The 48-year-old Schmidt is set to stay in detention until the start of his trial in January 2018, according to the Thursday court ruling. He faces eleven felony counts over accusations that Volkswagen (VW) cheated on emission tests for diesel cars. The fraud and conspiracy charges carry a maximum of 169 years in prison.

"The allegations of fraud and conspiracy in this case are very, very serious," said Judge Sean Cox of the US District Court for Eastern Michigan. There was "a serious risk" that Schmidt would not appear before the court if released, he added.

Among other things, Schmidt is accused of lying to US officials. He allegedly claimed that technical problems were to blame for discrepancy between diesel emissions in road and laboratory tests. The company later admitted to using a software tool to manipulate the results.

Schmidt is one of several VW executives who face charges in the US. He worked as the carmaker's emissions compliance manager. He ran a VW office in Detroit between 2012 and 2015 and later returned to Germany. He was arrested at Miami airport in January 2017 after vacationing in Florida and Cuba. He pleaded not guilty before the Detroit court.

Sentence milder in Germany

On Thursday, Schmidt's attorney David DuMouchel pointed out that Schmidt had openly talked about traveling to the US, even though he knew that he might be arrested.

"This is hardly the action of someone who was trying to avoid the jurisdiction" of US courts, DuMouchel said. "All he had to do was stay home."

However, the prosecutors argued that Schmidt should not be released because he had reasons to flee to his native Germany.

Schmidt could "take his chances in Germany, where the sentence he faces would be significantly less," assistant US attorney, John Neal, told the court. Germany does not extradite its citizens.

Billions down the hole

By siding with the prosecution, Judge Cox also disregarded pleas from Schmidt's family and friends, who offered a combined $1.6 million (1.5 million euros) to pay his bail. The executive's family was present at the hearing and some of them burst into tears after his application to be released was rejected, according to the "Detroit News" daily.

The German car-making giant Volkswagen has been struggling with the costly fallout of the 2015 scandal, which affected some 11 million cars worldwide. The company officially pleaded guilty in the US last week, agreeing to pay $4.3 billion in criminal and civil fines. This sum comes atop $17.5 billion that VW had agreed to pay to car owners, dealers and environmental watchdogs.

dj/jm (Reuters, AFP, AP, dpa)