Qantas Fined $61m (Merged)

[Ang737]

Just heard on the early morning news that QF have been fined $61m for price fixing on their cargo prices between US and OZ... Ooops :eek:

[Jabawocky]

Ouch!:ouch:

Is that here in Oz, because I bet they will get pinged both here and the US which could mean a bit more loose change is about to be confiscated.

Of course that will come out of executive bonuses not the T&C's of the workers, so do not fear!

J:E

[Annulus Filler]

If I remember correctly, Qantas had this money set aside to cover this expense 12 months ago.

[Ang737]

Yeah they did. In Sept this year they annouced that had put aside $41m in anticipation. A 20 million short fall is a significant amount and would have to hurt.

[Keg]

QANTAS has agreed to plead guilty and pay a $US61 million ($69.4 million) fine in a US court after being charged with price-fixing international air cargo rates for more than six years from January 2000.

The US Department of Justice filed charges against Qantas Airways Limited in the US District Court in the District of Columbia in Washington DC today.

The department accuses Qantas of engaging in a "conspiracy to eliminate competition by fixing the rates for shipments of cargo to and from the United States and elsewhere from at least January 2000 to February 2006".

During that time Qantas was the largest carrier of cargo between the US and Australia and made more than $US600 million ($683.7 million) from its cargo flights along the route.

Representatives from the airline were not immediately available to comment.

Under the plea agreement, which still needs to be approved by the court, Qantas has agreed to cooperate with the ongoing US investigation.

"Qantas's guilty plea sends a clear message that those who engage in price fixing and other forms of illegal collusion will pay a heavy price for their crimes," assistant Attorney-General Thomas O Barnett said.

Mr Barnett, who is in charge of the US Department of Justice's antitrust division, said: "The shipment of consumer products by air transportation is critical to our global economy.

"Our investigation into this important industry will continue, and we will aggressively pursue those who engage in criminal conduct that harms American consumers," he said.

Qantas was charged with carrying out the price-fixing conspiracy by participating in meetings and talks in the US and elsewhere to discuss the cargo rates to be charged on trans-Pacific routes to and from the US.

It also engaged in meetings and talks to enforce the agreed rates.

The US Justice Department said in August, British Airways and Korean Air Lines pleaded guilty and were sentenced to pay separate $300 million criminal fines for their role in price-fixing on cargo prices.

www.news.com.au

[Capt Wally]

..............hmmmmmm have Pratts & QF merged?:}

[gaunty]

OK lets see here, whether I steal a gazzilion dollars at gunpoint or not I can expect to go to gaol, hard time.

So who in Qantas is going to step forward and take it like a man for the team???:mad:

Just like our paper/board manufacturer friends. At least Qantas didn't try that sleazy PR/Australian magazine/philanthropist routine, what a prat. :{

[Sunfish]

Why am I not surprised that Qantas would engage in illegal behavior?
I hope that one of the things Mr. Rudd does during his first 100 days in office is to provide for a criminal (rather than civil) convictions for price fixing and similar anti competitive behaviour and attach mandatory long jail terms.

[QFinsider]

Corporate Governance and repsonsibility should see the board resign en mass...

Sadly both are lacking at Q and it will be business as usual.

[Torres]

One assumes the three or four hundred million dollar windfall goes into the US consolidated revenue and not one cent is returned to the victims of the alleged cartel?

[qantasjetstar]

Qantas were fined $60 million for price fixing. A lot more than the $47 million they had set aside. ( Channel 7)
At the recent Qantas A.G.M the directors made light of the charge, but it just shows that Qantas act illegally when it suits them. Surely the directors and not the shareholders should be held responsible.
Imagine how many bottles of plonk they could have given the passengers.
Has Mrs Dixon's little boy Geoff been caught with his fingers in the cookie jar. If not then why won't he speak up.

[Phileas Fogg]

Do BA not hold a shareholding in Qantas, price fixing is old hat to BA!

[Ralph the Bong]

Yes Torres, perhaps the victims of this scam could take civil action.

[BD1959]

No Phileas, not since 2005.

It will be interesting to see what spin Margaret Jackson puts on this little blot of her tenure.

BD

[rmm]

Yes Torres, perhaps the victims of this scam could take civil action.

