OFFICE OF INSPECTOR GENERAL 

Semiannual Report to Congress Semiannual Report to Congress 

Including Significant Activities of the Inspection Service

months, with the support of the Postal Service Governors and the assistance

of the management and employees, we issued over 100 reports representing

over $1.1 billion in savings and potential cost avoidance during the current

and future years. We also performed investigations resulting in $2.1 million

in fines, recoveries, and restitution.

We are extremely proud of these accomplishments and will strive to continually provide high quality work and add value to the United States Postal

Service. In addition to the results you will read about in this report, we have

had many other significant accomplishments over the past six months. Some

of these include:

◆ submitting written testimony regarding sweepstakes mailings to the

House Subcommittee on the Postal Service;

◆ being recognized within the Inspector General community with 12

awards acknowledging our innovation and leadership, including four

Awards of Excellence; and

◆ attending the 22nd Universal Postal Union Congress in Beijing,

China, as a U.S. delegate. 

With all of our recent accomplishments, it is hard to believe that three

years ago we were merely a concept. At that time, Congress recognized that

the American public needed an independent and objective perspective on

Postal Service operations and activities. Since 1997, we have built our organization based on a vision of “A Constellation of Talented People Making a

Difference.” In a recent oversight hearing before the House Subcommittee

on the Postal Service, Chairman John McHugh characterized the Postal

Service Office of Inspector General (OIG) as a “valuable partner” in the

effort to combat fraud, waste, abuse, and mismanagement.

Our successes have been the result of unending and sometimes exhausting hard work, unflinching determination of staff, and the welcome support

and assistance of so many others. As the OIG has evolved, we have moved

through several levels of development: from building our infrastructure, to

learning about the Postal Service, to identifying systemic issues and measuring results. 

This Semiannual Report to Congress details our significant activities

and accomplishments, as well as those of the Inspection Service from April 1

to September 30, 1999. Submission of this report fulfills our reporting

requirements under the Inspector General Act and Inspection Service

requirements under the Mail Order Consumer Protection Act. This also represents a comprehensive reporting of the work of both our office and the

Inspection Service’s efforts to combat fraud, waste, abuse, and mismanagement within the Postal Service.
vice officers informing them that they could not retaliate against employees who re

doing to us. Chief Postal Inspector Kenneth J. Hunter also announced his retirement. 

was invaluable in helping us establish a separate OIG. We also welcomed the new 

Inspector, Kenneth C. Weaver, with whom we share the same goal—to improve Pos

We have agreed to renew the teambuilding started with former Chief Inspector Hu

objective of increasing communications, trust, and coordination between the two or

We have also changed the format of this Semiannual Report to Congress to ma

readers to locate information and to more clearly articulate what we have done and 

headed. We have added a new Customer Service section that explains how the OIG s

its customers, specifically in the areas of Congressional and Governors’ requests, Free

mation Act requests, Hotline operations, Postal management requests for reviews, a

and regulatory reviews. The Inspection Service and our work is now highlighted un

areas: performance; technology; financial management; labor management; oversight 

tion Service; and other significant issues. In addition, we have incorporated relevant 

regulatory reviews into each appropriate section instead of reporting them in a separ

in past reports.

As we enter our fourth year, we believe that the establishment of an indep

Inspector General by Congress in late 1996 has resulted in the:

◆ enhancement of Postal Service economy, efficiency, and integrity;

◆ creation of a truly independent voice; 

◆ development of a venue for all employees and other stakeholders to confident

allegations of fraud, waste, abuse, and mismanagement; and 

◆ delivery of objective information and analyses of Postal Service operations to 

stakeholders, including Congress and the Postal Service Governors.

As the Postal Service reevaluates the role it will play in a highly technological an

competitive environment, we will continue to provide the Postal Service, the Govern

gress with accurate, timely, and objective information. We look forward to continuing 

the Governors, the Postmaster General, and Postal Service management and staff to i

operations. 

