Cartel Conduct - A Recent Australian Case

What is cartel conduct?

Cartel conduct occurs when businesses make contracts or arrangements or arrive at understandings with their competitors to fix prices, rig bids, share markets or restrict outputs.

 

What is price fixing?

Price fixing occurs when competitors agree on a pricing structure rather than competing against each other, to the detriment of consumers and other businesses.

 

Cartel conduct charges for Vietnamese money remitters – a recent case study

The Australian Federal Police (AFP) provides the details of a recent cartel case on its website.

 

Case Overview

On Thursday, 11 April, five people appeared before court after being charged with offences relating to price fixing cartel conduct.

The five accused faced charges under the criminal cartel provisions of the Competition and Consumer Act 2010 (Cth). Three men from Sydney and two Melbourne residents appeared before Melbourne Magistrates’ Court.

 

Investigation

The charges follow a joint investigation into alleged price fixing of the Australian Dollar/Vietnamese Dong exchange rate and transaction fees by a number of money transfer remitters in Sydney and Melbourne.

The Australian Federal Police (AFP) and the Australian Competition and Consumer Commission (ACCC) commenced Operation EUPORIE in 2014, to investigate allegations of cartel conduct by money remittance companies including Vina Money Transfer Pty Ltd, trading as ‘Vina Money Transfer’.

It is alleged this company, which runs branches in New South Wales and Victoria, fixed the Australian Dollar/Vietnamese Dong exchange rate and the transaction fees that it charged customers, in contravention of the Competition and Consumer Act 2010 (Cth).

 

Charges

Vina Money Transfer was charged with making contracts, arrangements or understandings (CAUs) which to the knowledge of the corporation, contained cartel provisions, in relation to the fixing of exchange rates and transaction fees. The company was also charged with giving effect to these CAUs.

The specific charges are “being knowingly concerned in the making of and giving effect to a CAU that contained a cartel provision relating to exchange rates” and “being knowingly concerned in the making of and giving effect to a CAU that contained a cartel provision relating to transaction fees”.

 

Multi-agency cooperation

This case is a prime example of the increasing cooperation between multiple law enforcement agencies in tackling serious and organised crime.

This investigation saw the AFP and ACCC conduct a joint investigation over a number of years, one of the first such investigations conducted by the two agencies.

Australian Federal Police Detective Sergeant Jarrod Ragg said that “the alleged criminal conduct occurred over an extensive period of time and involves allegations of significant anti-competition cartel conduct. This has been a long term joint investigation that has successfully resolved through the laying of complex charges that will be heard in the Federal Court.”

Nyman Gibson Miralis are experts in defending individuals and companies who are being investigated for corporate and financial crime. 

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