The U.S. Securities and Exchange Commission (SEC) has opened an investigation into Volkswagen for an April Fools’ Day prank under which the company was supposedly changing its name to “Voltswagen”.
At the end of last March, Volkswagen surprised everyone by announcing with great fanfare that it was going to change its name to “Voltswagen” with the ultimate goal of underlining its commitment to sustainability. As some people predicted from the beginning, the whole thing turned out to be an April Fools’ Day joke.
The prank made many people feel ashamed and even brought out the human bad guys of “diesel gate”. But the farce over the alleged name change of the Teutonic automaker is not only unfunny, but it could also end up causing Volkswagen some serious headaches.
Not surprisingly, the U.S. Securities and Exchange Commission (SEC) has opened an investigation into the German company for the controversial prank. The SEC will now have to decide whether or not the hoax affected the value of Volkswagen shares and whether it violated any stock market regulations.
According to Spiegel, those in charge of the investigation, which is still at an early stage, asked Volkswagen in early April for all information relevant to the case. And it appears that the company is cooperating with U.S. authorities.
The hoax could have influenced the value of Volkswagen’s shares
The episode, which eventually turned into a real “soap opera”, began on March 29, when a press release was leaked (apparently accidentally) that announced the change of Volkswagen’s name in the United States (where it would be renamed Voltswagen).
Everything pointed to such an occurrence being nothing more than a joke, but Volkswagen‘s North American subsidiary ended up confirming the name change in an official statement. And soon after, despite the company’s efforts to tie up every last detail of its joke (more of a joke than anything else), it became known that it was all a lie from the beginning.
Even though everything smelled fishy from the beginning, the truth is that the value of Volkswagen’s American Depositary Receipts (ADR) plunged 12.5% after learning of the company’s name change.
And although it seems bold to venture that the farce was ultimately aimed at inflating the price of Volkswagen shares, the investigation now undertaken by the SEC could result in a resounding slap in the face for the company, which will probably think twice before making tasteless jokes in the future.
