Mike Spector, David Shepardson

(Reuters) – Fiat Chrysler Automobiles, (FCA), is closing in on a deal to plead guilty criminal conduct for a multiyear emission fraud probe surrounding Ram pickups and Jeep sport-utility vehicle with diesel engines. This was according to sources familiar with this matter.

According to the sources, U.S. Justice Department officers and FCA lawyers have reached a deal. The plea deal could be announced in weeks. It will include financial sanctions of $250 million-300 million.

Such a resolution would come more than four years after Volkswagen AG (OTC:) pleaded guilty to criminal charges https://www.reuters.com/article/us-volkswagen-emissions/volkswagen-pleads-guilty-in-u-s-court-in-diesel-emissions-scandal-idUSKBN16H1W4 to resolve its own diesel-emissions scandal involving nearly 600,000 vehicles.

FCA’s investigation centers on approximately 100,000 diesel-powered vehicles that were alleged to have avoided emissions regulations. According to people, plea negotiations can change and terms such as financial penalties or the length of the sentences could change during the course of the discussions.

According to people, Justice Department officials are currently preparing paperwork for negotiations with FCA. The intent is to close the plea deal.

An agreement to plead guilty would end a string of investigation that began in 2015 and involved diesel-powered cars within FCA’s U.S. line up. The U.S. division of the Italian-American automaker is the subject of this criminal investigation. Stellantis NV now has it. These vehicles are from model years 2014 through 2016.

Stellantis parent FCA and representatives of the Justice Department were unable to comment.

The discussions are heating up as one of FCA’s employees prepares to face trial next year on charges he misled regulators https://www.reuters.com/article/cbusiness-us-fiat-chrysler-emissions-idCAKBN1W9217-OCABS about pollution from the vehicles, and continued the deception even after officials caught Volkswagen (DE:) cheating on government emissions tests.

The Justice Department in April brought charges against two more FCA employees for alleged fraud regarding emissions. Italian authorities arrested https://www.reuters.com/business/autos-transportation/italys-police-arrest-stellantis-manager-us-diesel-emissions-enquiry-2021-09-29 one of the two additional employees in September.

The indictment states that the employees conspired in installing illegal software, known as defeat devices, in vehicles to deceive government emission tests. This allowed them to pollute roadways beyond legal limits.

FCA was previously able to resolve civil disputes, but denied that it had deliberately tried cheat on emissions testing.

Another legal problem has plagued the automaker. The company pleaded guilty to violating U.S. labour law in March and admitting that it conspired with union officials to make illegal payments.

Other changes have also occurred at FCA, which led to the current plea negotiation in the emission probe. Stellantis was created in the spring of this year by a merger between Stellantis and French Peugeot (OTC.) manufacturer PSA. Stellantis, the biggest U.S. dealer chain, announced that FCA’s previous top boss would be departing to become Chief Executive of AutoNation Inc. (NYSE:).

According to people, in the emissions probe the criminal case against FCA and the Volkswagen case that was unveiled by the Justice Department in 2017 will likely be closely related.

Volkswagen admitted cheating in government emission tests using diesel-powered cars, misleading customers and the U.S. Environmental Protection Agency. German automaker Volkswagen pleaded guilty in the United States to conspiracy to defraud, wire fraud and violation of the Clean Air Act.

Volkswagen paid $2.8 billion for the criminal case and millions more to settle civil claims and lawsuits against Justice Department officials and vehicle owners.

FCA, in contrast, met with top Justice Department officials recently to fight against the demand that they plead guilty.

Instead, the automaker argued for what is known as a deferred prosecution agreement. Instead of plead guilty, companies are criminally charged with the agreement. They agree to monitor and comply with other conditions. Prosecutors may ask for a dismissal of the charges if the company agrees to the terms.

Justice Department officials denied FCA’s request to be treated more lightly.

In talks with U.S. prosecutors, FCA has emphasized the automaker’s January 2019 agreement to pay roughly $800 million to settle civil litigation brought by the Justice Department, state officials and consumers alleging the company’s vehicles evaded emissions requirements, one of the people said.

Court records show that FCA resolved separate legal claims this year from customers who had opted out the earlier settlement with consumers.