Having been distracted by a few other topical items of late, I now return to something that caught my eye recently which surely made me smile, but also left a dark, bitter taste in my mouth. It is one thing for us to hear of Canadian companies conspiring to fix the price of petrol (gas), and it was another thing to hear of the allegations against Steve Jobs/Apple on a conspiracy with major publishing houses to drive up the price of e-books for us all, but are you kidding me......a price-fixing conspiracy for chocolate?!
Yes, you heard (read) right - chocolate! Hershey's Canada has already pled guilty to one count of price-fixing in Toronto's Superior Court of Justice and the company was fined a bittersweet $4M for their admitted role in the conspiracy initiated in 2007. But because Hershey's was the de facto whistleblower in this shady set of affairs, they get a similarly de facto slap on the wrist, and the Competition Bureau are really gunning for the others.
Who are the others? Well, no shocker that it is names you will all know and (used to) love - Mars Canada and Nestlé Canada, along with the lesser known ITWAL, a national collective of independent wholesale distributors of confectionery in Canada. As amusing as it all appears, price-fixing of any product sold to Canadian consumers is considered to be a criminal act, and the Competition Bureau doesn't seem to find it amusing at all.
"Price-fixing is a serious criminal offence and today's charges demonstrate the Competition Bureau's resolve to stop cartel activity in Canada", said John Pecman, who is the interim commissioner at the Bureau.
A chocolate cartel? What?! Isn't the term usually reserved for other illicit products, but then again, for some (many?!), chocolate is very much an addiction and a daily fix is simply part of everyday life. But still, I am not sure I can combine "chocolate" and "cartel" and not expect people to laugh at me! But rather unbelievably, criminal charges have been laid not only against ITWAL Ltd. but also against three high-ranking but conspiratorial players in the evil chocolate cartel:
- Robert Leonidas - former president of Nestlé Canada
- Sandra Martinez - former president (confectionery) of Nestlé Canada
- David Stevens - president/CEO of ITWAL Ltd.
Before we make too fun of this fact, it is worth remembering that under the Competition Act, price-fixing carries the possibility of a maximum fine of $25M and/or 14 years in prison. Decidedly unfunny, for those charged! However, things get a little more "light-hearted" given that the charges date back to 2007, which falls under the provision of a previous version of the act, thereby invoking a maximum fine of $10M and/or five years incarceration.
It all seems to be too ridiculous to be true, but trust me dear friends, chocolate is big business and is no laughing matter. In the year when the cartel was up and running, 2007, chocolate sales in Canada alone were estimated to be in excess of $1B, and naturally, annual sales of chocolate in the USA are well in excess of that type of number. When there are billions of dollars at stake, whether it's oil, heroin or chocolate (dark brown addictions one and all), corruption and criminal activity will rear their ugly heads.
Unlike Hershey's (who cooperated in the end), both Mars Canada and Nestlé Canada are denying the allegations and threatening to fight them:
"Mars Canada intends to vigorously defend itself against these allegations. It is Mars Canada's policy not to comment on pending litigation and we are therefore unable to make any additional comments in relation to this matter, which is now before the court.”
Uh-huh. And:
“Nestlé Canada will vigorously defend these charges,” it said. “At Nestlé Canada, we pride ourselves on operating with the highest ethical business standards.”
Sadly, even in a business as apparently sweet as chocolate manufacturing appears to be, when too much money is at stake there will always be those with an egregious hunger to be fed more and more - right into their bank accounts. As the nation pigs out reliably, and with a healthy dose of discreet price-fixing, the fatted calf grows to enormous proportions, probably in direct proportion to the nation's waistlines.
As shocking as it appears to be, it's really just another example of the sick greed that was exemplified in the financial meltdown of 2008/9 that almost bankrupted North America, but which was felt globally in the end. The chocolate manufacturers implicated in this case were probably no different than the corrupt bankers who sold pillar of salt-like mortgage-backed securities to unwitting buyers or those who awarded themselves huge bonuses even while realising the whole house was about to come crashing down around them. It's called sheer, ugly greed - a very appropriate term for an edible product that generates cold hard cash.
What's the positive that comes out of such stories? Sadly, I am not sure there is one. In a different world we would all be totally disgusted, and once the charges would be upheld, people in groups of millions would exert their outrage by boycotting Hershey's, Mars and Nestle products from now on - but we all know that isn't likely to happen.
On the contrary, due to how "everyday" these big brands are, and how popular their various products are, people will still go to the dispensing machine at work to grab a Mars Bar or stop at the corner store on the way home for some M&M's. I doubt that the profits of any corporation involved will diminish by any significant margin due to this scandal, and the train will keep on rolling very smoothly. It is what it is, as they say in the trade.
On that note, I have not even had a coffee yet on this Sunday morning, so it's definitely time for my Double Chocolate Deep Dark Delights Roast from Puerto Rico, and I can safely assure you that the chocolate used in this special blend is not sourced from either Hershey's, Mars or Nestle Canada. I am not sure how long I can last, but at least for today, I will consume chocolate that doesn't come with a serving of sinful greed running through its centre. ;) - Kevin Mc
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