Sincerely,

Karla W. Corcoran

Inspector General

October 31, 1999

PAGE2 A MESSAGE FROM THE INSPECTOR GENERAL

Deputy Postmaster General Michael Coughlin

at his retirement in June with Inspector

General Karla W. Corcoran.
PAGE3

Office of Inspector General ........................................................................28

Inspection Service........................................................................................32

OIG GOALS ........................................................................................................33

CUSTOMER SERVICE ............................................................................................35

PERFORMANCE REVIEWS......................................................................................41

Office of Inspector General ........................................................................42

◆ Accepting and Processing ......................................................................42

◆ Transportation..........................................................................................44

◆ Delivery ....................................................................................................45

◆ Marketing ................................................................................................46

◆ Legislative and Regulatory Reviews ......................................................47

Inspection Service........................................................................................50

◆ Accepting and Processing ......................................................................50

◆ Transportation..........................................................................................51

◆ Delivery ....................................................................................................51

◆ Mail Theft ................................................................................................52

FINANCIAL MANAGEMENT REVIEWS ..................................................................53

Office of Inspector General ........................................................................54

◆ Financial Related Reviews ......................................................................54

◆ Financial Data Processing Systems ........................................................55

◆ Contracting and Facilities ......................................................................56

◆ Legislative and Regulatory Reviews ......................................................58

Inspection Service........................................................................................59

◆ Financial Installations..............................................................................59

◆ District Accounting Offices ....................................................................60

◆ Contracting and Facilities ......................................................................60

◆ Revenue Investigations ..........................................................................61

◆ Embezzlements..........................................................................................62

◆ Workers’ Compensation ........................................................................62

TECHNOLOGY REVIEWS ......................................................................................65

Office of Inspector General ........................................................................66

◆ Year 2000 Issues ......................................................................................66

◆ Developmental Reviews..........................................................................67

◆ Computer Security ..................................................................................67

◆ Information Systems................................................................................69

◆ Electronic Commerce..............................................................................69

◆ Legislative and Regulatory Reviews ......................................................70
PAGE4 TABLE OF CONTENTS

◆ Legislative and Regulatory Reviews ..............................................

Inspection Service ..............................................................................

◆ Workplace Climate..........................................................................

◆ Postal Robberies ..............................................................................

◆ Drugs in the Workplace ..................................................................

OVERSIGHT REVIEWS OF INSPECTION SERVICE ..........................................

Office of Inspector General ................................................................

◆ Legislative and Regulatory Reviews ..............................................

OTHER SIGNIFICANT REVIEWS....................................................................

Office of Inspector General ................................................................

◆ Integrity Reviews..............................................................................

◆ Executive Investigations..................................................................

◆ Government Performance and Results Act ..................................

◆ Legislative and Regulatory Reviews ..............................................

Inspection Service ..............................................................................

◆ Physical Security ............................................................................

◆ Narcotics Offenses and Trafficking ................................................

◆ Fraud Against Consumers ..............................................................

◆ Fraud Against Businesses ................................................................

◆ Fraud Against the Government......................................................

◆ Child Exploitation ..........................................................................

◆ Prohibited Mail ................................................................................

◆ Postal Burglaries ..............................................................................

APPENDICES ................................................................................................

Appendix A - Closed Congressional Inquiries..................................

Appendix B - Reports Issued to Postal Management ......................

Appendix C - Findings of Questioned Costs ....................................

Appendix D - Recommendations That Funds Be Put to Better Us

Appendix E - Unresolved Reports ....................................................

Appendix F - Summary of Inspection Service Actions 

Under 39 USC 3005 and 3007 ....................................................

Appendix G - Criminal Statistics ......................................................

EXHIBITS ......................................................................................................
PAGE 5

What is the value of jointly reporting

OIG and Inspection Service results in a

unified Semiannual Report?

A unified Semiannual Report to Congress

provides a complete accounting to the

Postal Service stakeholders on joint efforts

to prevent and detect fraud, waste, abuse,

and mismanagement in the major programs

and operations of the Postal Service.

DID YOU 

KNOW?
p

Semiannual Report addresses the major challenges the Postal Service faces as it enters the

21st century, and the many reviews performed

—from preparing for Year 2000 (Y2K) readiness, to exploring electronic commerce and

computer intrusion issues, to investigating mail

thefts and workplace violence—that help

improve Postal operations.

The OIG and the Inspection Service conduct reviews and investigations—independently and collaboratively—that play a vital role in

helping the Postal Service make improvements.

