FedEx Faces Federal Indictment on Decade-Long Drug Trafficking Charges

One of the world's largest couriers has been accused of conspiring to deliver prescription drugs on behalf of illegal Internet pharmacies.

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By Geoff Weiss

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FedEx, one of the largest shipping businesses in the world, has been indicted by a federal grand jury for conspiring to deliver prescription drugs from illegal Internet pharmacies.

The Drug Enforcement Administration (DEA), Food and Drug Administration (FDA) and members of Congress initially warned FedEx of the illegal shipping activity roughly a decade ago, according to the indictment.

Nevertheless, FedEx "knowingly and intentionally conspired to distribute controlled substances" like Ambien and Diazepam in collaboration with two Internet pharmacies, the Chhabra-Smoley Organization and Superior Drugs, the Justice Department said.

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Even after these pharmacies were shut down by state and federal law enforcement and their owners had been arrested, FedEx continued to deliver the drugs, the indictment says. Overall profits resulting from these deliveries are said to be roughly $820 million.

In some cases, when FedEx couriers in Kentucky, Tennessee and Virginia complained to senior management about being directed to seedy delivery addresses or of customers jumping on their trucks and demanding packages of pills, the company simply adopted a policy by which these packages could be held for pick up at FedEx stations.

FedEx has been summoned to court in San Francisco on July 29, and faces a maximum fine of $1.64 billion, among other penalties.

Related: Burger With A Side of Heroin? McDonald's Worker Found Selling Drugs in Happy Meals

"This indictment highlights the importance of holding corporations that knowingly enable illegal activity responsible for their role in aiding criminal behavior," U.S. Attorney Melinda Haag said.

In response, FedEx's senior vice president of marketing and communications, Patrick Fitzgerald, told USA Today, "We are a transportation company -- we are not law enforcement."

"Whenever DEA provides us a list of pharmacies engaging in illegal activity, we will turn off shipping for those companies immediately," he added. "So far the government has declined to provide such a list."

Related: 4 Steps to Deal with an Employee's Substance Abuse Problem

Geoff Weiss

Former Staff Writer

Geoff Weiss is a former staff writer at Entrepreneur.com.

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