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-- Most recent corporate price-fixing schemes uncovered
Most recent corporate price-fixing schemes uncovered
I remember someone earlier here on the forum questioned if the oil companies are fixing prices on gas stations, I think it was Kryption. Hail to Firestarter and others, those who think that corporations are even more trusted than the government can ever be. We can ignore the fact that corporate crime costs billions of dollars annually to us. Well, look no further, here's a recent proven example:
British Airways, Korean Air each hit with $300M antitrust fine
http://www.thestar.com/Business/article/249152
quote:
Aug 23, 2007 03:21 PM
Matt Apuzzo
Associated Press
WASHINGTON � Two major airlines were fined $300 million (all figures U.S.) apiece Thursday after admitting they conspired to fix prices on international flights and agreeing to help prosecutors investigate other airlines.
British Airways PLC, Britain's largest airline, and Korean Air Co., South Korea's national carrier, pleaded guilty to antitrust conspiracy charges. They acknowledged colluding with rivals over cargo rates and fuel surcharges, which were added to fares in response to rising oil prices. That meant higher costs for international shippers and passengers.
U.S. District Judge John Bates said the case "involved considerable commerce and reflected long-term and widespread conduct involving major airlines and players."
Both saw their potential fines reduced because they co-operated with U.S. Justice Department investigators. Korean Air's fines could have been twice as high and British Airways could have faced fines closer to $900 million, but the Justice Department and the judge credited the company with co-operating.
"Any anticompetitive behaviour is to be condemned at British Airways or at other companies. It will not be tolerated and we remain vigilant in this respect," British Airways chief executive Willie Walsh said in a statement released after court.
Korean Air released a statement saying it was "committed to antitrust compliance" and was taking steps to make sure the conduct was never repeated. Neither company addressed the extent of its co-operation or how widespread the practice was in the industry.
Earlier this month, authorities in London announced $246 million in fines for British Airways in a parallel transatlantic investigation. Both inquiries are ongoing.
Scott Hammond, deputy assistant attorney general for criminal antitrust issues, said the sentences proved that "those who violate the antitrust laws and seek to deny American consumers and businesses the benefits of competition will be held accountable."
Other companies were not named, but Virgin Atlantic has been identified in London but is not expected to face a fine there because it reported its misconduct to authorities.
As part of their plea deals, the airlines acknowledged they colluded with other unidentified companies from 2000 to 2006. The cargo rate scheme meant higher shipping costs for businesses. For passengers, the scheme meant more expensive tickets because the surcharges were wrapped into the ticket fare.
Between 2004 and 2006, fuel surcharges rose from about $10 to about $120 per ticket for a round-trip, long-haul flight on BA or Virgin.
Bates credited both British Airways and Korean Air with turning over hundreds of thousands of documents, some of which needed to be translated, and making executives available for interviews with investigators. As foreign companies, they could have challenged the probe and refused to cooperate.
The $300 million criminal fines were the second-largest antitrust sanction by the Justice Department since 1995. The largest antitrust fine, $500 million, was against vitamin giant F. Hoffman-La Roche in 1999 in a price-fixing case.
I never said corporations were more trustworthy?
In fact, I even mentioned Enron, laws and private watchdog groups...
I can't believe I'm quoting myself but evidently people have selected memories...
| quote: |
Are there large 'evil' corporations out there? Probably. (Enron any one?). But that's what Watch Dogs and laws are for...  |
| quote: |
| Originally posted by Fir3start3r I never said corporations were more trustworthy? In fact, I even mentioned Enron, laws and private watchdog groups... I can't believe I'm quoting myself but evidently people have selected memories... >Here< |
I've got an idea.
We should create a watch dog group that will ensure that the coperations complie with all of the laws, but here's the innovation, we will make sure that each locality has it's own representative on the watch dog orginzation.
And just to make sure there is minimal corruption and that the representative is actually keeping the interests of the comunity they represent in mind this organization should insist that everyone in the region gets a chance to have a say about who is representing them on the watch dog group.
Then, just because people change, as do the demographics of any region over time, this watch dog group should force the representatives to re-apply for the position every so often, say ever four or five years.
Actually, now I'm really inspired, I'm going to make this thing happen.
I think I'll call it democratic government.
Many corporations break the law because they dont mind paying out some money if caught ... its a gamble. The dont get caught - they win lots of money, or they get caught, but by the time they do they either make anough or more money than the fine or the fine doesnt create any problems at all. I am sure that in this case, the fines were not sufficient enough to put a dent into these huge companies. It might deter them for a while, but it surely has taught them one lesson - to avoid repeating the same mistake when attempting a crime again.
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