Inspection Service Home Page NEWS RELEASE
UNITED STATES POSTAL INSPECTION SERVICE

For further information call:
Postal Inspector Paul Krenn: 703-292-3803

May 6, 2005

Setting the Record Straight:
U.S. Postal Money Orders are as Good as Money in the Bank


Washington, DC -- No doubt youíve heard about an increase in the number of counterfeit postal money orders in circulation. What you may not have heard is that many of the claims about the scam are not true.

Chief Postal Inspector Lee R. Heath of the U.S. Postal Inspection Service advises, "A postal money order is one of the safest forms of payment available to American consumers. The scam youíre hearing about is a new version of the old "confidence" scams, but this one involves counterfeit checks, commercial money orders, and postal money orders."

In the latest version of the scam, victims are contacted via the Internet, in a chatroom, or by e-mail. An online predator asks them to cash a check or money order and return the proceeds--less a small portion to keep as payment for goods, services, or as a gift. When the check or money order is returned by the bank as a counterfeit, the consumer is left holding the bag.

Postal Inspector in Charge of Violent Crimes Paul J. Trimbur confirms that the counterfeit issue is not unique to the Postal Service; the attack is on financial institutions as well. Postal Inspectors across the country are recovering large volumes of counterfeit cashierís checks and non-postal money orders. "In West Virginia, Inspectors recovered more than $670,000 in counterfeit checks in addition to $8,000 in postal money orders. In a separate investigation, non-postal money orders and cashierís checks comprised more than half of the dollar value of the items recovered. Clearly, the Postal Service is not alone." says Trimbur.

The U.S. Postal Service issued 188 million postal money orders in the fiscal year ending September 2004, during which approximately 3,700 counterfeit postal money orders were cashed. That works out to about one counterfeit for every 53,000 issued, and losses were calculated at less than $3.7 million.

Compare that to counterfeit check fraud, which far exceeds the billion-dollar mark each year, and currency issued by the U.S. Treasury--for which the U.S. Secret Service claims a rate of approximately one counterfeit bill for every 10,000 bills in circulation.

"The counterfeit checks and money orders weíre seizing are very good reproductions. However, not a single counterfeit postal money has replicated the security features of a genuine postal money order--which displays Ben Franklinís image in a watermark when held to the light and a dark security thread with "USPS" running from top to bottom," states Inspector Paul J. Krenn, National Public Information Officer for the Postal Inspection Service.

"The security features are easy to spot. You see them when you hold the postal money order up to the light. If the images arenít clear, donít take a chance--take it to a Post Office or notify a Postal Inspector," advises Krenn.

"We continue to fight this fraud thatís hitting consumers and businesses on a number of fronts," advises Chief Heath. "With the cooperation and assistance of our law enforcement partners--especially U.S. Customs and Border Protection, the FBI, and local law enforcement agencies across the country--we can stem this fraud. But just as important to our efforts are educated consumers. Fraud is one of the few crimes in which victims can decline to participate--if they recognize the warning signs."

For more information on this and other confidence scams, visit the U.S. Postal Inspection Service Web site at www.usps.com/postalinspectors.



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