Global parcel delivery service UPS will pay $25 million to settle charges it broke promises of overnight delivery and deliberately hid delays, the US Justice Department said Tuesday.
The department said that the Atlanta, Georgia-based company repeatedly did not meet the standards of its Next Day Air delivery service under contracts with the government over a 10-year period.
In addition, it said UPS, in order to block late-delivery claims from government clients, knowingly reported false delivery times, or blamed the delays on other fake issues like "security delay" or "customer not in."
"The United States should get what it pays for, nothing less," said Robert Erickson, acting inspector general of the government's huge General Services Administration, a key customer of UPS.
The case came up after a former UPS employee brought the information on the company's behavior to light via a "whistleblower" lawsuit on behalf of the government.
UPS agreed to pay $25 million to resolve the civil charges. Of that, $3.75 million will go to the ex-UPS employee, Robert Fulk.
The company said in a statement that it agreed to the settlement "to avoid lengthy and costly litigation, though we continue to disagree with the government's position."
"The settlement notes there is no acknowledgement of liability by UPS," it said.