UPS to pay $40 million collected from online pharmacies to end criminal probe

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SAN FRANCISCO — Shipping company UPS agreed Friday to pay $40 million to end a federal criminal probe connected to deliveries it made for illicit online pharmacies.

The U.S. Department of Justice announced the Atlan­ta-based company would also “take steps” to block illicit online drug dealers from using their delivery service.

The DOJ said the fine amount is the money UPS collected from suspect online pharmacies. UPS won’t be charged with any crimes.

“We believe we have an obligation and responsibility to help curb the sale and shipment of drugs sold through illegal Internet pharmacies,” UPS spokesman Bill Tanner said. “UPS will pay a $40 million penalty and has agreed to enhance its compliance policies with respect to Internet pharmacy shippers.”

Its biggest rival, FedEx Corp., remains a target in the federal investigation, according to its March 21 quarterly report filed with the Security and Exchange Commission.

“We believe that our employees have acted in good faith at all times,” FedEx stated in its regulatory filing. “We do not believe that we have engaged in any illegal activities and will vigorously defend ourselves in any action that may result from the investigation.”

FedEx said it received subpoenas from a federal grand jury in San Francisco in 2008 and 2009. The San Francisco U.S. Attorney’s office has played a central role in a nationwide crackdown on online pharmacies. Ten people with ties to online pharmacies have been convicted over the past two years.

“It is unclear what federal laws UPS may have violated,” FedEx said in statement Friday. “We remain confident that we are in compliance with federal law.”

The DOJ said some UPS employees knew the company was making deliveries between 2003 and 2010 for pharmacies that filled orders for dangerous drugs without prescriptions from doctors.

“Despite being on notice that this activity was occurring, UPS did not implement procedures to close the shipping accounts of Internet,” the DOJ said in a prepared statement.

FedEx said federal investigators have declined to supply a list of suspect pharmacies. The company said it “can immediately shut off shipping services to those pharmacies” if given a list.

A DOJ spokesman declined to comment about the FedEx investigation.

In a prepared statement announcing the UPS settlement, Food and Drug Administration criminal chief John Roth said the “FDA is hopeful that the positive actions taken by UPS in this case will send a message to other shipping firms to put public health and safety above profits.”

Earlier this week, a federal judge in San Francisco sentenced Chris Napoli to four years in prison and ordered to forfeit $24 million his illicit pharmacy Safescripts Online earned between 2004 and 2006. Two other men were sentenced to prison along with Napoli. Receipts from UPS and FedEx were used as evidence in the trio’s trial last year.

In 2011, Google Inc. agreed to pay $500 million to settle allegations by the Justice Department that it profited from ads for illegal online pharmacies.

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dichotomy
26889
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dichotomy 03/30/13 - 10:13 am
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So the DOJ and the FDA are

So the DOJ and the FDA are placing the blame for not doing THIER jobs on UPS and Amazon? Is it UPS's responsibility to know if every package they ship is from a legitimate source? Is it Amazon's responsibility to check every advertiser to see if they are in compliance with federal law? If the feds knew these drug companies were illegal, WHY DIDN'T THEY JUST ARREST THOSE FOLKS? Seems like that would have stopped the shipping and the advertising.

Oh, and they singled out UPS while letting FEDEX continue to march. Is the administration picking winners and losers again....maybe based on political affiliation and campaign contributions? And how about the BUYERS of all of these illegal prescription drugs. Oh no, it's all about getting big buck settlements from a legitimate business.

chascushman
6653
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chascushman 03/31/13 - 04:55 pm
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“So the DOJ and the FDA are

Unpublished

“So the DOJ and the FDA are placing the blame for not doing THIER jobs on UPS and Amazon?”
No surprise we have an idiot running the DOJ.

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