Federal Contractor Misconduct Database (FCMD)
New York Contraband Cigarette Trafficking Lawsuit
New York City and the New York attorney general sued FedEx, accusing the company of illegally delivering contraband cigarettes to state residents, in violation of a 2006 agreement with the attorney general and the Racketeer Influenced and Corrupt Organizations Act (RICO). The lawsuit claimed that FedEx shipped several tons of unstamped cigarettes (nearly 80 million cigarettes; approximately 400,000 cartons) to individuals other than licensed dealers or distributors between 2005 and 2012, resulting in the loss of more than $10 million in taxes. In January 2019, FedEx settled the lawsuit, agreeing to pay $35.3 million, implement internal reforms, and hire an independent compliance consultant.
- Misconduct Type
- Enforcement Agency
- Contracting Party
- Court Type
- Date of Settlement Announcement