Work performed by both the OIG and the

Inspection Service is included in this report.

We have included examples of Inspection Service work to present Congress and the Governors with a unified report of the work being

done within the Postal Service to combat fraud,

waste, abuse, and mismanagement. 

In this, our sixth Semiannual Report, we

have changed the report organization from the

“Voice of the Employee,” “Voice of the Customer,” and “Voice of the Business,” to six subject matter areas: 

◆ performance, 

◆ technology,

◆ financial management,

◆ labor management, 

◆ oversight of the Inspection Service, and

◆ other significant issues.

We also created a new section called “Customer Service” which outlines OIG and Inspection Service commitment to providing the best

quality customer service available. We believe

this new format provides a clearer understanding of where our work falls within the major

management and program challenges facing the

tions. 

The following highlight

and Inspection Services’ ac

ments as reported in the b

report under the six subjec

(1) The area of performance fo

forming critical core business pro

to succeed in a competitive envir

OIG conducted 28 reviews in th

included projects that will help s

Service over $1.1 billion in curre

years. A few examples of work 

include reviews on the: 

◆ Corporate Call Management 

◆ emergency trip expenditures 

routes; 

◆ rail detention costs; and 

◆ Priority Mail Processing Cen

The Inspection Service focused o

◆ improving registered, priorit

Class Mail service; 

◆ vehicle utilization; and 

◆ mail thefts amounting to ov

(2) In the area of technology, w

passes Y2K preparation, inform

and infrastructure, developme

telecommunications, and comp

the OIG: 

◆ issued four reviews on Postal 

readiness; 

◆ reviewed the Point of Servic

ONE system; and

◆ made several recommendati

improve computer security. 

PAGE6 EXECUTIVE SUMMARY

The OIG Management Committee consists of

(left to right) Assistant Inspectors General

Richard Chambers, Sylvia Owens, Ronald

Merryman; Inspector General Karla

Corcoran; Assistant Inspectors General

Norm Hancock and Billy Sauls; and General

Counsel Tom Coogan.

THIS PAGE TEARS OUT FOR YOUR CONVENIENCE
PAGE7

◆ reviewing the Dinero Seguro money

transfer program and subsequent discovery of a money laundering scheme;

◆ monitoring Postal Service compliance

with the Bank Secrecy Act; and 

◆ reviewing five contracts and facilities

that resulted in over $2 million in

recovered costs. 

In addition to other work, the Inspection

Service:

◆ conducted 111 financial installation and

17 district office audits to review the adequacy of internal controls;

◆ performed numerous contracting and

facilities audits, one of which focused on

services related to Mail Transportation

Equipment Service Centers and identified approximately $6.7 million in questioned and $1.8 million in unsupported

costs; and 

◆ investigated a major printer of catalogs

and magazines for underreporting charges

due to the Postal Service, which led to a

$22 million settlement. 

(4) The labor management area focuses on

issues related to violence in the workplace,

workplace climate, health care, and the Postal

Employees Safety Enhancement Act. During

this reporting period, the OIG conducted 36

reviews in this area, including: 

◆ an audit of the violence prevention program in the Suncoast district that found

proper violence prevention procedures

were not followed;

◆ a review that disclosed that a plant manager endangered employees by encouraging the purchase of a pistol which was

brought to an official function; and

and 

◆ arrested 14 Postal Service employees for

narcotics violations. 

(5) In the area of oversight of the Inspection

Service, the OIG completed 10 reviews. A

sampling of those include: 

◆ an audit to determine if inspectors

performing audits were properly classified

as law enforcement officers; and 

◆ a review of a contractor’s allegation of

misconduct by Postal inspectors. 

(6) Other significant reviews included

projects that do not readily fall into the other

five categories. The OIG reviews include: 

◆ an effort to improve the administration

of Postal Service’s ethics program; 

◆ ongoing investigations of senior-level

Postal Service executives; and 

◆ monitoring of the Government Performance and Results Act. 

The Inspection Service conducts numerous audits and investigations covering significant issues in the areas of: physical security, narcotics trafficking, fraud against businesses, fraud

against consumers, fraud against the government, child exploitation, mail bombs and

threats, and prohibited mail. 

