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Northwest to pay $38 million cargo price-fixing fine

By Annalyn Censky, staff reporter


NEW YORK (CNNMoney.com) -- Northwest Airlines will plead guilty and pay a $38 million fine for conspiring to fix cargo rates, the Justice Department announced Friday.

In a felony charge filed Friday, the Justice Department said Northwest Airlines Cargo earned more than $80 million from air cargo services between the United States and Japan after the company conspired to fix those rates in violation of federal antitrust laws. The alleged price-fixing occurred between July 2004 and February 2006, prior to Northwest's merger with Delta Air Lines (DAL, Fortune 500).

Northwest agreed to pay the fine and cooperate with an ongoing investigation into an industry-wide conspiracy to fix rates.

The company has also fired the person "it believed had primary responsibility for the conduct in question," Delta said in a statement following the plea agreement.

"The agreement doesn't assert any misconduct by any current or former officer or member" of the company's board of directors, Delta's statement said.

Another 15 carriers - including British Airways, Korean Air Lines, Qantas Airways and Cathay Pacific Airways -- have already either pleaded guilty or agreed to plead guilty in the Justice Department's investigation, paying out $1.6 billion in criminal fines, the department said.

Four executives from Qantas, British Airways and SAS Cargo Group have also been sentenced to serve prison time, and charges are pending against a fifth executive, the department said. To top of page

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