My firm provides mailing training and consulting and we represent clients who have had some dealings with the Postal Inspectors from the U. S. Postal Service Office of the Inspector General (OIG). We are well versed in the details of what they have experienced with postal inspectors and what is discussed in this article is a common thread. It has happened to more than one. These companies are very, very large First-class Permit Imprint mailers. According to the OIG, "The Postal Service derives much of its revenue---nearly 50 percent---from Permit Imprint mail." These folks are following postal regulations and are sending their invoices or statements, etc. as First class mail. And, being very large mailers---mailing millions per year or per month, they also want to take every step they possibly can to claim maximized postal discounts. Move update has applied to them since 1997.

All of these companies have a vested interest in making sure they have the absolute most current address data on file for their customers. They are sending their customers invoices and need to be paid for services rendered. For decades, they have had in place extraordinarily detailed and extensive processes to assure they have the most current move/address information for their customers. For all these years they have assumed they have been move update compliant by anyone's standards simply because of the hundreds of thousands or millions of dollars they have spent in making sure they have call centers place; processing departments to handle any mail that is returned to them as part of mailing at First class rates. It gets returned and new address information is quickly and efficiently processed using procedures that are continually monitored and refined.

In their minds, there has never been a question that they have been attempting to defraud the Postal Service or claim discounts they are not entitled to claim because address quality issues (not just postage) have always been a major line item on their financial statements.

These very large mailers have been under the impression that they have been doing a very good job and not because they believe themselves to be legends in their own minds. Since they began mailing, their local Post Office, and I don't care what city you are in, the message is the same, they hear from their local Post Offices about what a great customer they are of the United States Postal Service---what a great partner they are! They hear this numerous times throughout the year from all of their local postal officials. Their BMEU acceptance folks, even if they have plant loads; in-house postal people or they are dealing with outside mailing service providers---they are continually receiving this praise for the quality of their mail. There are even instances where the clerks who are processing their mail through MERLIN flat out say to them in emails --- your mail is so great, we no longer even scan it because we never have any issues with your barcodes. We never have any issues with print quality. You have great mail!

It is understandable that these large companies would have no idea there is anything wrong with their mail. And then they get a phone call from a Postal Inspector who is requesting a meeting and that Postal Inspector shows up and says "show me on your mailing statement which move update methods you are currently utilizing." The mailer is using a service provider and is unsure of what is being marked by their mailing agent on the statements. But surely, there cannot be a problem. They have been using the same in-house method for many years and they had no idea they had problems with the mail. Upon further investigation, the mailer determines that no USPS approved move update method is being used. The Postal Inspector goes back and says well there are these four methods and a 99% accuracy test. And the customer says, "we will submit the files for 99% accuracy". And the Inspector will say "well no, you would have had to do that before the fact." As far as the Postal Inspector is concerned the mailer has broken a rule. "Technically you have not been in compliance and listen Mr. Mailer, if I go back a period of years, since this regulation has been in place since 1997, technically I could go back and take away every postage discount you have claimed over the last twelve years. I could recover around $80 million but we will settle for just $2.5 million. We are going to settle for this reduced amount and unless you pay this amount, we are going to rescind your mailing privileges."

Now the highly praised mailer is between a rock and a hard place---to say nothing of being shell-shocked, blindsided, betrayed, surprised and embarrassed. They turn things over to their in house legal counsel. They even hire outside legal counsel, to give them expert advice on postal issues and they bring in consultants and at the end of the day the legal people say, "technically, we are noncompliant. We have no choice---we have got to pay. We have got to write this check."

The check gets written and the mailer's upper management immediately insists that the company moves forward to perform a GAP analysis on their compliance procedures and put steps in place to do whatever we need to do to be move update compliant and to assure we get out of the cross hairs of the Postal Inspector. Regardless of how effective our in-house systems and our processes are we have got to find a way to be USPS move update compliant and not allow this to happen again.

One of the most unfortunate, regrettable, but understandable, aspects of this process is that upper management also insists that, not only are we going to get move update compliant but we are also going to put in place a plan to migrate from hard copy mail as soon as we possibly can because we cannot afford to have this happen again.

These companies do not want to go public with the penalties they have been assessed. A number of these companies are publicly traded, have share holders and certainly do not want to be seen as breaking rules of any kind. They have incredibly good processes in place, but their process is not one of the processes that the Postal Service mandates they utilize to update addresses.

So, in the past couple of years, these companies have begun the process of updating their mailing lists using the methods mandated by the USPS. Question: are their address lists better after the move update compliance efforts or worse?

Worse and here is why. There are multiple errors in the United States Postal Service's move update processes. The mailers have attempted to use multiple methods including ancillary service endorsements, Address Change Service, FASTforward and NCOALink. When using Address Change Service, a mailer actually gets mailpiece scans back. You get a scan of your original mail piece if there is a move on file; and then the Postal Service will charge you 50 cents to provide you back the old and new address information. This information should be utilized to correct your database. The mailers now have many samples in house that they can show where the original address that they had on the original mail piece going out the door; came back with a fee charged and indicating a new address that the Postal Service says they need to use to update their database. The "New" info is the actual address they had on the original mail piece going out the door in the first place. They were dinged 50 cents to get back their own, correct information. What are you suppose to do when the address they are getting back was the address they had in the first place but because of anomalies in the Postal Services database or how they are reading them, the address was identified as an error and a fee was charged?

The mailer gets caught in a vicious cycle and really struggle with these issues because they put their hands on these pieces daily. As they get them back they are trying to work them and correct them. They flag and remove the problem records from the automation stream and pay full postage on these pieces until the record can be resolved. They want to utilize the information they are getting back because they paid for it----and they want to be compliant. But, in many instances, because of the shear volume they are dealing with that contains contradicting information, they are not seeing it as a good alternative to the process they already had in place.

