Postal Inspectors

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Postal Inspectors

• For over 200 years, U.S. Postal Inspectors have
  been tracking down nearly every kind of criminal
  imaginable bombers, murderers, blackmailers and
  extortioners, drug and gun runners, child
  pornographers, con artists, post office and bank
  holdup men, train and even stagecoach robbers!

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In the movies, Butch Cassidy and the Sundance
Kid

• Who are those guys?

• the Sundance Kid

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• Those guys, who relentlessly followed Butch
  Cassidy and Sundance, were none other than
  

Postal Inspectors!
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The Postal Inspection Service

• The rights of the people to be secured in their
  papers against unreasonable searches and seizures
  is guaranteed by the Fourth Amendment of the
  United States Constitution. The concerns of the
  Postal Service for these individuals
  constitutionally-guaranteed inviolability of his
  personal papers, when entrusted to the Mails, is
  embodied in the concept of the sanctity of the
  seal.

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It is the Inspection Services responsibility to
protect the reliability and security of the U.S.
Postal Service.

• We exist to ensure the publics confidence in the
  U.S. Mails remains strong.

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The Task Force

• The Joint Industry Rebate Fraud Task Force was
  formed in 1993, in response to manufacturers
  reporting to the U.S. Postal Inspection Service
  that thousands of individuals were defrauding the
  Promotion Industry by fraudulently submitting
  mail-in offers.

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Losses were estimated at 500 million dollars
annually!
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• Together, the Postal Inspection Service and the
  Promotional Industry formed a partnership, Rebate
  Fraud Task Force, to examine the causes for the
  rise in rebate fraud and to take the appropriate
  measures to reverse the trend.

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Mission Statement

• Reduce mail-in offer fraud in significant terms.

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Goals

• Create and maintain industry guidelines governing
  mail-in offer development and fraud controls.
• Obtain compliance with guidelines from the
  broadest sector of the Promotion Industry.

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Goals

• Identify and take appropriate action against
  consumers using the mails to defraud.
• Through education, increase awareness of the
  mail-in fraud problem within all facets of the
  Postal Service and the Promotion Industry.

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Action Step

• Create working partnerships between the Promotion
  Industry and the Postal Inspection Service to
  reduce mail-in offer fraud in significant terms.

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Pillars of the Rebate Fraud Initiative have been
prevention, education and prosecution.

• Prevention

• Education

• Prosecution

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Conclusions

• Lack of industry standardization.
• Improper data management.

• Inadequate attention by the law enforcement
  community.

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Solutions

• Create and maintain industry guidelines governing
  mail-in offer development to address... the lack
  of industry standardization.
• Develop a system for identifying and taking the
  appropriate action against consumers using the
  mails to defraud to address... the problem of
  improper data management.
• Utilize the Civil Fraud Remedy statutes against
  low level offenders involved in rebate fraudto
  address the inadequate attention by the law
  enforcement community.

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Results

• The Promotion Industry Guidelines for Mail-In
  Offers booklet was published and is now available
  industry-wide.

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Results

• The Central File database is now available to
  manufacturers, fulfillment companies and law
  enforcement. It currently contains over 1.9
  million records of suspected fraudulent activity.

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Results

• The Postal Inspection Service has reviewed the
  activities of over 105,000 suspects and taken
  civil action against 7,700.

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Action Plan to Combat Rebate Fraud

• Criminal Prosecution
• Forfeiture

• 3005 Consent Agreements

• 3003 Withholding of Mail

• Voluntary Discontinuance

• Pre/Post Promotion Review using
• Central File Data

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• Statistical Report

• FY94 FY95 FY96 FY97
  FY98 FY99 FY00 FY94-FY00
• Address 325 6,570 5,067 80,285
  6,220 3,880 2,662 105,009
• Inquiries
• Voluntary 1,339 220 3,500 1,709
  630 365 7,763
• Discontinuance
• Letters Issued
• Voluntary 581 63
  1,377 1,224 383 240 3,868
• Discontinuance 43 29 39
  72 61 66 50
• Letters Signed
• 
  Division Referrals
  233

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Chicago Inspection Service Operations Support
Group Rebate Team
Pat Sweeney, ISOSG Manager Karen Abernathy,
Supervisor Cynthia Gills, Team Leader Maria
Scaletta, Technician

• Hotline

Hotline [phone]
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Rebate Team Liaison Role
Coordinate the annual Task Force Meetings with
Promotion Industry Inspection Service Divisions.
Analyze Central File data aggressively pursue
cases that warrant attention through civil and/or
criminal action.
Educate USPS employees on the warning signs of
rebate fraud.
Participate in the Rebate Fraud teleconferences
with the promotional industry.
Create public awareness.
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Today, the initiative is managed by the Rebate
Data Center, Inc. (RDC) and its officers and the
administrative support of the Promotion Marketing
Association (PMA).
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RDC

• Confidence in the Mails
• October 26-27, 2000
• Mike Kennedy Co-Chairs Shirley Ray
• Walgreen Company Lees Mktg. Svcs.
  

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Today...

• Purpose of the RDC
• Evolution of the organization
• Goals-Moving Forward

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Purpose.

• 1.) To identify major offenders who commit fraud
  by using the mail(s) to obtain payment from
  companies who run rebate promotions.

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Purpose...

• 2.) To provide major offender information to
  Law Enforcement for review.Obj. to determine
  what course of action should occur (Civil or
  Criminal)
• 3.) To provide confidence in the mailso the
  mail can continue to be used for future
  promotions

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Evolution...

• Postal Inspection Service took the lead in
  establishing a Rebate Fraud Initiative
• After meeting with Industry leadersThe Rebate
  Fraud Task Force was organized and a steering
  committee was identified
• Objectives were identified
• 1.) Guidelines for rebates was developed,
  written and distributed to the Industry

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Evolution...

• 2.) A Central file was created
• -Purpose To accumulate data that would enable
  Law Enforcement to I.D. the scope of potential
  mail fraud for rebates
• A third party company was required for
  development and day-to-day management of the
  central file

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Evolution...

• Criteria for sending data to the central that was
  acceptable to both Industry and Law Enforcement
  participants was developed
• 3.) PMA hired to be Administrator
• -Provides administrative support
• -Provides legal representation and advise

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Evolution...

• 4.) Membership guidelines were expanded to give
  equal representation to both manufacturers and
  fulfillment vendors.

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Evolution...

• 5.) USPIS began stepping back from the
  leadership role. The Industry accepted leadership
  of the RDC with the understanding that Law
  Enforcement will continue to actively support the
  Organization in identifying and pursuing
  resolution when people are using the mails to
  illegally receive reimbursement for rebate
  promotions.

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Evolution...

• 6.) Structured for Success
• Officers
• Committee Chairs
• Administrative and Legal Assistance
• Central File Maintenance and Management
• Law Enforcement Participation

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RDC Goals

• 1.) Increase membership
• -Provides solid foundation of financial
  support for and new data to the central file
• 2.) Educational programs are being developed
  for the Industry

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RDC Goals

• 3.) Continue to provide the USPIS with the
  assistance required in their pursuit of people
  using the mails to defraud their customers
  .all of us!