OIG - postalnews blog


OIG: USPS doesn’t even know how many historic properties it owns

Screenshot 2014-04-22 at 7.05.53 AMThe US Postal Service’s Inspector General has released a report criticizing the way the USPS cares for the historic buildings and works of art it is responsible for. The OIG report comes on the heels of another critical assessment of USPS practices by the Advisory Council on Historic Preservation last week. Here’s the OIG’s summary of its findings:


The Postal Service did not know how many historic properties it owned or what it cost to preserve them, as required by the National Historic Preservation Act. It did not report the status of historic artwork to the National Museum of American Art, as required by Postal Service Handbook RE-6, Facilities and Environmental Guide, when it sold 10 historic post offices.

The Postal Service did not collaborate with the Advisory Council on Historic Preservation to improve its compliance with the National Historic Preservation Act and did not submit its 2011 status report to the council. The council could help the Postal Service establish covenants to protect historic features and help secure covenant holders to monitor compliance with those covenants. Also, the council could help review public requests to participate in the preservation process. The Postal Service could also use the U.S. General Services Administration — which employs experienced real estate and historical preservation professionals — to assist in the preservation process.

The vice president, Facilities, who approves funding for the relocation of retail services and disposal, also issues the final determination letter after reviewing appeals raised during the process. This gives the appearance of bias. Three of the nine relocations were
appealed and he denied all three appeals.

The Postal Service appropriately applied relocation procedures rather than discontinuance procedures for all
nine properties we reviewed. However, officials did not post the public meeting notification 7 days in advance for one property, as required, and could not show documentation that it met the relocation requirements for two properties.

Read the full report (.pdf file).

The Washington Examiner’s phony travel card story

The Washington Examiner, the right wing web site that pretends to be a newspaper, has what it apparently thinks is a big scoop this morning:

Postal employees have spent thousands of taxpayer dollars on gambling, bills and other personal expenses, according to a series of reports by the U.S. Postal Service inspector general.

Shocking, isn’t it? Just one problem- it’s not true. In the first place, of course, most people know by now that the USPS isn’t funded by the taxpayer. But the most important fact that the Examiner chooses to ignore is that government travel cards are credit cards issued to employees who travel on postal business. While the cards are intended to be used solely for official travel expenses, the individual employee is responsible for all charges made on the card.

So if some stupid manager uses his travel card to get a cash advance at a casino so he can gamble, (as has been done), it is accurate to say that

  • he is certifiably stupid
  • he has violated USPS regulations and federal law, and…
  • he should be fired

But it is totally false to say that he has cost the taxpayer, or even the postal ratepayer, any money. That cash advance will appear on his next statement, and Citibank will expect repayment, regardless of whether the advance was made legitimately or not. The USPS isn’t out a single penny.

The Examiner story pretends to be an investigative story, painstakingly crafted from the results of Freedom of Information Act requests, but all of the information it “reveals” is, and always has been, freely available on the OIG website. Had the authors read the reports more carefully, they might have noticed this:

The Postal Service provides individual government travel cards to designated employees for use while on official travel. Employees are responsible for all charges and automated teller machine (ATM) withdrawals.

“Employees”. Not “the taxpayer”, “the ratepayer”, or the USPS. So much for the Examiner’s shocking expose!

If all of this sounds vaguely familiar, it’s because the Washington Post ran a similarly misleading story in 2011. To its credit, the Post corrected most of the errors in that story after we pointed them out. I wouldn’t hold my breath waiting for the Examiner to do the same.

Read more: Postal service employees use travel cards to gamble, pay bills and go bowling | WashingtonExaminer.com.

IG says USPS should consider locality based pay

From a white paper recently published by the USPS Office of Inspector General:

uspsoigThe ongoing debate about the comparability of postal employee wages to their counterparts in the private sector has rarely included discussion of one key element of the U.S. Postal Service’s wage structure. Private sector companies commonly pay employees based on the local cost-of-living and labor market conditions. As a result, it is well understood that someone working in Manhattan, New York will earn more than someone with an identical job in Manhattan, Kansas. The federal government recognizes this notion through well-established locality pay systems for both its white-collar and blue-collar workers. In fact, the federal government was already recognizing the importance and necessity of offering wages based on local conditions at least as early as the Civil War. Read the rest of this entry »

OIG says USPS failed to recover almost $10 million in Voyager card overpayments

uspsoigThe USPS Office of the Inspector general has issued a Management Alert concerning overpayments to trucking contractors. The USPS issues “Voyager” credit cards to HCR contractors for the purchase of fuel. As part of the reconciliation process, the USPS is supposed to recover any charges above those provided for in the HCR contracts.

The OIG had this to say about the process:

We estimate that the Postal Service did not properly identify and recover about $9.9 million in fuel overpayments to HCR suppliers for fuel year 2009-2010. It failed to collect these overpayments because the HCR Voyager Card Program reconciliation process was not reasonably conducted and documented.

Read the full report: Voyager Card Program for Highway Contract Routes – Unidentified and Unrecovered Fuel Overpayments | Office of Inspector General.

