“Florida Man” defrauds the Post Office
A Florida man could face up to 20 years in prison and up to $750,000 in fines for fraudulent claims against the United States Postal Service. Although he is being charged criminally, a whistleblower could just have easily filed suit under the federal False Claims Act, which applies to false claims from any government entity, including the U.S. Postal Service. The last big False Claims Act settlement related to the Post Office was a $5 million settlement with Lance Armstrong, who was famously sponsored by the USPS.
Jim Garcia-Albarracin has been federally charged with running a $1.5 million fraud for allegedly filing false claims on merchandise he sold with his online company. He was arrested last week and charged with 10 counts of mail fraud, 10 counts of wire fraud, and 12 counts of money laundering.
Garcia-Albarracin sold a variety of products through online marketplaces such as Listia and eBay. He would then purchase insurance through USPS and allegedly later file a claim stating that the contents of the packages had been damaged. To receive compensation for his scheme, Garcia-Albarracin would allegedly provide fake photos that “purportedly depicted damage to the products,” authorities said. He received payment from USPS via checks deposited to assorted accounts which would ultimately make their way to Garcia-Albarracin. Multiple accounts were designed “to conceal and disguise the nature, location, source, ownership, and control of the proceeds of the specified unlawful activity,” according to the charging documents.
Under the False Claims Act, Garcia-Albarracin would potentially have to repay three times the $1.5 million in ill-gotten gains under the statute’s trebling provision. Moreover, he would be subject to civil monetary penalties of up to $22,000 per false claim. A whistleblower would receive a relator’s share of between 15% and 30% of any recovery for bringing a successful case.