WASHINGTON, March 15 (Reuters) - Volkswagen Group of

America's wholly owned finance unit has agreed to pay $48.75

million to resolve a government lawsuit that accused the German

automaker and its former CEO of defrauding investors in U.S.

bond offerings.

The Securities and Exchange Commission filed a civil lawsuit

in March 2019 accusing Volkswagen AG, two

subsidiaries and former chief executive Martin Winterkorn of

defrauding investors. The SEC is dismissing claims against

Volkswagen AG and Winterkorn.

The settlement with Volkswagen Group of America Finance

filed Friday marks the last significant legal action related to

the diesel emissions scandal in the United States.

This cost the German automaker more than $20 billion in

fines, penalties and settlements after it admitted in 2015 it

had cheated emissions tests by installing "defeat devices" and

sophisticated software in nearly 11 million vehicles worldwide.

Volkswagen in 2017 pleaded guilty to criminal conduct as

part of a $4.3 billion Justice Department settlement and offered

to buy back about 500,000 polluting U.S. vehicles.

A Volkswagen spokesperson said its finance unit was "pleased

to have reached an agreement with the SEC". The settlement

requires approval by a U.S. judge in San Francisco. The VW

finance unit did not admit or deny the SEC allegations.

The SEC, which did not immediately comment Friday, had

sought about $350 million plus interest.

The SEC complaint said from April 2014 to May 2015,

Volkswagen issued more than $13 billion in bonds and

asset-backed securities in U.S. markets when senior executives

knew more than 500,000 U.S. vehicles dramatically exceeded legal

vehicle emissions limits.

VW could have faced another $350 million if civil penalties

had been imposed.

The settlement includes $34.35 million and interest of $14.4

million that will be distributed by the SEC to investors in the

2014 and 2015 bond offerings.