Billionaire Dick Pratt faces jail
http://www.news.com.au/heraldsun/story/0,21985,23892386-661,00.htmlNorrie Ross
June 20, 2008 12:00am
EXCLUSIVE: BILLIONAIRE Dick Pratt faces up to four years' jail after being charged yesterday with lying about his knowledge of a price-fixing scandal.
The laying of criminal charges could force Mr Pratt to step down as president of Carlton Football Club.
The Australian Competition and Consumer Commission alleges the chief of cardboard manufacturer Visy gave false and misleading evidence before a commission hearing in 2005.
In a summons lodged in the Federal Court yesterday, the ACCC charges Mr Pratt with breaching the Trade Practices Act by denying knowledge of a plot to fix the price of cardboard boxes with Visy's rival, Amcor.
In evidence before the commission, Mr Pratt was asked by Peter Jopling, QC, if he had a conversation in the All Nations Hotel in Richmond on May 21, 2001, with Amcor's former chief executive officer, Russell Jones.
Mr Jopling said Mr Jones had told the commission they discussed the price-fixing arrangement and how it protected market share.
Mr Pratt replied: "He's lying."
Mr Jopling: "Why are you so adamant he is lying?"
Mr Pratt: "Because I would have recalled such a conversation and there never was one."
In another part of the cross-examination, Mr Jopling asked: "Do you have any independent knowledge of the existence of such an arrangement?"
Mr Pratt: "No."
Mr Pratt is facing four separate charges under Section 5 of the Act.
The penalty for each charge ranges from a fine of $2200 to 12 months' jail.
The charges will bring pressure on the AFL and its chief executive, Andrew Demetriou, over Mr Pratt's role as Carlton president.
Critics said the AFL should have ended Mr Pratt's tenure when Visy was fined $36 million in the Federal Court last year after admitting price-fixing with Amcor.
In April this year, Mr Demetriou said he had been guided by the Federal Court decision not to bar Mr Pratt from being a company director.
Under pressure over the scandal, the cardboard king challenged the AFL to set the record straight "once and for all".
"If they don't have a problem, let them be unequivocal about it, then put the matter to rest," he said.
Justice Peter Heerey found Visy and Amcor had carved up the $1.8 billion cardboard box market for almost five years.
The judge said the cartel would probably still be flourishing if it had not been accidentally exposed.
Mr Pratt had profited at the expense of every man, woman and child in Australia, the judge said.
The court heard executives of both companies organised secret meetings using phone boxes and pre-paid mobile phones before their activities were discovered.
Visy admitted colluding with Amcor, so each could retain its share of the market, and collaborating to increase their prices.
The companies agreed to price rises totalling nearly 20 per cent over four years.
They also agreed to submit deliberately high quotes when asked by their rival's customers to tender for a contract.
Visy's actions cost companies such as Coca-Cola, Cadbury, Gillette and Nestle millions of dollars.
Visy is facing the prospect of a $700 million class action from customers who paid too much for cardboard boxes.
