For more than 200 years, the U.S. Postal Inspection Service has been responsible for safeguarding the customers of the U.S. Postal Service. As the criminal investigative arm of the U.S. Postal Service, postal inspectors protect postal employees, the mail and postal facilities from criminal attack and protect consumers from being victimized by fraudulent schemes or other crimes involving the mail. The nation�s mail service was designed to ensure a reliable, efficient, affordable and secure means of communication, and it�s the mission of the Postal Inspection Service to prevent unscrupulous promoters from damaging that confidence.
The Postal Inspection Service has been fighting all types of fraud against businesses, government agencies and postal customers since the mail fraud statute was enacted in 1872. While schemes have changed throughout the years, con artists take advantage of economic trends and current events and plan their schemes accordingly. In today�s fast-paced society and modern technology, the magnitude of fraudulent schemes involving the mail is much greater and impacts more people than ever before.
The Postal Inspection Service devotes considerable resources to protecting the business community from being victimized by fraudulent schemes in which the US mail is involved. During the fiscal year 2000, Postal Inspectors conducted 1,379 investigations related to fraud against businesses, which resulted in 650 arrests. While the Postal Inspection Service investigates the numerous fraudulent schemes that victimize businesses, schemes of particular concern deal with office supplies and �yellow pages� invoices.
Office Supply Schemes
Businesses are conned out of millions of dollars each year by bogus office supply firms. Typically, the schemes involve goods or services that are routinely ordered by businesses such as copier paper, toner, maintenance supplies, equipment maintenance contracts or advertising. Con artists take advantage of businesses� inadequate purchasing procedures or of unsuspecting employees who may not be aware of office practices. Often, office supplies peddled by con artists are overpriced and of poor quality and the services are usually worthless.
Toner Fraud
Toner fraud schemes often involve direct mail solicitations used by con artists to legitimize a bogus invoice for toner by including a microscopic disclaimer such as, �This is not a bill, this is a solicitation.� In most instances, however, the disclaimer fails to meet regulations that require disclaimers to meet specific requirements for type size and boldness and they must be placed on the solicitation where it will catch the reader�s eye.
In one Postal Inspection Service investigation, con artists fraudulently opened boxes at commercial mail receiving agencies (CMRAs) located across the country and mailed bogus invoices for toner to businesses nationwide. Payments were directed to the CMRA boxes and later forwarded to unknown destinations. Finally, some businesses scammed by the con artists indicated they never ordered the subject supplies and refused to pay for them. Instead, victims reported the incidents to the Postal Inspection Service for review and appropriate attention.
Other toner fraud schemes may be classified as telemarketing schemes. In those instances, suspects often establish a telephone �boiler room,� wherein callers contact customers nationwide and represent themselves as a customer�s regular supplier. The caller might then falsely represent that there was a price increase for the product and suggest a timely order. At other times, the caller may allege that a customer�s �order� actually consisted of multiple shipments and advise the customer that he or she was required to accept and pay for all additional shipments. The products, if any, supplied by fraudulent telemarketers may be priced several times higher than comparable items.
The Postal Inspection Service advises businesses to protect themselves from office supply schemes by doing the following:
� Requiring all requests for information about the business be made in writing,
� Training employees to refuse to purchase supplies from unknown office supply companies without first verifying the reliability of the company,
� Instituting strict accounting controls so that the handling of invoices is centralized and authorizations closely reviewed,
� Alerting all employees to office supply scams,
� Watching out for calls asking for verification of the office manager�s name or any other employee likely to purchase office supplies.
The Yellow Pages Scheme
The Postal Inspection Service also cautions businesses to watch out for invoices for yellow pages advertisements designed to look like they are from local telephone directory publishers. The invoices are almost always bogus. Invoices may bear the �walking fingers� logo and the yellow pages name. It should be noted that neither the name nor logo is protected by federal copyright or trademark registration. Additionally, most misleading invoices include disclaimers required by postal regulations to distinguish the solicitation from an invoice. However, recipients who do not read the fine print may be misled by the names of the soliciting companies, which can resemble those of well-known business directory distributors and by the familiar logo. Misleading invoices may be stamped �renewal� or �amount due� and may warn that businesses failing to pay promptly will be left out of the next telephone directory. It is important for businesses receiving invoices for a yellow pages listing to scrutinize them carefully. With few exceptions, charges for legitimate directory listings are included in advertisers� monthly phone bills, not billed separately.
