Are they? Entrusting their personal information – banking information, such as checking account numbers, for instance – to the United States Postal Service? Probably not a good idea. And if they are, you better get the message out that this is a dangerous practice.
As if community banks needed another reason to encourage customers to “go digital,” i.e., use their online/mobile app bill pay and e-statements, here is yet another one. Mail theft. And if ever there was a time to be concerned about it, this is it.
Mail theft continues to be a tremendous problem for consumers, and community banks. As you well know, over the course of – I think it’s been about a year now – there has also been no end to the craziness at the USPS, a branch of the federal government that was once hailed as one of our most respected of all federal agencies. Despite the craziness and criticism of this once-storied institution, as far as I can tell, believe it or not, the idea of “postal banking” is still kicking around.
It was back in March of 2022, that it was announced that “the U.S. Postal Service is getting back into financial services, something it hasn’t offered for 55 years. The new services will start off small. For a flat fee of $5.95, customers in Washington, D.C., Falls Church, Virginia, and the Bronx, New York, can cash payroll or business checks (up to $500) on to a debit card. If all goes well, the Postal Service says customers could eventually pay bills, deposit and withdraw cash, and send money to other post offices.”1 And, I’ve not seen an update on that since. Unfortunately, I think the USPS still isn’t ready to provide banking services. In fact, the Postal Service still seems unable to perform even the most basic of services; that being the safe, timely, and efficient delivery of mail. Just a thought: Perhaps they should give up providing postal services and offer banking services only. They might have more success simply supplying customers with money orders…
To be fair, it’s not entirely the Postal Service’s fault. Fraudulent activity is at an all-time high, especially as it concerns the financial services industry and yes, an ever-increasing amount of that activity is mail related. Here are just a few rather disturbing statistics. According to:
- USA Today,2 mail thefts have been linked to stolen checks across the nation, with the average amount of a stolen check at $2,430.
- The US Postal Inspection Service (USPIS), mail carrier robberies in 2024 are up by 73% from the previous fiscal year
- Troy Group research, “17 billion checks are exchanged each year in the US, and criminals are exploiting weaknesses in the mail system to intercept checks, alter their details, and cash them fraudulently. This not only leads to financial losses but also erodes trust in the integrity of the banking system.”3
- The United States Postal Inspection Service website, almost 2.8 million people filed a fraud complaint in 2024.
And bad actors are getting smarter every day, using more sophisticated techniques and technologies that are exacerbating the problem. Have you ever sent a check that was cashed, but the recipient said it never arrived? You may be the victim of check washing and this goes way beyond anything you may have learned in that high school chemistry class. Check washing scams involve changing the payee names and often the dollar amounts on checks and fraudulently depositing them. How is it done? Checks are stolen from mailboxes and washed in chemicals to remove the ink. Postal Inspectors recover more than $1 billion in counterfeit checks and money orders every year.”4
Now, the USPS offers this guidance: If you happen to see someone who does not look like a postal worker with both arms stuck in your mailbox (I’m kidding about this part) that you should report it to your local police or call postal inspectors at 877-876-2455. Good advice.
What “advice” should community banks offer? I think community bankers need to make use of their social media platforms and get this message out to their customers: Forget the mail and go digital. Why should your customers risk having their Personally Identifiable Information stolen or becoming a victim of check washing when every banking service they could possibly want – from depositing checks and transferring funds to paying bills quickly and securely — can be accessed through your website or via your mobile app? Seems pretty simple, and compelling, to me. As always, I welcome your thoughts.
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1AARP. Postal service gets into banking again. March 22, 2022.
2USA Today. Criminals target mailboxes to commit financial crimes, officials say. What to know. February 23, 2024.
3The Troy Group. Mail theft in 2024. March 13, 2024.
4United States Postal Inspection Service. Check Washing. October 13, 2023.