UPS Settles False Claims Act Allegation

UPS has agreed to pay about $5.3 million to resolve its potential liability under the False Claims Act for falsely reporting information about the transfer of U.S. mail to foreign posts or other intended recipients under contracts with the U.S. Postal Service, the Department of Justice said in a recent news release.

The Postal Service contracted with UPS to pick up U.S. mail at six locations in the United States and at various Department of Defense and State Department locations abroad, and then deliver that mail to numerous international and domestic destinations. Payment terms in the contracts required UPS to submit electronic scans to the Postal Service reporting the time the mail was delivered at destination, with specified penalties for late or incorrect delivery. "The settlement resolves allegations that scans submitted by UPS falsely reported the time and fact that it transferred possession of the mail," DOJ said.

This is the fifth civil settlement involving air carrier liability for false delivery scans under the Postal Service’s program for international commercial air contracts. Collectively, the U.S. government has collected more than $70 million as a result of its investigation of international mail delivery, including $49 million from United Airlines a year ago, $22 million from American Airlines, $4.7 million from Northern Air Cargo and $5.8 million from partners British Airways and Iberia Airlines, Freightwaves/American Shipper reported.

The USPS Office of the Inspector General and the USPS Office of General Counsel were involved in the resolution of this case, DOJ reported.