By anyone’s scale of measurement the £121.5m fine imposed on British Airways for price fixing is a colossal amount of money.
The attempted collusion with traditionally bitter rivals Virgin Atlantic over fuel surcharges is without doubt a serious crime.
The world’s favourite airline also faces a further fine from the US Department of Justice over the scandal and some are predicting that BA will eventually have to cough up more than £300m.
Virgin Atlantic may have escaped punishment for effectively shopping BA, but the airline hardly comes out of the whole sordid mess with any credit. Sir Richard Branson’s company would undoubtedly have faced similar levels of fines if it had not secured immunity after reporting the attempted deal to the Office of Fair Trading.
The fine slapped on BA is wholly justified, something that the airline’s chief executive Willie Walsh (appointed after the scandal broke) has acknowledged in some fairly straight-talking interviews.
If the deal had worked and been kept a secret, airline passengers would have been hit hard in the pocket.
However, the fine does start to look excessive when compared to other high-profile cases involving corporate wrong-doing. Equally, the stuttering attempts by the Government to introduce a strong, workable and realistic offence of corporate manslaughter suggests that swindling people out of money is still regarded as far more serious than taking their life.
As with every other offence, the punishment should fit the crime.
For example, the £4m fine imposed on Network Rail last March over the 1991 Paddington rail disaster that left 31 dead was roundly condemned by many as failing to reflect the seriousness of the health and safety breaches that occured or the consequences.
Even if the bill eventually gets all the way through Parliament, there are many who believe it will still lack sufficient teeth to properly punish those guilty of corporate manslaughter.
Although not necessarily a life or death issue, the failure of regulators to crack down harder on companies who fail to maintain even the most basic security measures on sensitive personal information of customers, clients and staff is totally unacceptable. Some of our biggest financial institutions are amongst the worst culprits, yet continually get nothing more than a stern warning or wrap over the knuckles – the same financial institutions, let it not be forgotten, who come down very quickly and comparatively hard on customers over fairly minor indiscretions.
The Nationwide Building Society was fined £980,000 by the City financial watchdog after a laptop containing sensitive data was stolen from an employee. Yet similar breaches continue to happen and generally the punishment is miniscule.
Fraud is costing the UK £20bn – or each of us £330 a year – according to a study by police, yet so much of it is simply written off and companies responsible for failing to promote proper security are not being held accountable.
The fine imposed on BA is justified and should act as a sufficiently dire warning to others looking to enter such illegal agreements.
But surely there should be more consistency in the punishment meted out to companies, particularly if the offences involve a loss of life rather than simply a loss of money?