Two Fowarding Executives Sentenced for Price-Fixing

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Published Jun 26, 2019 5:04 PM by The Maritime Executive

Two freight forwarding executives have been sentenced to more than a years' imprisonment each for their involvement in a price-fixing scheme that raised costs for shippers. Roberto Dip and Jason Handal were charged with fixing prices in June 2018, and they pleaded guilty to violations of the Sherman Antitrust Act in November 2018. 

Dip, the president and CEO of Louisiana-based freight forwarding company Dip Shipping, and Handal, the company’s manager, admitted that they organized meetings within the U.S. and abroad to reach agreements with competitors to fix prices. These unlawful agreements covered forwarding services provided in the United States and abroad from September 2010 until March 2015, and possibly longer. The activity affected receipts totaling to about $6.5 million over the period in question.

“These defendants’ conduct raised freight-forwarding prices by as much 20 percent, victimizing vulnerable consumers and individuals sending gifts and household goods to family members and loved ones for holidays,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division. “Today’s sentences reflect the significant harm that the defendants caused, and should send a message to other would-be price-fixers that this crime will not go unpunished.”

Dip was sentenced to 18 months’ imprisonment, with credit for time served, and Handal was sentenced to 15 months. Each executive will also pay a $20,000 criminal fine and submit to three years of supervised releases.

According to prosecutors, Dip met in Honduras in 2014 with "numerous competitor freight forwarding companies" in order to reach an agreement to raise prices on customers. Regional criminal "commissions" of five or six freight forwarders each in various U.S. cities would implement the price-fixing agreement. Dip put the contents of this unlawful agreement into an email summary and sent it to "numerous" competitors after the meeting, prosecutors alleged. In a later email, he acknowledged that the activity was illegal: the "FMC [Federal Maritime Commission] cannot have a hand in something like this because it is illegal for businesses to set the price for price fixing," he wrote, according to charging documents.  

Dip's role in the conspiracy allegedly involved contact with at least five other participants in multiple U.S. states, but the co-conspirators were not named. In charging documents, the FBI's New Orleans office said that it is working with the Antitrust Division of the Department of Justice in an ongong investigation into anti-competitive practices in the ocean freight market between the U.S, Honduras and other locations.