OIG: USPS spent $1.3 billion in non-competitive purchases

A new Inspector General’s audit says the US Postal Service spent $1.3 billion on non-competitive purchases in FY 2011 and 2012- and more than a third of those purchases lacked the required documentation to insure that the purchases were properly made:

uspsoigContracting officials did not provide documentation to support price or cost reasonableness and justifications to award noncompetitive purchases for 21 of 56 purchases (or 38 percent of purchases) valued at $37,064,806. Specifically, they did not conduct price or cost analysis or maintain documentation to support the reasonableness of 13 purchases. In addition, they did not fully complete the noncompetitive justification for awarding 10 purchases, two of which were also missing documentation to support price reasonableness. Further, contracting officials did not always obtain required contract documents from international suppliers due to cultural and language barriers.

Based on our statistical sample, we projected that at least $210 million of the $1.3 billion in purchases made during fiscal years (FY) 2011 and 2012 did not contain documentation to support price or cost reasonableness and justifications to award noncompetitive purchases. This amount was claimed as unsupported questioned costs because of missing or incomplete documentation or failure to follow policy or required procedures but does not necessarily indicate that the Postal Service incurred actual loss.

Noncompetitive Purchasing Practices Audit Report .

Two South Carolina postal workers indicted for delay of mail

uspsoigThe US Attorney’s Office in Columbia South Carolina announced today that two Anderson SC postal workers have been indicted for delay of mail. Linda M. Hughes, age 40, of Liberty, and Kevin William Pearson, age 30, of Anderson, were each charged with a single count. According to the Greenville News, the indictment claims the two “unlawfully destroyed, detained, delayed or opened mail that was intended to be delivered by a Postal Service employee”.

The maximum penalty each could receive is five years imprisonment for violating Title 18, United States Code, Section 1703. The cases were investigated by agents of the United States Postal Service, O.I.G., and were assigned to Assistant United States Attorney David C. Stephens of the Greenville office for prosecution.

OIG ‘Special Agents’ Don’t Have Special Rights

(This article first appeared in the March/April 2013 edition of The American Postal Worker.)

In a recent decision, the Employees Compensation Appeals Board (ECAB) ruled that the Office of Workers’ Compensation Programs (OWCP) acted improperly when it terminated the benefits of an injured worker based on evidence that was impermissibly obtained (F.S., Appellant; Docket 11-863; Issued 9/26/2012).

The ECAB concluded that special agents of the USPS Office of the Inspector General (OIG) violated several federal regulations in a fraud investigation involving the claimant — an all-too-common practice. In its ruling, ECAB admonished OWCP for departing from its obligations, stating vehemently that evidence created outside applicable regulations should be rejected. Read the rest of this entry »

Tennessee postal worker printed $32K in money orders to pay for drug habit


KNOXVILLE, Tenn. – Sean Thomas Dennis, 29, formerly of La Follette, Tenn., pleaded guilty on Jan. 18, 2013, in the U.S. District Court for the Eastern District of Tennessee at Knoxville, to an indictment charging him with fraudulently issuing U.S. Postal Money Orders. Sentencing has been set for 10:30 a.m., Apr. 8, 2013, before the Honorable Thomas W. Phillips, U.S. District Judge.

In conjunction with his guilty plea, Dennis, a former U.S. Postal Service employee, admitted to issuing money orders without having first receiving or paying the full amount required for their issuance. Between October 2010 through January 2011, Dennis embezzled $32,096.21 from the U.S. Postal Service by fraudulently issuing 43 money orders. He told federal investigators that committed these acts to obtain money to finance his drug addiction.

This conviction was the result of an investigation by the United States Postal Service, Office of Inspector General. Assistant U.S. Attorney Frank M. Dale, Jr. represented the United States.

USDOJ: US Attorney's Office – Eastern District of Tennessee.

OIG criticizes USPS advertising oversight, alleges “misuse of position”, “questionable bonuses”

uspsoigThe postal service’s Inspector General has released a report calling on the agency to do a better job managing its advertising budget. The report also accuses an unnamed USPS official of “misuse of position” for leaking a draft of the report to the service’s outside advertising contractor.

According to the OIG:

The Postal Service was not adequately monitoring its two largest advertising contracts, which threatened the
effectiveness and integrity of its advertising program. Specifically, the Postal Service:

  • Did not clearly define or understand the roles and responsibilities of the primary team members for its major
    advertising contractors, who were paid $10 million in fiscal year 2011.
  • Paid $631,712 in questionable bonuses to these two contractors in fiscal years 2011 and 2012.
  • Did not sufficiently track or allocate certain advertising costs.
  • Did not comply with internal controls for certifying and retaining advertising invoices.

The OIG also says it found “abuse of position” by an unnamed USPS official. The identity of the official as well as the specifics of the abuse are blacked out, but the report goes on to state: “We also found that the contents of our informal draft report were improperly released to officials outside of the Postal Service who were connected to the major contractor.”

In all, the OIG found about $7 million in “questioned” costs: “We are reporting $2.3 million in improperly certified invoices, $4 million in non-core labor costs, and the performance bonuses of $631,712 as questioned costs.”

OIG: Mystery Shopper Program was compromised

The USPS Inspector General has released a report finding that the postal service’s Mystery Shop program was compromised by the public posting of mystery shop schedules and scenarios, and by the ability of current USPS employees to enroll as shoppers: Read the rest of this entry »