I've had something similar when a company put a different address on the package than what they entered when creating the shipping label. I placed an order and didn't catch that it had my old address. I emailed them to fix it, but their fix was to generate the shipping label using the old address, then slap a sticker with my new address over just the address portion of the shipping label.
The result is, whenever the barcode got scanned, the system routed the package to my old address. When a human looked at the address on the box, they saw it was not for their area and put it in the bin to go back to the main hub. At the hub, the automated systems scanned the barcode and sent it back to the same place it came from. This looped several times before someone realized there was an issue and corrected it.