UPS corporate overgoods is where UPS sends all different kinds of items that have either fallen out of packages or are missing a box.
At the UPS center there is a overgoods area that the employees work on re-boxing boxes and putting these loose items into their correct boxes by using the packing list and so on. Whatever is not found in a box is sent to corporate overgoods. Corporate Overgoods is just a center (there are various in the US, it just depends where your package is being sent to) that holds lost items so that the owners can find them. Corporate Overgoods holds these items for up to 3 months, and it is a very quick process so if you do lose an item, contact UPS asap and they will direct you to Corporate Overgoods where they will help you find your missing items.
Before you freak out that UPS is destroying packages and you should not trust them keep in mind that UPS is not alone. USPS and FEDEX also have a very similar process and break packages just as much. Out of more than 80,000 packages that run throughout a UPS center a day, only about 5-15 boxes are destroyed. It is very unlucky if you are the 5-15 boxes, but UPS does and will refund you.
Lastly, UPS is a international company, that means that their are billions of packages coming in and out of UPS DAILY. When there are only 5-15 packages that are destroyed out of 80,000+, that is pretty good for such a large company, AND UPS will refund you for your lost item.