WASHINGTON – California-based companies Quicksort Inc., Quicksort LA Inc. and Quicksort Sacramento Inc. have agreed to pay the United States $4.2 million to settle allegations that Quicksort violated the False Claims Act by falsely representing the level to which it had pre-sorted mailings in order to obtain discounted postage rates from the U.S. Postal Service, the Justice Department announced today.
The U.S. Postal Service offers lower postage rates to mailers who automate and sort their mail by zip code because these steps save the Postal Service time and money. Mailers use the services of businesses such as Quicksort that combine the mail of many customers and pre-sort it in order to qualify for the pre-sort discounts. After processing customers’ mail, these pre-sort businesses present the mail to the Postal Service for mailing.
The settlement resolves allegations that the Quicksort companies misrepresented the pre-sort level of mail they submitted to the U.S. Postal Service at various times in 2008, 2009 and 2010.
“Making false claims to obtain discounted postage rates is dishonest, and such conduct interferes with the Postal Service’s effort to swiftly and accurately deliver the mail,” said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. “We will hold businesses accountable for underpaying for postage and will ensure that taxpayer funds are protected from fraud and abuse.”
“The Postal Service enters into mailing agreements with entities such as QuickSort to help ensure the US mail is collected, prepared, and delivered as cost effectively and efficiently as possible,” said Benjamin B. Wagner, U.S. Attorney for the Eastern District of California. “When a pre-sort business overstates the level of presorting it has performed, the Postal Service not only pays for services not rendered, but then also has to incur the costs of sorting the mail to its proper ZIP Code. The False Claims Act provides a powerful remedy when this activity occurs.”
“The Postal Inspection Service investigates these types of cases to not only protect the Postal Service but also protect the mailing community from those who seek to gain an unfair competitive advantage,” stated Postal Inspector-in-Charge Adam P. Behnen.
The settlement was reached by the Commercial Litigation Branch of the Justice Department’s Civil Division and the U.S. Attorney’s Office for the Eastern District of California. The U.S. Postal Inspection Service investigated the matter.
source: U.S. Justice Department
we have a few of these mailhouses around omaha but they have a bulk mail clerk on site checking mail with documentation. no matter what, the mailer is respnosible for defiencies
For more than 200 years, the mission of the United States Postal Service has been to provide universal service at uniform rates. That is our mandate.
In 1976 Postal management made exceptions to the uniform-rate requirement and established work share discounts; but this exception does not modify the legal requirement for uniform rates. Therefore, all large mailers that participate in the ill-conceived postal ‘work share discounts” program are in violation of the “uniform-rate requirement”. This is not a technicality—it’s the law.
The American Postal Workers Union (APWU) fought hard and persistently against this policy and in 2006, Congress clarified the uniform-rate requirement and decreed that work share discounts could not exceed the costs the Postal Service avoids if work is performed by private mail consolidators; rates can be reduced only by the value of the work performed by the private contractors.
The truth is the postal system would do just fine if the mailers performed no mail-processing activity and paid the uniform rate. Management has invested a sum of over $50 billion in automation, computerization, facility redesign, and the incorporation of remote encoding capabilities into the USPS mail processing system. This investment made the Postal Service more efficient and brought down the cost of mail processing. Avoided costs are lower. However, work share discounts have actually increased from 7.6 percent of the postage rate in 1976 (a one-cent discount on the 13-cent cost of a first-class letter) to 23.9 percent in 2009 (a 10.5-cent discount on the 44-cent cost of a first-class letter). These discounts diminish the USPS return on investment.
I have news for Postal Inspector in-Charge Adam P. Behnen. It seems to me that while the Quicksort companies may have indeed misrepresented the size of their slice of the work share discount pie, the real violator in-charge here is PMG Potter who has become a shill for the big mailers.
I’ve got 35 years invested in the USPS and always been proud to serve through split days off, mandatory overtime in December, and working under supervisors driven by performance numbers-based bonuses. I’ve seen it all and I must tell you that after nine years with PMG Potter, I’m starting to miss Marvin Runyon.
It’s just a little sad to see that even the AG from the Dept. of Justice gets it wrong when equating “taxpayer funds” with Postal revenue.
Another private business or greedy CEO trying to steal their way to money and power!