Looks like it's already underway,

http://www.abc.net.au/news/stories/2007/11/28/2103509.htm

[Lowkoon]

If I set u a business to conduct illegal activities, wouldnt i be held responsible? Why are these people never held responsible or made accountable?

[Earl]

http://edition.cnn.com/2007/BUSINESS/11/27/qantas.ap/index.html
Qantas admits price-fixing in U.S.
WASHINGTON (AP) -- Qantas Airways Ltd. on Tuesday became the third international airline this year to admit to price-fixing and agree to pay a multimillion-dollar fine to the U.S. government.
art.qantas.getty.jpg

Qantas acknowledged imposing fuel surcharges in the airline's freight division.

The Australian carrier's CEO said U.S. and foreign antitrust regulators are investigating up to 30 airlines for similar conduct.

Qantas sought to eliminate competition by fixing the rates for shipments of cargo to and from the U.S and elsewhere from at least January 2000 through February 2006, according to the charges filed in the U.S. District Court for the District of Columbia.

During the time covered by the felony charge, Qantas was the largest carrier of cargo between the U.S. and Australia, earning more than $600 million from its cargo flights between the two nations, according to the Justice Department.

Under the plea agreement, which is subject to court approval, Qantas has agreed to cooperate with the Justice Department's ongoing investigation and pay a $61 million fine.

Qantas Chief Executive Geoff Dixon apologized for the illegal conduct, which he said involved fuel surcharges in the airline's freight division. The company's financial statements include a $40 million provision for the U.S. case, and "we do not believe this or any further financial penalties will materially affect future operating results," he said.

Qantas has cooperated fully with antitrust investigations in the U.S. and elsewhere since May 2006 and expects them to take up to two years to complete. "We understand more than 30 other airlines are included," Dixon said in a release.

Earlier this year, British Airways PLC and Korean Air Lines Co. Ltd. each pleaded guilty and agreed to pay separate $300 million criminal fines for their roles in conspiracies to fix the prices of passenger and cargo flights.

Qantas was charged with carrying out the price-fixing by participating in meetings to discuss the cargo rates to be charged on certain trans-Pacific routes to and from the U.S., and then levying rates according to the agreements reached.

Four former and two current Qantas employees have been excluded from the plea agreement and the Justice Department has reserved the right to investigate further. The two current Qantas employees "deny involvement in any illegal conduct," Dixon said.

"It was so unnecessary, they didn't really have to collude," said airline consultant Michael Boyd, adding that cargo rate increases and fuel surcharges were justified based on rising oil prices in recent years.

Fuel costs accounted for the largest piece of U.S. airlines' operating expenses in the second quarter of 2007 at 25.4 percent, and are expected to represent more than 26 percent of airlines' expenses globally in 2007, according to domestic and international trade groups.

It's unclear if any U.S. carriers eventually will be incriminated in the Justice Department probe. If a domestic airline simply saw its foreign competitors raise rates and did the same "that's not illegal," Boyd said. "But picking up the phone and talking about it is."

[RevMan2]

Lufthansa Cargo was one of the first to be investigated and cooperated with the authorities for a reduced fine of $85m

The CEO took immediate early retirement "for health reasons"....

[qantasjetstar]

I think that more than the CEO should resign. This type of operation is not what Qantas stands for.
Are they working for themselves or the shareholders?
Dixon has just been awarded 1 million shares, for what? Breaking the law again.

[Reeltime]

So the shareholders have to fork out for this fine? What about the individuals responsible?

I sincerely hope this is just the beginning of this, someone has got to start digging into the goings on with the management of this once proud company.

It's interesting to note that the price fixing has been going on for the last six or so years.

ACCC and ASIC get your acts together and start doing what you're supposed to be doing....having a damned good look into the board and management of Qantas!

[Earl]

qantasjetstar

Are they working for themselves or the shareholders?
Dixon has just been awarded 1 million shares, for what? Breaking the law again.


Not sure but if the math is correct they made 600 million, was only fined 60 million.
That leaves 540 million profit.
Maybe some one else can explain this one.
Not implying that this is right, but they sure made a lot of money breaking the rules, guess there is no justice for these types.

[Re-Heat]

Jackson lost her job as a result of the Macquarie buyout collapse; the smaller fine than BA is due to involvement in the cargo operation only, with the max US fine being 10% of worldwide revenue (relating to that cargo operation).

