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American Airlines Agrees To Pay $22M To Settle False Claims Act Allegations Over Mail Delivery

FORT WORTH (CBSDFW.COM) - Fort Worth-based American Airlines has been hit with an approximately $22.1 million fine from the U.S. Department of Justice.

The airline was accused of falsely reporting the times it handed over mail from the postal service for delivery overseas.

"We expect companies doing business with the government to comply with their contractual obligations," said Assistant Attorney General Jody Hunt of the Department of Justice's Civil Division. "The Department of Justice vigorously pursues all manner of fraudulent conduct that undermines the benefits that the government has bargained for."

USPS contracted with American Airlines to take possession of receptacles of United States mail at six locations in the United States or at various Department of Defense and State Department locations abroad, and then deliver that mail to numerous international and domestic destinations, The Department of Justice explained in a news release.

To obtain payment under the contracts, American Airlines was required to submit electronic scans of the mail receptacles to USPS reporting the time the mail was delivered at the specified destinations. The contracts specified penalties for mail that was delivered late or to the wrong location.

Tuesday's settlement resolves allegations that scans submitted by American Airlines falsely reported the time it transferred possession of the mail.

"The U.S. Postal Service contracts with commercial airlines for the safeguarding and timely delivery of U.S. Mail to foreign posts, including the mail sent to our soldiers deployed to foreign operating bases," said Scott Pierce, Special Agent in Charge, USPS Office of Inspector General. "The Office of Inspector General supports the Postal Service by aggressively investigating allegations of contractual non-compliance within the mail delivery process, including the falsification of delivery information. Our special agents worked hand-in-hand with the Department of Justice's Civil Division to help ensure a reasonable resolution and we applaud the exceptional work by the investigative and legal team."

American said it has invested in new equipment and procedures to handle the mail.


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