While continuing the emphasis on halting traditional mail fraud schemes, the Postal Inspection Service is also a leader in addressing fraud on the Internet, which affects everyone � you and your customers.
The Internet is no longer a new frontier for fraud but a battleground where war is being waged by those who want to use it for their own illegal ends and those in the criminal justice system fighting to keep it crime-free for consumers. The Internet is swarming with schemes and the Postal Inspection Service along with other law enforcement and regulatory agencies are working to meet the challenge.
It�s easy to see the potential for conducting fraud over the Internet. Fraud schemes on the Internet can be simple or complex, and scams that have long depended on the US mail, such as office supply, investment, get-rich-quick and work-at-home schemes � the same schemes that have always been around � have moved online as well.
Identity Theft
Identity theft and credit card fraud schemes have also found their way to the Internet. Identity theft is the fastest growing financial crime in the country, so it only makes sense that cyberscammers have gotten into the act.
In one case, scammers obtained victims� e-mail addresses through chat rooms. Subsequently, using official-looking AOL letterhead, the suspects sent e-mail messages to victims indicating there was a problem with the credit card account used to pay for supposed services. Victims were directed to click to a link in order to correct the problem. The link led victims to a questionnaire requesting personal information such as name, address, credit card number, expiration date and mother�s maiden name.
Armed with victims� personal information, the suspects contacted the banks that issued the credit cards to obtain balance information. If a substantial credit balance was available on victims� cards, the suspects would ask the bank to change the address on the account to one under their control. The addresses were commercial mail receiving agencies, often referred to as �mail drops.� To further the scheme, Web sites that make templates available for various state drivers� licenses were utilized by the suspects to make phony licenses, which were used as identification to open boxes at the mail drops. Subsequently, suspects used the legitimate credit card accounts to place fraudulent orders for merchandise to be shipped to the mail drops for personal use. The scheme was shut down through the joint efforts of the Postal Inspection Service and the Baltimore Police Department but not before victims of the scheme � credit card account holders, credit card companies and companies from which merchandise was purchased � lost thousands of dollars.
Protecting Yourself and Your Business
Postal Inspectors advise consumers to take the following steps to protect themselves from identity theft and credit card fraud schemes. Businesses should share this information with customers for mail safety.
1. Retrieve mail as soon after delivery as possible or have a trusted friend do so.
2. Outgoing mail should be given directly to a postal carrier or placed in a collection box or hand-carried directly to a post office for mailing.
3. Report suspicious activity to the local police or Postal Inspectors, including someone following the letter carrier, attempting to break into a postal vehicle or tampering with others� mail.
4. Report non-receipt of valuable mail right away by calling the bank, credit card issuers and the Postal Inspection Service.
5. Sign credit cards as soon as they are received.
6. Keep a record of account numbers, their expiration dates and the phone number and address of each company in a secure place.
7. Be careful when disposing of credit card receipts, �pre-approved� credit card solicitations received in the mail and other mail containing personal information. Thieves have been known to go through individuals� trash looking for such information.
8. If you are a victim of fraud, call your credit card issuers immediately to close or flag your accounts and call your bank to put an alert on your checking accounts. Additionally, report credit card fraud to the three major credit reporting bureaus: Experian (888-397-3742), Equifax (800-525-6285) and TransUnion (800-680-7289).
Educated consumers have learned to be leery of door-to-door salespeople trying to sell them the moon. Postal Inspectors have taught consumers to be equally suspicious of telephone or mailed-in offers that were �too good to be true.� Now, in addition to traditional schemes, the American public is vulnerable to fraud on the Internet.
The Postal Inspection Service is committed to putting Internet outlaws behind bars and educating consumers about how to avoid fraudulent scams. Only by the rigorous investigation and prosecution of cyberscammers, along with publicizing this problem and partnerships with the business community, will the Internet be a safe and secure pathway to the limitless future that it should be.
�If it sounds too good to be true � even if it�s on the Internet - it probably is!�
Dawn Nead is information specialist, Congressional & Public Affairs. For additional detailed information about the U.S. Postal Inspection Service, you may visitwww.usps.com/postalinspectors.
