Questions over Richard Branson as BA four face court

Sir Richard Branson is set to be dragged into the trial of four British Airways executives accused of price fixing.

It is understood that lawyers will raise the question of how much the Virgin Atlantic founder knew about the collusion between his airline and BA in setting fuel surcharges between 2004 and 2006.

The two airlines have admitted collusion, but four BA executives will today go on trial at Southwark Crown Court in the first case under anti-cartel legislation introduced in 2003.

Martin George, the former BA operations director; Iain Burns, the former communications director; Alan Burnett, the former head of UK sales; and Andrew Crawley, the current sales and marketing director, have all pleaded not guilty. The maximum sentence they face if convicted is five years in jail and an unlimited fine

Virgin blew the whistle on the conspiracy four years ago and both the airline and its executives have been granted immunity from prosecution.

However, the court case comes at a bad time for Sir Richard, who is trying to break into the British banking sector with a bid for the Royal Bank of Scotland’s branch network and possibly Northern Rock when it goes on sale.

Bank ownership is regulated by the Financial Services Authority, which applies a "fit and proper person" test to executives. Sir Richard would not be subject to the test because he is not an executive of Virgin Money, but selling banks is highly political and bidders must be whiter than white.

The Office of Fair Trading (OFT), which is prosecuting the BA executives, is expected to call a number of witnesses from Virgin Atlantic.

These are likely to include Steve Ridgway, the chief executive, Paul Moore, the former communications director, who is now with First Group, and Willy Boulter, the former operations director.

All three were named in the indictment submitted to the court last July. Sir Richard has not been called as a witness or named as a person of interest by the OFT in relation to the case.

Andreas Stephan, a competition law expert at the University of East Anglia, said: "The OFT’s task in the BA case is unenviable: to convince a jury that the BA four acted dishonestly and knew they were acting dishonestly, in talking to each other about surcharges."

(Published by Times Online- April 12, 2010)