Dieselgate lingers.

Volkswagen AG (VLKAY) shares tumbled in Frankfurt Monday after the world's second-largest carmaker said the CEO of its Audi brand was taken into police custody amid an ongoing probe into Germany's diesel emissions-cheating scandal.

The arrest of Rupert Stadler, who heads Audi, followed the expansion of a probe by prosecutors in Munich looking in to accusations of fraud and false advertizing at VW's luxury brand. It also comes quickly on the heels of a move by prosecutors in the German city of Braunschweig to levy a fine of €1 billion ($1.18 billion) against the carmaker for its role in the emissions-cheating scandal that has plagued the nation's auto sector. 

"We confirm that Mr Stadler was arrested this morning," a VW spokesman was quoted as saying by Reuters. "The hearing to determine whether he will be remanded is ongoing."

VW shares were marked around 1.6% from Friday's close and changing hands at €155.5 by mid-morning in Frankfurt, extending their year-to-date decline to around 4.35%. 

The renewed focus on so-called cheat devices comes just as Germany's automakers attempt to put the 2015 Volkswagen "diesel-gate" scandal, which cost the world's second-largest automaker around $30 billion, behind it as it moves towards faster production of clean-energy vehicles in overseas markets and adjusts to the banning of diesel-emitting cars in some of its biggest domestic cities.

"Following thorough examination, Volkswagen AG accepted the fine and it will not lodge an appeal against it. Volkswagen AG, by doing so, admits its responsibility for the diesel crisis and considers this as a further major step towards the latter being overcome," VW said in a statement that followed the Braunschweig decision last week.

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