In addition to these six subject matter

areas, the section “Major Management Issues

Facing the Postal Service” expands on the most

significant issues currently facing the Postal Service. The “Overview” and “Organization” sections provide a snapshot of the internal workings of the OIG and the Inspection Service; and

the “Goals” section describes our visions and

future direction.

OIG is to prevent, de

report fraud, waste an

abuse and to promote 

in the programs and o

the Postal Service.
PAGE

8 EXECUTIVE SUMMARY

THIS PAGE TEARS OUT FOR YOUR CONVENIENCE
Does the Postal Service have to follow 

Federal Government laws and rules like other

agencies?

No. Except for certain laws and regulations expressly

made applicable to the Postal Service, most federal laws

of government-wide applicability do not apply to the

Postal Service. This permits the Postal Service, an 

independent establishment of the executive branch, 

to operate in a business-like manner.

DID YOU 

KNOW?

PAGE 9
number of significant issues. Some of these

issues arise from external factors such as new

legislation, regulations, and competition. Other

issues are internally based such as enhancing

productivity, managing costs, and improving

labor management.

In order to identify the highest priority

issues facing the Postal Service, the OIG - with

the assistance of Postal Service Governors,

management, unions, and management associations - responded in 1998 to a Congressional

request and identified 10 major management

issues facing the Postal Service. Given the

dynamic environment in which the Postal Service is operating, management issues are evolving rapidly. As a result, OIG recently updated

the list of major issues facing Postal Service

management at the beginning of a new century. 

The revised list consists of 7 issues that consolidate the previously identified 10 issues. The

current list includes: (1) achieving Y2K readiness; (2) remaining competitive in a dynamic

environment; (3) leveraging technology; (4)

ensuring data reliability; (5) enhancing financial

and operational performance; (6) increasing customer service and satisfaction; and (7) improving

the work climate and labor relations. 

The following information discusses the

significance of each issue in more detail and

identifies some of the reviews OIG has scheduled to address each issue during Fiscal Year

(FY) 2000.

ACHIEVING Y2K READINESS

The Y2K challenge remains the most

urgent and critical technology issue facing the

Postal Service. The Y2K problem results from

the way in which automated systems store and

process dates. In many systems, the Year 2000

as systems correction (remediat

readiness verification (validatio

quality, budgeting, and contractin

with only two months remaining 

2000, work still needs to be com

areas of continuity planning and t

To address this major manage

FY 2000, among other reviews, th

◆ Monitor testing of business c

and contingency plans in th

that remain before the Year 

◆ Assess the Postal Service’s re

Y2K recovery efforts are nec

◆ Provide Congress, the Gove

senior Postal Service manag

accurate and timely informa

status of Y2K readiness with

Service.

REMAINING COMPETITIV

DYNAMIC ENVIRONMEN

The Postal Service is operati

competitive environment unprec

history. Maintaining or building 

will prove to be a significant challe

emergence of the private deliv

aggressive foreign competitors, 

electronic communications, an

commerce. 

Competition from the Intern

communications, and electronic c

prove even more formidable than 

enced from private and foreign 

The Postal Service recently projec

Class Mail volume will decline at 

of 2.5 percent beginning in FY 20

significant threat is posed by 

which may siphon off as much 

PAGE10 MAJOR MANAGEMENT ISSUES FACING THE POSTAL SERVICE

to all Postal Service officers the

audit roles of the OIG. Specifically,

the OIG is responsible for performing or contracting for all 

Postal Service audits, as well as 

establishing procedures for 

management-requested audits. 

In addition, the OIG will serve as

the focal point with other agencies,

to coordinate work efforts and

avoid any duplication. Postal

Inspectors have continued to 

perform audits to assist OIG 

during the transitional period.

Achieving Y2K readiness is a major management issue facing the Postal Service.
PAGE11

ducing non-postal products, and has generally

been restricted to offering “traditional postal

services.” Therefore new initiatives have not

been a significant factor in generating revenue.

