Postage stamps, records manipulation, and a clandestine call to report suspicions. It has the makings of a good series to binge watch on a rainy weekend.
Instead, it’s a recent audit report on improving the controls around stamp stock at postal retail outlets. And it started with a call to our Hotline to report suspicious transactions involving stolen stamps from a Louisiana postal station.
Our initial investigation confirmed that a U.S. Postal Service manager with access to postage stamp inventory was selling unit reserve stock – stamp-related and philatelic products that had not been assigned to areas within the unit – on eBay at reduced prices. We discovered the unit’s stock reserve was abnormally large for an operation of its size. The manager’s position allowed him to circumvent controls and manipulate data records to avoid detection. As a result, he sold postage stamps valued at more than $636,000 and pocketed the cash. (He was caught, sentenced to prison, and ordered to repay all he stole.)
The case prompted our audit on USPS controls designed to address unit reserve stamp stock accountability for all 35,000 postal retail units. We found the controls were not always adequate or used effectively. Management did not thoroughly monitor and manage units with excess or excludable stamp stock. (Excess stock is stamps greater than the unit’s authorized limit, and excludable means Christmas, philatelic, or redeemed stock.)
We also found management didn’t review orders that exceeded authorized stock limits as required or monitor units that place more than the maximum-allowed three stock orders a month. USPS agreed with our recommendations focused on tightening existing controls and instituting new ones, such as requiring approval for stamp stock orders that exceed authorized dollar and number limits and requiring witnesses to verify stock shipments.
Do you have other ideas for improving stamp stock accountability? Are you familiar with our Hotline? If not, more information can be found here.