Aviation News

July 1, 2011

Singapore Airlines to Pay U.S. Government $48 Million Fine for Cargo Price Fixing

Singapore Airlines Cargo on Thursday pleaded guilty and agreed to pay a $48 million criminal fine for its role in a conspiracy to fix prices in the air transportation industry, the U.S. Justice Department said.

Singpore Airlines Cargo 747-400F taking off at LAX

A Singpore Airlines Cargo 747-400F (9V-SFP) takes off at LAX. (Photo by Brian Futterman)

According to court documents, Singapore-based Singapore Airlines Cargo engaged in a conspiracy to fix the cargo rates charged to certain customers in the United States and elsewhere for international air shipments from as early as February 2002, until at least February 14, 2006.

In addition, the airline company and co-conspirators agreed during meetings, conversations, and other communications on one or more components of the cargo rates to be charged for shipments on certain routes to and from the U.S. As part of the conspiracy, the involved parties levied cargo rates in accordance with the agreements reached, and monitored and enforced adherence to the agreed-upon cargo rates.

Singapore Airlines Cargo is charged with price fixing in violation of the Sherman Act, which carries a maximum fine for corporations of $100 million. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

In addition to the $48 million criminal fine, which is subject to court approval, Singapore Airlines Cargo also agreed to cooperate with the department’s ongoing antitrust investigation in which a total of 20 airlines and 17 executives have been charged for price fixing in the air transportation industry.

To date, more than $1.7 billion in criminal fines have been obtained and four executives have been sentenced to serve prison time. Charges are pending against the remaining 13 executives.