US farmers have launched a class action seeking hundreds of millions of dollars in compensation from Australian wheat export agency AWB, accusing it of racketeering, bribery, money laundering and fraud, reports The Age.

The allegations are set out in the explosive Statement of Claim filed in Washington DC.

The court document alleges that AWB violated the Racketeer Influenced and Corrupt Organizations Act, or "RICO".

It accuses AWB of conspiring to "utilize illegal tactics such as wire fraud, bank fraud, bribery, money laundering and tortuous interference with business opportunity in order to gain an unfair competitive advantage in certain wheat markets including, but not limited to, Iraq, Pakistan, Yemen and indonesia."

"Through a private corporation based in Australia and its United States subsidiary, the Defendants controlled the entire Australian wheat export market and transacted legitimate business with one another and others through American banking channels in New York while also operating a racketeering enterprise aimed at harming the business of American wheat farmers...Said racketeering activity enabled the Defendants to secure and maintain exclusive export markets and proximately caused economic injury to the property and business of the Plaintiffs and the members of the putative class, who were deliberately excluded from those markets as a direct result of said bribery and the continued concealment of said bribery as part of the Defendants' continuing pattern of racketeering activity."

The statement of claim alleges AWB bribed Yemeni and Pakistani officials, and was also involved in fraudulent debt recovery with laundered funds, with the help of the world's biggest miner BHP Billiton.

It accuses AWB of abusing the UN oil-for-food program and slinging bribes to Iraqi officials, with the shonky payments disguised as costs and fees. It also alleges AWB tried to cover up the scandal and accuses certain AWB officials of perjury when they were called before the Cole Inquiry set up by the Australian Government.

AWB was always a disaster waiting to happen.

As I maintained in a blog earlier this year, AWB's system of corporate governance was designed in a way to deliver certain outcomes that put wheat growers in the box seat.

The bribery scandal, uncovered by former U.S. Federal Reserve chairman Paul Volcker, was an inevitable result. And by extension, so was the class action.