was charged with 44 criminal offenses; among them are bribery, undue influence and breach of fiduciary duty amounting to EUR2.6 million. His initial appearance inside the court only lasted an hour.

After a short deliberation, the chairman of the judges, Gerstin Dreyer , announced that the court has reached a prior agreement with all involved basing on the credible confession of Peter Hartz. He further declared that since Hartz has pleaded guilty on the charges and has confessed the whole truth, punishment would be reduced to a two-year suspended sentence and a fine of not less than EUR300,000. The said decision was ratified last Friday.

Volkswagen has also made it clear that it does not want details of the corruption involving the long standing works council Chairman Klaus Volkert and the other 23 works council members to be aired in open court. Lots of questions are still unanswered. The German public would like to know what Volkert do in return for receiving the questioned "special bonuses" amounting to EUR1.9 million between the years 1995 to 2005. Another mind-boggling question is the payment of EUR399,000 to Volkert's Brazilian lover, what was it for?

"It would have been quite interesting to discuss in the courtroom, or possibly later before the High Court, the question whether the alleged bribing of a works council boss harmed or benefited the enterprise. Perhaps the money paid was worth it. Since every day of industrial peace is worth a great deal of cash," wrote Hans Leyendecker in the Süddeutsche Zeitung.

Hartz Case an Eye-Opener

The scandal that happens in Volkswagen has resulted for the German public to doubt their country's post war system of corporate governance. The felt cheated and betrayed. They also began questioning the system's vulnerability to serious abuse. Under the system called codetermination, labor representatives are allowed by law to obtain half the seats on a company's supervisory board which in turn gives them the opportunity to control management decisions.

As they say power corrupts. The system is not that perfect and so ending up being abused by those in power. Furthermore the chairman is also given an extra vote which gives him the power to tip the scales in votes resulting to the separation of labor and management. This type of system gives the shareholder representatives with the advantage especially in close boardroom battles.

And lastly the Hartz case has become an eye opener to the German public especially since never in their wildest dream did they ever think that such a distinguished man like Peter Hartz that authored Germany's Labor reforms and who is renowned for hitting record breaking targets for exports year after year is involved in one of the country's biggest plunder ever.

Town + Country Volkswagen Unionville Markham - (905) 477-2421

About Volkswagen

Volkswagen Newmarket is the best in terms of its production of legendary cars and quality auto parts like Volkswagen brake hose. Volkswagen and its different vehicles are market leaders and more and more people everyday striving to have one. This popularity is based on the history and trust that Volkswagen has developed in its client base over the years. Volkswagen cars name are very creative and innovate, cars are named after weather conditions, animals and insects.

The Beetle which is an original masterpiece of the German automaker has become the world's best-selling car of all time. Volkswagen's bus was also branded as a symbol of generation while the Golf was deemed by many as a modern masterpiece. All the mentioned vehicles manufactured by Volkswagen have become an indelible part of the cultural and personal lives of millions of people around the world.

Volkswagen was founded in an era where privilege is limited to a few number of people only. And this is exactly what motivates Ferdinand Porsche to come up with the idea of a people's car or Volkswagen in German. It was in the year 1934 when Porsche created the first people's car for Europe and a year later a working prototype was launched.

By the end of 1942, almost 70,000 Volkswagens were produced. Three years after in a swift recovery after the war, Volkswagen produced almost 2,000 vehicles for the Allied Forces and the new German Post Office. The year 1948 was another good year for Volkswagen; it was able to produce 25,000 Volkswagens from its production lines in Wolfsburg. Two Beetles were produced during this year and was shipped to United Sates. A year after another batch of Volkswagens was produced including Volkswagen Karrman convertible which became the best-selling convertible in the world.

The year 1955 has signaled the growth for Volkswagen since it was during this year that the automaker was able to produce a million Volkswagens. Since then it has grown into a world corporation, building factories and working communities in countries like United States, Brazil, and Canada. Volkswagen has not also forgotten to help its fellow countrymen; the German automaker has also put up working communities in major centres in Western Europe.

