Former Peruvian Airline Exec Pleads Guilty to Fixing Air Cargo Prices
The Justice Department has announced that George Gonzalez, a former chief commercial officer of Cielos Airlines, a Peruvian air cargo carrier, pleaded guilty for his role in a conspiracy to fix surcharges on air cargo shipments from the U.S. to South and Central America.
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Exec and Three Others Were Charged with Conspiracy in 2010
In October 2010, Gonzalez and three other former airline executives were charged in Miami with conspiring to suppress and eliminate competition by agreeing to impose an increase to their fuel surcharges on air cargo shipped from the U.S. to locations in South and Central America. The indictment charged the executives with participating in the conspiracy beginning in or around late September 2005 until at least November 2005.
Two Pleaded Guilty and Are Awaiting Sentencing
In September 2011, two of the other indicted former airline executives pleaded guilty to the charge. Guillermo Cabeza, former president of Arrow Air, a Miami-based air cargo carrier, and Luis Juan Soto, former president of South Winds Cargo, also a Miami-based air cargo carrier, pleaded guilty to the charge and are awaiting sentencing. (See ITT's Online Archives 10102916 for summary.)
In connection with their pleas, Gonzalez, Cabezan, and Soto have each agreed to cooperate with DOJ in its investigation and to pay a criminal fine.
Total of 22 Airlines, 21 Execs Charged in DOJ's Ongoing Investigation
A total of 22 airlines and 21 executives, including Gonzalez, Cabeza and Soto, have been charged in DOJ's ongoing investigation into price fixing in the air transportation industry. To date, more than $1.8 billion in criminal fines have been imposed and four executives have been sentenced to serve prison time.
(See ITT's Online Archives 11053104 and 10120132 for summaries of DOJ's most recent charges in its investigation of EVA Airways and Singapore Airlines Cargo, which agreed to pay $13.2 million and $48 million criminal fines, respectively.)