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FedEx charges raise online pharmacy issues

By WTOP Staff

PAUL ELIAS
Associated Press

SAN FRANCISCO (AP) — FedEx Corp., the latest company accused in a federal probe involving illegal online pharmacies, says it will fight the charges that it knowingly shipped drugs to people who lack valid prescriptions.

The company says it would have to invade the privacy of customers to stop such deliveries.

By contrast, UPS Inc. paid $40 million last year to resolve similar allegations and vowed to overhaul its procedures and work with investigators to detect suspicious activity.

The contrasting responses to the decade-long federal probe of the prescription drug black market underscore the difficulty shippers have in determining how far to go to ferret out illicit online pharmacies among their customers and to alert the government.

Wall Street analysts, legal experts, anti-drug crusaders and the companies themselves are split on the issue.

FedEx could face $1.6 billion in penalties after its July 17 indictment on charges that it conspired with illegal online pharmacies to deliver prescription drugs to customers it knew lacked valid prescriptions.

The federal investigation of the two shipping giants stems from a blitz against online pharmacies that was launched in 2005. Since then, dozens of arrests have been made, thousands of websites shuttered and tens of millions of dollars and pills seized worldwide as investigators broadened the probe beyond the operators.

Google Inc. in 2011 agreed to pay $500 million to settle allegations by the U.S. Department of Justice that it profited from ads purchased by online pharmacies that the search giant knew was improperly selling prescription drugs.

Many online pharmacies fill orders without following proper prescription protocols, often requiring a customer to simply fill out an online form that is reviewed remotely by a physician.

“The advent of Internet pharmacies allowed the cheap and easy distribution of massive amounts of illegal prescription drugs to every corner of the United States, while allowing perpetrators to conceal their identities through the anonymity the Internet provides,” said San Francisco-based U.S. Attorney Melinda Haag

Companies up and down the online pill supply chain have been grappling with defining their duty to uncover and report questionable Internet pharmacies.

“We are a transportation company — we are not law enforcement,” said FedEx spokesman Patrick Fitzgerald. He said FedEx has often worked with investigators to thwart illegal drug activity during the company’s 43-year history.

Fitzgerald said that to comply with Drug Enforcement Agency demands to determine and then disclose to the agency customers who are illegally shipping prescription drugs would require the company to violate the privacy of its customers.

The Memphis, Tennessee, shipping giant is echoed by Wall Street analysts and some legal experts who argue that FedEx, which handles 10 million packages daily, is not equipped or responsible for playing a leading role in investigating online pharmacies.

The company was indicted in San Francisco federal court on 15 felony counts of conspiring with two illicit online pharmacies.

“This is an unprecedented action by the DEA,” said Larry Cote, a former DEA lawyer now in private practice. “This will definitely have a chilling effect on the industry as a whole. And it’s a very slippery slope the DEA is going down. Do they go after utilities and banks next?'”

At the opposite end of the spectrum is FedEx rival UPS. To avoid similar criminal charges, the Atlanta-based company agreed last year to pay $40 million and change its policies and procedures, including appointing a compliance officer to monitor online pharmacies.

The officer’s job is to report suspicious activity to senior executives and federal investigators. UPS was also required to hire an outside auditor to oversee the compliance officer and both appointments were approved by the DOJ, UPS spokeswoman Susan Rosenberg.

“The issue of illegal online pharmacies is not about privacy but a matter of supply chain integrity and the creation of processes to ensure that illegal activity is not facilitated,” Rosenberg said. She said the agreement with the government doesn’t require UPS to search packages.

Rosenberg declined to specify how UPS is checking out online pharmacies, but the company’s agreement with the DOJ said screening can be as simple as an online search of the pharmacy’s website.

Mitchell Epner, a former federal prosecutor now in private practice, said FedEx and its competitors have an obligation to not ship things that they know are contraband.

In the FedEx indictment, prosecutors cite several instances in which they allege the company was warned that it was engaged with suspect pharmacies.

The Center for Safe Internet Pharmacies, launched in 2010, includes Google, Facebook, UPS and other companies that share data about suspect pharmacies and puzzle over solutions for dropping illicit shipments.

“The shipping question is a very hard one to answer,” said center chief Marjorie Clifton. “They can’t open every package.”

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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