In less the last fifteen years of the millennium Volkswagen has become a true global force in the auto industry and ranked fourth as the largest automaker in the world following GM, Toyota and Ford. Its acquisition and redevelopment of famous car brands like Audi, SEAT, Skoda and Lamborghini has added to its strength.

Volkswagen Overseas

Volkswagen is making waves overseas. In Dubai, a circulating scam email stating that the recipient has won a huge cash prize plus a new car courtesy of Volkswagen has caused major confusion among people in the UAE. Volkswagen has already released an official statement saying that they have not sent any email containing such message. The German automaker has warned people in the UAE to be careful and not to easily believe such hoax email.

The scam email is believed to originate from Nigeria were scam artist abound. The scam email was believed by many people since it states there that it came from "The Lottery Department, Volkswagen Automobiles". Furthermore, according to the circulating fake emails, the recipient has been selected from more than two hundred fifty thousand email addresses. The winner is said to receive two million pounds or Dh14.4 million plus a Volkswagen car.

The scam email also provides what appears to be a UK telephone number which supposedly winners may contact to get their secret pin code from a Claim officer.

Volkswagen UK has already made a statement saying that the emails circulating in the UAE have no connection with their company and should be ignored at all cost. "Extensive enquiries have revealed this is an online scam originating from Nigeria," Volkswagen said.

The German automaker also stressed that the stated UK number found in the scam email is in fact routes to a Nigerian premium rate number. This means that people who are to call this number will end up with a heavily charged telephone bill. It is believed that it is through the bill from which the scam artist will received his part of the deal.

In other Volkswagen overseas news, in Kula Lumpur, Prime Minister Abdullah Ahmad Badawi said that troubled carmaker Proton and largest German automaker Volkswagen AG are in negotiations but he refused to give details of the deal.

According to Prime Minister Abdullah Ahmad Badawi in an interview with New Straits Times, 'I don't want to comment because it is being negotiated.'

Further reports last week say that Volkswagen has agreed to buy a controlling stake in Proton's manufacturing division. This news has had favorably affected Proton's shares which rose to 13.14pct Friday to 7.75 rgt.

The Malaysian government is under intense pressure to announce details of the said partnership between the losing Proton and Germany's giant Volkswagen. It should be noted that Proton last year lost its status as Malaysia's biggest selling carmaker to its rival Perodoa.

Aside from Volkswagen Richmond Hill, Proton has also tried to negotiate with the US auto giant General Motors as well as with PSA Peugeot Citroen of France. There are also three Malaysian automotive firms that have expressed their interest in taking stakes in the company.

It is interesting to note that the Malaysian government owns 59 pct of Proton in addition to a 43 pct stake held by its investment arm Khazanah Nasional.

Volkswagen and Proton will release their official announcement on February 8, 2007.

About Proton

Proton Holdings Berhad is short for Perusahaan Otomobil Nasional (Malay for National Automobile Enterprise). It is Malaysia's first car manufacturer founded by former Malaysia Prime Minister Mahathir Mohamad in the year 1983. Proton is listed on the Bursa Malaysia.

About Volkswagen

Volkswagen means "peoples' car" in German. It is also considered an icon in the 20th century due to the large number of legendary cars it has produced. As a fact, the German automaker's record is unparalleled in the industry. It was Ferdinand Porsche who has conceived the idea of creating a "people's car". He wants to provide the German public at large with an affordable and quality transport.

However some historians say that it was Adolf Hitler that commissioned Ferdinand Porsche to build a small, inexpensive car. In the year 1934, Porsche has made his first ever masterpiece- a Beetle shaped-sedan that was called Volkswagen (German for people's car). The Beetle made its debut two years later. The war delayed the production of the vehicle until 1949. A year later the beetle shaped sedan became popular and was then known as the Volkswagen Beetle.

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