Allegedly it was a company set up

Allegedly it was a company set up by Mr Schuster and the money has reportedly since disappeared. VW denies all wrongdoing and has hired the auditors KPMG to go through the books. As more VW heads rolled,observers said, with an 18 per cent share in VW owned by the state of Lower Saxony, it would only be a matter of time before the scandal spread to politics. Sure enough, this week, the influential weekly news magazine Focus claimed VW paid for sex parties to buy influence with Schr?'s ruling Social Democratic Party.

An entire floor of the Sex World brothel in Hanover was hired in spring 2001 for an all-night champagne and prostitute-filled romp for Audi workers' council directors One, as yet unnamed, Social Democrat MP was also invited. In one case, Mr Schuster is reported to have demanded the government in the southern Indian state of Andhra Pradesh transfer €2m to a company in the name of "Vashishta Wahan" in order to secure Volkswagen investment. The money was paid but " Vashishta Wahan", it transpired, was nothing to do with VW. When the scandal broke in mid-June and Mr Schuster was fired,he holed up in his luxury VW villa in Prague.

He is already planning his next career move, offering his version of the VW inside story to any publisher who will pay a six-figure sum. Mr Schuster is also at the heart of far more serious allegations that dummy companies were set up to supply Volkswagen and rake in profits for a handful of corrupt VW executives. Mr Schuster, 51, a father of five, is reported to have taken a lover in the form of a Czech actress, Katerina Brozova. The 37-year-old, who posed naked for Playboy, denies things ever went that far, but has been happy to reveal how much "Lambo Schuster" loves his shiny silver Lamborghini. Since the allegations broke last month, he has resigned, nine months earlier than expected, turned off his mobile phone and gone into hiding In Prague, things at VW were much the same. Skoda's human resources manager, Helmut Schuster, a former workers' director at VW who was installed at the VW subsidiary company in 2001, was developing a taste for fast women and faster cars. She told the tabloids she was employed to produce corporate videos.

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