Mail fraud and check theft are back. Well, I suppose they never left, but they’re certainly back in the news again, costing Americans tens of thousands of dollars, and grabbing the attention of the Independent Community Bankers Association (ICBA).
The association has addressed the problem recently via a “Frauds and Scams” page on its website. There, it posted a “statement for the record” for a Senate Banking Committee hearing on fraud and scams because, “community banks and their customers continue to be challenged by a rise in fraud and scams across payment types.”
A bit of history. For years, Postal Police Officers (PPOs), were assigned with the responsibility for preventing mail theft and protecting carriers. Back in the early 2000s, the US Postal Inspection Service (USPIS) had decided that having PPOs at facilities wasn’t the best use of resources, and started deploying them on the street; targeting, for instance, zip codes where mailbox theft and carrier assault were prevalent.
The PPOs patrolled high mail-crime areas, staked out mailboxes, and arrested people stealing mail. Then in 2020, the Postal Inspection Service decided that PPOs should no longer work off Postal Service premises and instead, guard only post office properties. This policy change was a break from how the Postal Service had been conducting security for nearly two decades.
According to the USPIS in 2023, there were nearly 1,200 reported cases of serious postal crimes including mail theft and assaults on mail carriers, with roughly half of those cases being robberies of letter carriers; the USPIS also reported around 628 robberies of postal employees in 2023. Note: My guess is that these numbers are unexpectedly low because this type of crime often goes unreported.
A lack of policing is one factor, the sophistication of mail theft is another. Check fraud has been with us for a long time. It has become highly sophisticated in recent years, however, largely thanks to technology. The result is the growth of:
- theft operations on a large, organized scale
- the dark web as a means for selling stolen checks and mailbox keys, and
- the recruitment and training of “walkers” who are paid to deposit or cash washed checks using false identification.
One fact is undeniable, however: “Banks and customers alike,” as the ICBA website warns, “are scrambling to deal with the fraud that frequently happens after mail theft.”
Of course, the USPS Inspection Service has been feeling the heat and has, as a result, taken action. In 2023, the agency launched Project Safe Delivery, a comprehensive initiative aimed at combating the rise in postal crimes, particularly those targeting letter carriers and mail theft. There are two key components to the project:
- High-Security Collection Boxes: Installation of over 10,000 high-security blue collection boxes nationwide to deter unauthorized access.
- Electronic Locks: Replacement of antiquated arrow locks on blue collection boxes with 49,000 electronic locks, incorporating two-factor authentication to improve carrier safety.
The program seems to be bearing some fruit. Since May 2023, the Inspection Service has made 109 arrests for robberies and more than 530 arrests for mail theft. And, through targeted enforcement surges in cities like Chicago and San Francisco, made over 600 arrests related to postal crimes. Then, as recently as this past October, the following advice was posted on the United States Postal Inspection Service website:
- Deposit your outgoing mail in blue collection boxes before the last pickup or at your local Post Office.
- Never leave your mail in your mailbox overnight.
- If you’re going on vacation, have your mail held at the Post Office or have it picked up by a friend or neighbor.
Is this enough? Not according to the ICBA. Here’s how the statement of record closes: “By far the biggest source of stolen checks is the United States Postal Service. Checks are stolen from consumer mailboxes as well as from USPS facilities. Effective mail security is a critical, though not exclusive, part of the solution to the problem of check fraud. With better security, check fraud would be significantly reduced.”
I’m not sure I agree with the USPS being the only problem. After all, what people do with their mail is also a contributing factor. Be that as it may. In the absence of a truly robust effort on the part of the USPS – and behavioral changes on the side of consumers – what can community banks do?
While community banks ”conduct thorough investigations on such incidents … and assist law enforcement to identify and understand specific crimes and trends with the hope of protecting all consumers from similar incidents,” admittedly, says the ICBA, “customer education, whether in person, at branches, or online is a critical component of fraud prevention and mitigation.”
Absolutely. A more secure postal system, along with constant, consistent messaging from banks that focuses on the dangers of check fraud will certainly go a long way in addressing the problem. In fact, a postal system that functions even marginally well would be a vast improvement. Not to make this personal or anything, but over the course of the last three years, every time I've gone on vacation, I've gone to the local post office and filled out the "hold mail" paperwork. I’ve even resorted to putting a note in the mailbox and even tied it shut. And yet, when I've come home, the mailbox is full and overflowing onto the ground. If the postal service worked for me – and I guess, well, technically it does – I’d fire it in a heartbeat. So, unfortunately, we cannot rely on the USPS to step up and get it right. Instead, it falls on banks and consumers.
Community bank marketers need to get that message out to their customers … and keep it out there. Why would or should a bank customer risk having their personal information stolen or becoming a victim of check fraud when every banking service they could possibly want – from depositing checks, e-statements and transferring funds to paying bills quickly and securely — can be accessed through a community bank’s website or mobile app? Seems pretty simple, and compelling, to me. (It still amazes me how many banks still hand write and mail checks through the postal service. I have to believe that using ACH would be a whole lot easier, safer and cheaper.)
A social media marketing strategy is already a staple of any community bank’s marketing plan. All it takes now is to build in the appropriate “check fraud awareness” messaging. And, we can certainly help with that.
Bank Marketing Center
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We also want to share what we know – and learn along the way – with all our community banking friends. Whether it’s the latest on AI technology, suggestions on how to attract and retain top talent, or the importance of data protection, we’re here to make bank marketing the best that it can be.
Want to learn more about what we can do for your community bank and your marketing efforts? You can start by visiting bankmarketingcenter.com. Then, feel free to contact me directly by phone at 678-528-6688 or via email at nreynolds@bankmarketingcenter.com. As always, I welcome your thoughts.