The profit is not considered by the DoJ in determining the fine, and considering that the BA "cartel" involved no more than a handful of people, it is hardly likely or realistic that it was orchestrated by, or known to Dixon at any point in time.

Why would the shareholders want to get rid of the man who has driven the stock price up from $2.96 to $5.81 in 18 months?

[qantasjetstar]

Why would the shareholders want to get rid of the man who has driven the stock price up from $2.96 to $5.81 in 18 months?
Yes they would if $600 million is got illegally. If it is running illegal brothels or price fixing it is not the investment responsible Australians want to be involved with. If $600 million profit can be made without the directors admitting, how many other wroughts are slipping past?
It is reported that Qantas CEO Geoff Dixon will not deny that Qantas have been, or are involved in 'Passenger air fare price fixing"
Will we have to wait until they suddenly put aside funds for a fine?
If management can't detect the illegal actions of their staff then GET RID OF THEM. At least Margaret Jackson went without a fight.
There can be no EXCUSES.
QANTAS ACT ILLEGALLY...
THEY ARE THE AUSTRALIAN FLAG CARRIER...
THEY ARE TARNISHING THE AUSTRALIAN FLAG
AND YOU AS AN AUSTRALIAN..
Perhaps Kevin will pull them into line as the junket trip with Howard and his mates is over. I wonder if Dixon will have tears in his eyes the same as Howard, Costello, and Vale when they got the push.
If we as lower mortal don't show our discust with illegal company operations, we might as well hand over to the mafia. Perhaps they have.

[Re-Heat]

Twaddle: they are a private-sector company, and those involved are no longer employed. Besides, as pointed out about, the $600m profit is attributable to more than the cargo operation alone.

You sound like an anti-business tub-thumper.

[qantasjetstar]

I know Qantas are a private company. I own shares in them, so I want the directors to take the blame. If it is not their job to know what is going on, then tell me what they are getting paid for. Not, I'm sorry Miss and I wont do it again. Can I go and play now?

Consider this...
A 747 with Captain, F/o and S/o.
While the captain is taking a break the S/O by mistake dumps some fuel. The captain is called back to the flight deck and decides to divert. WHO carries the can? The CAPTAIN

Geoff Dixon is the CEO He is responsible to shareholders (me)
Padding
Padding
Cargo Crooks

Qantas is charged with price fixing. WHO SHOULD CARRY THE CAN
Yes those at the bottom were sacked but that DOES NOT CLEAR QANTAS. THEY BROKE THE LAW

As a shareholder I would like the company to act in a responsible and honest way, providing the best service to the public and not ripping them off as long as they could.

[OhSpareMe]

Actually QANTAS is a 'Public' Company. They attempted to go Private, but it didn't get up.

And as for.........

Consider this...
A 747 with Captain, F/o and S/o.
While the captain is taking a break the S/O by mistake dumps some fuel. The captain is called back to the flight deck and decides to divert. WHO carries the can? The CAPTAIN

Can't you come up with a more credible analogy?

[Sunfish]

Now here is a thought............a jetstar passenger throws a punch at an employee after being denied boarding.

.........Qantas is fined $60 million for price fixing.

Which is the greater crime?

WHy isn't the entire Qantas Board and Senior management facing criminal charges?

Please explain?

[mmciau]

Yes, it will be interesting to see when Attorney-General McClelland agrees to see Mr Graham Samuels from the ACCC!!!!


Mike

[AEROMEDIC]

Dixon should be made to pay the fines out of his bonuses. :mad: :*

[Philthy]

INTEGRITY
Integrity is the greatest asset a Company or an individual can posess. In all our dealings, inside and outside the Company, integrity should be taken first and the spirit of an agreement taken before the letter....Always keep out of Court whenever this is possible with honour and fair dealing. Companies or people having frequent Court actions are usually not of the best repute, and it is bad publicity anyhow.

from Ethics and Other Things: A Souvenir of Qantas Service, by Qantas Chairman Hudson Fysh, May 1955

There is no doubt that a company's attitudes to business are set by those at the very top. Old Huddy would be turning in his grave. It should be noted, though, that Fysh was also a great supporter of IATA, which in his day was a giant cartel.