Two Japanese air freight forwarding companies agreed Friday to plead guilty and pay $18.9 million in criminal fines in a conspiracy to fix air freight forwarding fees for cargo shipments from Japan to the United States.
“K” Line Logistics Ltd. agreed to pay $3.5 million in criminals fines and Yusen Logistics Co. Ltd. agreed to pay $15.4 million. The pleas bring to 16 the number of companies that have either pleaded guilty or agreed to plead guilty in an ongoing investigation in the air freight business, paying criminal fines totaling more than $120 million.
“Consumers were forced to pay higher prices on the goods they buy every day as a result of the noncompetitive and collusive service fees charged by these companies,” said Assistant Attorney General Bill Baer, who heads the Justice Department's Antitrust Division. “Prosecuting these kinds of global, price-fixing conspiracies continues to be a top priority of the antitrust division.”
Freight forwarders manage the domestic and international delivery of cargo for customers by receiving, packaging, preparing and warehousing cargo freight, arranging for cargo shipment through transportation providers such as air carriers, preparing shipment documentation and providing related ancillary services.
According to charges filed separately Friday in the U.S. District Court for the District of Columbia, “K” Line Logistics and Yusen Logistics engaged in a conspiracy to fix and to impose certain freight forwarding service fees, including fuel surcharges and various security fees, charged to customers for services provided in connection with air freight forwarding shipments of cargo shipped by air from Japan to the U.S. from September 2002 to November 2007.
Federal prosecutors said the companies carried out the conspiracy by, among other things, agreeing during meetings and discussions to coordinate and impose certain freight forwarding service fees and charges on customers purchasing freight forwarding services for cargo shipped by air from Japan to the United States. They said the companies levied freight forwarding service fees in accordance with the agreements reached and engaged in meetings and discussions for the purpose of monitoring and enforcing adherence to the agreed-upon freight forwarding service fees.
Each company is charged with price fixing in violation of the Sherman Act, which carries a maximum $100 million fine for corporations. 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.
The charges were brought as a result of a joint investigation by the Antitrust Division’s National Criminal Enforcement Section, the FBI’s Washington field office and the Commerce Department’s Office of Inspector General.