Cargolux Execs Get 13 Months for Air Cargo Price-Fixing

The former CEO of Cargolux, Ulrich Ogiermann, and his top deputy accepted sentences of 13 months in prison and fines $20,000 each under plea agreements for their role in a international conspiracy to fix air freight rates.

The plea bargains at a court in Miami set the largest sentences handed down for any of the officials charged in investigations into a global conspiracy among some of the world’s largest airlines to fix rates and surcharges across the industry.

Ogiermann, former head of Europe’s largest cargo airline, and Robert Van de Weg, senior vice president of sales and marketing, pleaded guilty to conspiring with competing carriers to suppress and eliminate competition by fixing security and fuel surcharges.

Oigermann, currently an advisor to Cargolux, participated in the conspiracy from as early as October 2001 until at least February 2006, and Van de Weg was involved from as early as December 2003 until February 2006, the Department of Justice said.

Under their plea agreements, the Cargolux executives are cooperating with the Justice Department’s investigation.

Oigermann stood down as Cargolux president and CEO in November 2010 after being indicted. Van de Weg has remained in his position.

Twenty-two airlines, including British Airways, Korean Airlines and Air France-KLM, and 21 executives, including Oigermann and Van de Weg, have been charged in the U.S. To date, more than $1.8 billion in criminal fines have been imposed and four executives have been given jail terms.

Cargolux is paying $119 million over five years under a plea agreement with the U.S. Justice Department in April 2009. It also is appealing a $105 million fine by the European Union, the third largest penalty in a $1.1 billion fine on eleven airlines for price fixing.

“While expressing its regret for the executives personally, Cargolux acknowledges their decision to plead guilty as a way to bring this matter to a controlled close both for them and the company,” Cargolux said in a statement Friday.