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    AWB faces news class action filed in US

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    May 21, 2007 - 4:34PM
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    Wheat exporter AWB Ltd says a further class action has been filed against the company and its US subsidiary in New York.

    The action against AWB and AWB (USA) Ltd was filed in the US District Court for the Southern District of New York.

    It was filed by lawyers for Melvin Erb, who is described in the complaint as a US wheat farmer, on behalf of US hard red winter wheat farmers, for alleged violations of the RICO statute and US anti-trust laws.

    "The amount claimed is not quantified in the complaint, which has yet to be served on AWB," the company said.

    "AWB will vigorously defend the claim if it proceeds."

    The federal government is considering overhauling the single desk wheat exports system, after AWB was found to have paid $290 million in kickbacks to Iraq under the UN's corruption-ridden oil-for-food program.

    The future of Australia's wheat export system will be known on Tuesday when Prime Minister John Howard tells the coalition party room what cabinet has decided.

    The change comes after the now scandalised AWB was stripped of the so-called single desk because it paid kickbacks to the regime of deposed Iraqi dictator Saddam Hussein.

    It is almost certain cabinet has decided to maintain the single desk despite its abuse under AWB.
 
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