Friday 28th Oct 2016 - Logistics Manager

FedEx pays £4.9m for false claims allegations

FedEx has agreed to pay the United States £4.9 million ($8 million) to settle a whistleblower lawsuit that alleged the company fraudulently avoided reimbursing customers for missed deliveries.

A FedEx employee brought the lawsuit alleging that FedEx couriers falsely used security-delay exception codes, to excuse their own failures to deliver Priority Overnight packages on time and to avoid reimbursing government customers.

US attorney Machen said: “Companies that commit to provide services to the United States are expected to meet their commitment and not ‘game the system’ to take advantage of their government customers for the benefit of their own bottom line.”

In the US, The False Claims Act permits private individuals, called relators, to bring whistleblower lawsuits on behalf of the United States. The settlement was the result of a co-ordinated effort by the US attorney’s office for the District of Columbia, the Inspector General’s office for the Department of Justice, the Inspector General’s office for the General Services Administration, and the Inspector General’s office for the Department of Agriculture.

Assistance was also provided by the Naval Criminal Investigative Service.