Attorney General Mark Herring today announced a $4 million settlement with United Parcel Service (UPS), the world’s largest package delivery company, stemming from allegations that its employees violated the Virginia Fraud Against Taxpayers Act and the false claims laws of 13 other states, and the cities of New York City, Washington, D.C. and Chicago.
The agreement resolves allegations contained in a multi-state complaint filed in the Eastern District of Virginia that certain UPS employees violated the law by recording inaccurate delivery times and inappropriately using “exception codes” on packages sent by government customers via UPS next-day delivery services. Government customers, and therefore taxpayers, paid for premium-priced packages that appeared to be delivered by their guaranteed times when, in fact, they were not.
Under the agreement, the Commonwealth of Virginia will recover $241,056 in compensation for these inaccurately recorded late deliveries.
“Virginia taxpayers paid for guaranteed delivery times and UPS failed to live up to their end of the bargain,” said Attorney General Herring. “We’re working every day to defend the rights of Virginia consumers and their government against corporations that improperly profit at the expense of taxpayers.”
In addition to compensation to the Commonwealth, UPS has instituted remedial training, monitoring, and reporting compliance programs to address any potential delivery failures or policy violations.
The settlement covers allegations of wrongdoing from 2004 to 2014 against tens of thousands of government agencies in New York, California, Delaware, Florida, Hawaii, Illinois, Indiana, Massachusetts, Minnesota, Montana, New Mexico, North Carolina, Tennessee, and Virginia, and the three cities. Attorney General Herring’s office was part of a multi-jurisdictional group investigating these allegations against the shipping company, led by New York Attorney General Eric Schneiderman.
Assistant Attorney General Peter E. Broadbent, III represented the Commonwealth in this matter.