NCOALink --- we all know that there are huge problems with the move database and the problems are getting bigger because of the number of people who are not participating. Look at the economy and house foreclosures----people are not filling in change of address cards when they are trying to move away from their creditors. Or, if they are filing them, they are using false information in an attempt to deflect the collectors. The Postal Service is now beginning to see additional problems because they allow people to do change of address online. There are significant problems with online because there are people who misuse the process by filing multiple online change of address for friends or enemies or whatever. The way that data is collected and the way the content of that move database is developed appears, to many in the industry, to actual be degrading rather than getting better.

Another process large mailers are utilizing is FASTforward. Mailers identify mail that has a potential of not being the most current and they will pull them from claiming the maximum automation discounts. They will send those mailpieces over to a presort bureau which will run them through the FASTforward system. This process will apply a more current move than what they already have in their database, if a newer address is on file. They will also be co-mingled with other First Class mail to claim presort discounts. The OCR technology that is built into these pieces of equipment is very similar, if not the same technology that is built into the PARS and other MLOCR machines inside the USPS. There are anomalies in the algorithms used. When they look up an address, they can misread it and may apply a move to a name and address that they shouldn't have. FASTforward will spray on the new (incorrect) address information to the bottom of the mail piece and it will get forwarded to the new (incorrect) address.

Here lies the bigger problem..FASTforward Move Update Notification (FFMUN) became effective in September 2009. Essentially, FFMUN is the Postal Service saying, "FASTforward service providers----you now have to develop a method where you are going to facilitate providing this new move information back directly or indirectly to your client electronically." As a result, if this information that is being sprayed on by FASTforward is a misread by the OCR's---- that new (incorrect) information is being sent back to the mailer. He is electronically changing a record from what was correct to now an incorrect address because of the misread in the OCR. Now the mailer begins the vicious cycle again. A good address started out perfectly good and ended up as a bad address applied to the mailpiece. And, not only was it applied and forwarded into the mailstream but now this information is being sent back as a perceived requirement and now the mailer is electronically updating his files and turning a good address into a bad address.

Most, if not all, business mailers who are subject to Move Update compliance certainly want to have good, current addresses in their databases. They want to be able to utilize the methods that the United States Postal Service is making available to them, however, there are problems with them and those problems should be identified. Clearly, because of these process problems, the USPS should not be assessing penalties like those that are proposed to be assessed come January 4, 2010. The technology used in the assessing of penalties is still not a tight enough process to merit assessment of penalties because some of the problems are actually being caused by the technology itself. I am all for cleaning up addresses but I certainly I don't think it is correct that people be assessed penalties for incorrect addresses when they are being forced to utilize programs that are riddled with problems.

So, one might ask, if these business mailers had such extraordinarily clean data, why were they visited by the Postal Inspectors in late 2008 and early 2009? With visits resulting in very large checks being written. How were these highly praised postal partners suddenly targeted for an audit 12 years into move update compliance? What action brought these valued, long time mailing customers into the crosshairs of the Office of the Inspector General?

Many in the industry, including me, are of the opinion that these mailers are being targeted because of their use of the Intelligent Mail barcode. There is a mailer ID embedded in the IMB and many have suspected that the USPS was using that mailer identification for purposes other than the advertised effort to increase mail delivery efficiencies. According to the Semiannual Report on the Audit, Investigative, and Security Activities of the United States Postal Service Excerpts from page 16: "Revenue Protection Working directly with Postal Service personnel in various functional areas, Postal Inspectors increasingly are identifying postal revenue losses by using data-mining software and taking advantage of ongoing software enhancements of revenue-fraud detection systems."

"The Postal Service derives much of its revenue - nearly 50 percent - from Permit Imprint mail. This type of mail class represents one of the agency's most vulnerable areas of revenue risk. Working with staff from Intelligent Mail and Address Quality, Postal Inspectors are developing software enhancements to help them more quickly and easily identify revenue losses from schemes involving Permit Imprint mail."

These major mailers are not involved in a "scheme" to defraud the Postal Service in any way shape or form. They simply have been following all of the hype from the Postal Service and have begun to implement the Intelligent Mail barcode because they are trying to be good "postal partners". Yet, at this point in time, it appears the only thing the Postal Service is utilizing that Intelligent Mail barcode for is to bring big mailers to the attention of Postal Inspectors.

Also, there is no consistency or transparency of enforcement of revenue deficiency assessments. Where does that money go and where is it accounted for? Why doesn't the Postal Service ever show in black and white how much money was collected for Move Update noncompliance? But it is not reflected anywhere and it would be a big help if people could see the accounting. But this is just a check that is written and it's gone----leaving the industry to be suspicious of the process.

Now, some of the biggest mailers are very quietly going to find a way to communicate with their customers without utilizing the United States Postal Service. It is unfortunate. It really shouldn't be happening. This is not something they had planned on doing. But, now that the Postal Inspectors have shown up and they are now being forced to utilize processes, which they have proof are inferior to the process they already had in place--- they paid up but now they are going to move forward and move away from mail.

Postal Inspectors collect $2 million from a large Permit Imprint "postal partner" for Move Update noncompliance and, in doing so, put in motion the process to ultimately lose a customer worth $20 or $30 million annually. Sounds like a deal only the Postal Service could make.

Mary Ann Bennett is President/CEO of The Bennett Group, Inc., a mailing training and consulting firm and is founder of the Mailing Training Institute located in Rochester, NY. She can be reached at PH: 585-424-2702 Email: Web: