FedEx Charged with Shipping for Illegal Web Pharmacies

By: CBS MoneyWatch
By: CBS MoneyWatch

July 18, 2014

CBS MoneyWatch - A serious charge has been delivered to FedEx's doorstep.

The operator of the world's largest cargo company has been indicted for allegedly delivering prescription drugs and controlled substances on behalf of illegal Internet pharmacies, according to a statement from the U.S. Department of Justice. The indictment claims that FedEx continued to deliver drugs, violating federal and state laws, for the illegal web outfits even after it was warned by federal authorities a decade ago.

The indictment claims FedEx made at least $820 million by shipping the drugs, while the company could be fined twice that amount if it's found guilty. The charges come more than a year after UPS settled similar charges, with the delivery company, agreeing to pay $40 million and setting up a program to ensure it wouldn't again ship drugs for illegal web pharmacies. FedEx has denied wrongdoing.

"FedEx is innocent of the charges brought today by the Department of Justice," said Patrick Fitzgerald, senior vice president of marketing for FedEx, in a statement. "We will plead not guilty. We will defend against this attack on the integrity and good name of FedEx and its employees."

FedEx said it transports more than 10 million packages a day, and that the "privacy of our customers is essential to the core of our business." The charges from the Justice Department is placing that privacy "at risk," the company said.

"We want to be clear what's at stake here: the government is suggesting that FedEx assume criminal responsibility for the legality of the contents of the millions of packages that we pick up and deliver every day. We are a transportation company -- we are not law enforcement," Fitzgerald said in the statement.

FedEx has been asked to appear in federal court in San Francisco on July 29.

The indictment charges that FedEx knew it was delivering drugs to addicts and dealers, with couriers expressing worries about safety to senior managers.

Couriers' concerns included aggressive behavior by pharmacy customers, who would stop trucks on the road to demand their deliveries, as well as delivery addresses that turned out to be vacant homes or parking lots where "several car loads of people were waiting for the FedEx driver to arrive with their drugs," according to the Department of Justice statement.

In other instances, customers jumped on FedEx trucks to demand their drugs, with drivers receiving threats if they failed to hand over the packages, according to the allegations.

Drugs that were delivered illegally include controlled and prescription drugs such as Phendimetrazine, an appetite suppressant and stimulant, and the sleeping drug Ambien.


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