Frankfurt, July 31 -- German prosecutors have charged the former head of Audi, Volkswagen's luxury division, with fraud in connection with the sale of cars with software that enabled cheating on emissions tests, adding another chapter to VW's diesel scandal that has seen its former CEO charged in the U.S. and two executives go to prison there.

Prosecutors in Munich said Wednesday in a news release that they had charged Rupert Stadler and three other individuals. The three unnamed individuals were charged with having developed engines used in Audi, Volkswagen and Porsche models that had software that made the emissions controls work better on the test stand than in real-life driving.

Stadler was charged with having known about the manipu...