FedEx Indicted for Drug Dealing Following Decade-Long Investigation

FedEx has been charged with shipping prescription drugs for illegal online pharmacies, the FDA said in a statement Friday.

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FedEx has been charged with shipping prescription drugs for illegal online pharmacies, the FDA said in a statement Friday.

A federal grand jury in San Francisco indicted the shipping company, alleging it had knowingly conspired with two separate but related online pharmacies – the Chhabra-Smoley Organization, whose founder was arrested in 2003, and Superior Drugs – for nearly a decade.

According to the indictment, "trucks had been stopped on the road by Internet pharmacy customers demanding packages of pills; delivery addresses included parking lots, schools, and vacant homes where people would wait for deliveries of drugs; customers would jump on FEDEX trucks and demand Internet pharmacy packages."

In response to employee complaints, the company says it set up special credit policies for such sites and "approved a procedure whereby Internet pharmacy packages from problematic shippers were held for pick up at specific stations." Still, prosecutors say the FedEx was just covering its tracks with the measures, and to prevent loss of money if police shut down and illegal sites.

"FedEx knew that it was delivering drugs to dealers and addicts," a press release from the U.S. Attorney's Office of the Northern District of California said.

In a written statement, FedEx Senior Vice President for Marketing and Communications Patrick Fitzgerald said the company is innocent.

We have repeatedly requested that the government provide us a list of online pharmacies engaging in illegal activity. Whenever DEA provides us a list of pharmacies engaging in illegal activity, we will turn off shipping for those companies immediately. So far the government has declined to provide such a list.

We are a transportation company – we are not law enforcement.

However, prosecutors say DEA and FDA officials, along with members of the Congress, warned FedEx at least six times since 2004 about illegal Internet pharmacies using their shipping service.

The government is seeking more than $800 million, the amount it believes the FedEx earned helping dealers. The company has been summoned to federal court for a hearing July 29 in San Francisco.

This article is from the archive of our partner The Wire.