| Three imprisoned for bid rigging |
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| Written by Adrie van der Luijt | |
| Thursday, 12 June 2008 | |
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Three UK businessmen have been jailed for up to three years for marine hose cartel offences.
All three were also disqualified from acting as company directors for periods of between five and seven years. These are the first ever convictions for a cartel offence since criminal prosecution powers were given to the Office of Fair Trading (OFT) under the Enterprise Act. Peter Whittle, David Brammar and Bryan Allison pleaded guilty at Southwark Crown Court to dishonestly participating in a cartel to allocate markets and customers, restrict supplies, fix prices and rig bids for the supply of marine hose and ancillary equipment in the UK. Marine hose The three are believed to have defrauded the Ministry of Defence and the US government for over £75 million over a 40-year period. Allison and Brammar were respectively the managing director and sales director of Dunlop Oil and Marine Limited, a manufacturer of marine hose based in Grimsby. Marine hose is used by the oil and defence industries for transporting oil between tankers and storage facilities. Whittle traded as an independent consultant but in practice was employed full-time by the parties to the cartel to co-ordinate their activities around the world. Officers of the OFT executed search warrants at Dunlop's offices and Whittle's home in May 2007 and seized extensive and compelling evidence of the cartel arrangements. At the same time, in an operation coordinated between the OFT and the US Department of Justice, the defendants were arrested in Houston, Texas, where a cartel meeting had taken place the previous day and was covertly recorded by the US authorities. A number of other suspects were also arrested by US authorities. Highly sophisticated and well-organised cartel Whittle, Brammar and Allison were allowed to return to the UK and face charges as part of a plea agreement with the US Department of Justice. Under the terms of the arrangement, the three would only face jail in the US if the UK court passed short sentences. They returned to the UK in December 2007 and were arrested at Heathrow Airport by the Metropolitan Police. The charges relate to the period between 20 June 2003, when the cartel offence came into force under the Enterprise Act, and 2 May 2007 when the men were arrested in the United States and the cartel arrangements brought to an end. The cartel was global in its scope and involved all the major manufacturers of marine hose worldwide. John Fingleton, OFT chief executive, said, 'This was a highly sophisticated and well-organised cartel, involving all the major manufacturers of marine hose worldwide over many years, where the cartel members secretly employed a full-time coordinator to allocate contracts and fix prices.” Financial incentives Whittle was sentenced to three years imprisonment and seven years director disqualification, whilst Brammar will spend two and a half years in prison and received a five years director disqualification. Allison was jailed for three years plus seven years director disqualification and £25,000 costs. Confiscation proceedings and costs for Brammar and Whittle will be heard on 1 July 2008. The OFT has a policy under which it will pay financial incentives of up to £100,000 in return for information which helps it to identify and take action against illegal cartels. The OFT also operates a leniency programme for companies and other individuals who decide to confess to cartel conduct. Related articles
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