Pennisi fined $470,000 over fuel scam
A BALLINA fuel wholesaler developed a scam in which he sold normal unleaded petrol to BP service stations as higher-octane fuel to undermine Woolworths and Coles competition, a court has heard.
Ballina Petroleum boss Santo Pennisi was yesterday fined $70,000 and his business fined $400,000 in the Federal Court of Australia in Brisbane over 28 offences against the Trade Practices Act.
He had previously pleaded guilty.
The court was told Pennisi ordered tankers to deliver normal unleaded petrol to bowsers labelled as premium, alternate and lead-replacement petrol at 11 BP service stations in the Ballina area, in northern NSW.
The scam ran for three years without BP's knowledge.
After it was revealed in June this year by a television current affairs show, Pennisi handed records detailing the timing and profits involved in the scam to the Australian Competition and Consumer Commission (ACCC).
The court heard Pennisi's wholesale company had made about $150,000 from the scam, but he had shown 'genuine remorse' and had tried to pay back his debt to the community.
Defence barrister Richard Lilley SC told the court the company had made a $200,000 donation to a local charity supporting driver education and had paid $100,000 to BP.
Mr Lilley said Pennisi was an 'uneducated person' who had a 'clumsy, uneducated reaction' in his struggle to maintain the family business after Coles and Woolworths entered the market.
He said the family business had also suffered. It no longer sold fuel and its annual net profit had fallen from $4.5 million to $2.5 million.
Justice John Logan said there was no excuse for Pennisi's dishonest behaviour that was essentially driven by greed.
He said he had ripped off trusting motorists and muddied the good name of a large corporation.
But he accepted that Pennisi regretted his actions and had tried to make amends by co-operating with investigators and giving money back to the community.
Meanwhile, a major inquiry into unleaded petrol prices by the competition watchdog has found petrol companies have a 'comfortable' oligopoly that is hindering competition.
The Australian Competition and Consumer Commission found 'no obvious evidence of price fixing or collusion', but did find 'fundamental structural issues' that hamper competitiveness. It found 98 per cent of the unleaded market is controlled by Shell, Caltex, BP and Mobil. AAP