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story.lead_photo.caption Environmental Protection Agency (EPA) Administrator Andrew Wheeler speaks, left, as Deputy Attorney General Jeffrey Rosen and looks on, during a news conference at the Justice Department in Washington, Monday, Sept. 14, 2020. Automakers Daimler AG and subsidiary Mercedes-Benz USA have agreed to pay $1.5 billion to the U.S. government and California state regulators to resolve emissions cheating allegations. (AP Photo/Susan Walsh, Pool)

WASHINGTON -- Automaker Daimler AG and subsidiary Mercedes-Benz USA have agreed to pay $1.5 billion to the U.S. government and California state regulators to resolve emissions cheating allegations, officials said Monday.

The U.S. Department of Justice, Environmental Protection Agency and the California attorney general's office say Daimler violated environmental laws by using so-called defeat device software to circumvent emissions testing and sold about 250,000 cars and vans in the U.S. with diesel engines that didn't comply with state and federal laws.

The settlement, which includes civil penalties, will also require Daimler to fix the vehicles, officials said. In addition, the company will pay $700 million to settle U.S. consumer lawsuits.

The Stuttgart, Germany-based automaker said on Aug. 13 that it had agreements with the Justice Department, Environmental Protection Agency, Customs and Border Protection, the California Air Resources Board and others over civil and environmental claims involving about 250,000 diesel cars and vans.

[Video not showing up above? Click here to view » https://www.youtube.com/watch?v=ehCsq9MKyGM]

Environmental Protection Agency Administrator Andrew Wheeler said Daimler did not disclose all of its software, which included "devices designed to defeat emissions controls."

In a statement, Daimler said it denies the allegations that it cheated and does not admit to any liability in the U.S. The settlements resolve civil proceedings without any determination that Mercedes and Daimler vehicles used defeat devices, the company said. Plus, Daimler said it did not receive a notice of violation of the Clean Air Act from the EPA or California regulators, which is common when defeat devices are used.

The company said it is not obligated to buy back the vehicles, as Volkswagen was, nor will it have an independent monitor to track its progress on the settlement. "By resolving these proceedings, Daimler avoids lengthy court actions with respective legal and financial risks," the company said.

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Deputy Attorney General Jeffrey Rosen, right, and Environmental Protection Agency (EPA) Administrator Andrew Wheeler, left, speaks during a news conference at the Justice Department in Washington, Monday, Sept. 14, 2020. Automakers Daimler AG and subsidiary Mercedes-Benz USA have agreed to pay $1.5 billion to the U.S. government and California state regulators to resolve emissions cheating allegations. (AP Photo/Susan Walsh, Pool)
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Susan Parker Bodine, Environmental Protection Agency (EPA) Assistant Administrator for Enforcement and Compliance Assurance, speaks, as EPA Administrator Andrew Wheeler, left, and Deputy Attorney General Jeffrey Rosen, right, look on, during a news conference at the Justice Department in Washington, Monday, Sept. 14, 2020. Automakers Daimler AG and subsidiary Mercedes-Benz USA have agreed to pay $1.5 billion to the U.S. government and California state regulators to resolve emissions cheating allegations. (AP Photo/Susan Walsh, Pool)
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Deputy Attorney General Jeffrey Rosen speaks, as Susan Parker Bodine, Environmental Protection Agency (EPA) Assistant Administrator for Enforcement and Compliance Assurance, left, and EPA Administrator Andrew Wheeler, center, look on, during a news conference at the Justice Department in Washington, Monday, Sept. 14, 2020. Automakers Daimler AG and subsidiary Mercedes-Benz USA have agreed to pay $1.5 billion to the U.S. government and California state regulators to resolve emissions cheating allegations. (AP Photo/Susan Walsh, Pool)
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Jeff Clark, Assistant Attorney General for the Environment and Natural Resources Division, speaks as Deputy Attorney General Jeffrey Rosen, right, and Environmental Protection Agency (EPA) Administrator Andrew Wheeler, left, look on during a news conference at the Justice Department in Washington, Monday, Sept. 14, 2020. Automakers Daimler AG and subsidiary Mercedes-Benz USA have agreed to pay $1.5 billion to the U.S. government and California state regulators to resolve emissions cheating allegations. (AP Photo/Susan Walsh, Pool)
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Jeff Clark, Assistant Attorney General for the Environment and Natural Resources Division, speaks during a news conference at the Justice Department in Washington, Monday, Sept. 14, 2020. Automakers Daimler AG and subsidiary Mercedes-Benz USA have agreed to pay $1.5 billion to the U.S. government and California state regulators to resolve emissions cheating allegations. (AP Photo/Susan Walsh, Pool)

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