Sky Lease Cargo settles fraud case over Postal Service contract for $1M

Miami-based airline fudged shipping data, authorities allege

A Sky Lease Cargo 747-400 jumbo jet transfers cargo at Los Angeles International Airport on Nov. 15, 2024. (Photo: Shutterstock/Karolis Kavolelis)

Sky Lease Cargo, a small all-cargo operator based at Miami International Airport, has agreed to pay more than $1 million to resolve allegations that it manipulated data about the transport of mail to U.S. diplomatic or military posts, the U.S. Department of Justice announced Tuesday.

Sky Lease I Inc., the company’s legally registered name, had contracts with the U.S. Postal Service to pick pick up mail bins at overseas Department of Defense and State Department locations and deliver the mail to numerous international and domestic destinations. To obtain payments under the contracts, Sky Lease was required to submit electronic scans of the mail receptacles to the Postal Service reporting the time the mail was delivered at the designated destinations. The settlement resolves allegations that scans submitted by Sky Lease falsely reported the time that it transferred possession of the mail.

Sky Lease Cargo operates two Boeing 747-400 freighter aircraft, according to the Planespotters database. The airline subleased its main terminal at Miami airport in early April and terminated 129 employees, including 88 full-time workers, according to a required notice filed with the Florida Department of Commerce earlier this year. The carrier currently operates between Miami and Zhengzhou, China, from a different location at Miami airport, a sales agent who answered the phone said. 

The U.S. Postal Service Office of Inspector General originally investigated the alleged fraud.

The case resembles ones that previously ensnared United Airlines, American Airlines and UPS. The airlines falsified the time stamps to avoid financial penalties for not meeting on-time delivery requirements and other specifications.

“The Department of Justice is committed to ensuring that government contractors provide the services they have contracted to provide,” said Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division. “When contractors knowingly fail to provide services for which they have been paid, the Department of Justice will pursue appropriate remedies to redress the violations and deter future ones.”

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United Airlines settles fraud case over Postal Service contract for $49M

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Eric Kulisch

Eric is the Parcel and Air Cargo Editor at FreightWaves. An award-winning business journalist with extensive experience covering the logistics sector, Eric spent nearly two years as the Washington, D.C., correspondent for Automotive News, where he focused on regulatory and policy issues surrounding autonomous vehicles, mobility, fuel economy and safety. He has won two regional Gold Medals and a Silver Medal from the American Society of Business Publication Editors for government and trade coverage, and news analysis. He was voted best for feature writing and commentary in the Trade/Newsletter category by the D.C. Chapter of the Society of Professional Journalists. He was runner up for News Journalist and Supply Chain Journalist of the Year in the Seahorse Freight Association's 2024 journalism award competition. In December 2022, Eric was voted runner up for Air Cargo Journalist. He won the group's Environmental Journalist of the Year award in 2014 and was the 2013 Supply Chain Journalist of the Year. As associate editor at American Shipper Magazine for more than a decade, he wrote about trade, freight transportation and supply chains. He has appeared on Marketplace, ABC News and National Public Radio to talk about logistics issues in the news. Eric is based in Vancouver, Washington. He can be reached for comments and tips at ekulisch@freightwaves.com