US – JAPAN – WORLDWIDE – The continuing fines arising from the various freight forwarding cartels around the globe over the past decade now appear to be a major source of income for some governments. In the latest round the US authorities have imposed penalties on a group of Japanese logistics companies which have all pleaded guilty to anti trust activities concerning cargo movements which occurred from at least 2002 until late 2007.
Six international freight forwarding groups took the option of pleading guilty last year (details HERE) and in the past month seven Japanese companies have also admitted conspiracy to operate a cartel for air freight consignments imported into the US from Asia. The first tranche of fines netted the US over $50 million and the latest round a further $48 million plus.
During the latest rulings initially the Nissin Corporation ($2.6 million) Vantec Corporation ($3.3 million) Hankyu Hanshin Express ($4.5 million) Nishi-Nippon Railroad ($4.6 million) Kintetsu World Express ($10.4 million) and Nippon Express (a whopping $21.1 million) were the first penalised but now MOL Logistics (Japan) has been ordered by the Department of Justice to fork out $1.84 million for its part in the scandal and, as part of the agreement, fully cooperate with the authorities in the ongoing investigation. This will probably entail handing over all information pertaining to the meetings, telephone conversations and e mails which outlined the details of the conspiracy to align air freight forwarding rates and surcharges.
What will strike many observers is that of the latest group found guilty of these activities only Kintetsu have had the perspicacity to issue a statement in plain sight on their website, both regretting their previous behaviour and assuring customers that they have instituted measures for the past two years to ensure no repetition of such collusion, whilst telling shareholders that the financial implications of the penalty imposed are covered by special provisions the company made against such a result.
The numerous Anti Trust prosecutions around the world have led to a spate of class action suits (example HERE) which are liable to create ongoing headaches for the air freight carriers for years to come. The investigation is a collaboration between the Department of Commerce’s Office of Inspector General, the FBI’s Washington Field Office, and the Department of Justice’s Antitrust Division’s National Criminal Enforcement Section.
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