(CN) – United Parcel Service Co. will pay more than $25 million to settle claims it falsified records to collect more for overnight packages to government customers.
UPS provides delivery services to scores of federal agencies through contracts with the General Services Administration and the U.S. Transportation Command — an agency that supports the U.S. Defense Department.
According to the government, the Atlanta-based package delivery company guaranteed next-day delivery of packages by specific times under those contracts.
The settlement announced Tuesday by the U.S. Department of Justice stems from a whistleblower lawsuit in Federal Court in Virginia. In that lawsuit, Robert Fulk, a former UPS driver and manager, claimed that between 2004 and 2014, UPS recorded incorrect delivery times to make it appear its deliveries had arrived on schedule.
Through this and other means — including making up false reasons for deliveries that were undeniably late — UPS was able to avoid paying significant refunds for late deliveries, Fulk claimed.
Under the terms of the settlement, UPS will pay $25 million to the federal government and $740,000 to the state of New Jersey.
The settlement does not include an admission of liability by UPS, and Susan Rosenberg, a spokeswoman for the company, said the company continues to dispute the government’s claims.
“UPS values its relationship with all of its customers and continues to be valued supplier in good standing with the federal and state government,” the company said in a written statement. “When notified of this issue, UPS focused to improve training systems and technology to better serve our customers.”
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