To address this major management issue in FY

2000, among other reviews, the OIG will:

◆ Assess the use of the “Electronic Postmark” in establishing a Postal Service

role in Internet commerce;

◆ Review strategic and operational 

planning for electronic commerce; 

◆ Evaluate the infrastructure needed to

support electronic commerce activities; 

◆ Assess the status of PC Postage and its

potential for revenue generation;

◆ Examine the role of marketing in 

maintaining and promoting the Postal

Service’s competitiveness;

◆ Evaluate the marketing strategy effectiveness of local advertising initiatives; and

◆ Evaluate planning in transportation 

contracting to prepare for the potential

loss of First-Class Mail to electronic 

commerce.

LEVERAGING TECHNOLOGY

Like everyone else, the Postal Service is

seeking ways to use the constantly changing

technology to improve its service, productivity,

and profitability. While it depends on technology to deliver more than 650 million pieces of

mail every day, the Postal Service must continue to adapt to each new wave of technology

quickly to maintain its market presence. The

Postal Service budgeted almost $1 billion in FY

1999 for the information systems portion of the

technology arena alone. However, technology

fourth quarter, and the Postal Service needs to

get in the game.”

To address this major management issue in

FY 2000, among other reviews, the OIG will:

◆ Assess efforts to establish a Postal-wide

computer security program and other

critical infrastructure initiatives;

◆ Examine specific aspects of Internet security;

◆ Assess the effectiveness of security controls over telecommunications;

◆ Evaluate the integrity of key electronic

commerce systems;

◆ Evaluate the performance and costs 

associated with the Tray Management

System;

◆ Monitor and evaluate the research of

new automation initiatives critical to 

the Integrated Postal Facility;

◆ Evaluate the performance and costs associated with the Robotics Program; and

◆ Provide continuous review of the POS

ONE development and deployment.

ENSURING DATA RELIABILITY 

Reliable data is a key ingredient for effective decisionmaking, and is also vital to measuring performance and gauging the overall success

of an organization. For the Postal Service, reliable data is also essential in the rate-making

process. Further, in many instances, we have

found that the Postal Service does not capture

the necessary data for effective decisionmaking.

Despite the importance of reliable data, a

recent study on data reliability within the Postal

Service concluded that the increasing pace of

change in the environment and technology of
the External First Class Measurement

System;

◆ Examine the integrity and reliability of

data used to compute Total Factor 

Productivity;

◆ Monitor implementation of the Government Performance and Results Act;

◆ Evaluate the reliability of information

supporting the construction of new 

facilities; and 

◆ Assess the reliability of vehicle maintenance data.

ENHANCING FINANCIAL AND

OPERATIONAL PERFORMANCE

The Postal Service must improve its financial and operational performance to ensure universal mail service at affordable rates. Unlike

other government agencies, the Postal Service

is funded almost entirely from revenues generated by operations. The Postal Service’s ability to

maintain affordable rates is dependent on controlling costs, protecting revenues, and improving productivity. Postal Service management

must concentrate on streamlining operations

and providing competitively priced products

and services. Monitoring performance and

making sound business decisions is critical if the

Postal Service is to be a viable provider of mail

and package delivery service in the future.

To address these major management issues

in FY 2000, among other reviews, the OIG will:

◆ Assess the financial impact of the Postal

Service’s FY 1999 budget reductions and

cost containment initiatives;

◆ Evaluate the Postal Service’s Christmas

operations to identify means of better

aligning transportation costs with 

corresponding revenues;

priation requests; 

◆ Review potential environme

ties; 

◆ Determine the effectiveness 

process for making major inv

decisions within the Postal 

Decision Analysis Reports; a

◆ Assess the accuracy of paym

way contractors.

INCREASING CUSTOMER 

AND SATISFACTION

In today’s marketplace, cu

choices about how they conduct 

transmit messages, and deliver 

The Postal Service views its access 

ican household as a unique asset t

on in the face of increasing 

Increasing service delivery and c

faction will be key to building loy

ing new business. Timely, reliabl

tent delivery performance is on

quality service as perceived b

Increasing flexibility within the P

network to match the diversity of 

will also be important to enhanc

satisfaction.

To address this major manage

FY 2000, among other reviews, th

◆ Evaluate the appropriateness 

sures used to assess air carrie

mance; 

◆ Examine the sufficiency and 

ness of the Priority End-to-E

ment System;

◆ Review the effectiveness of p

standards in place for retail c

PAGE12 MAJOR MANAGEMENT ISSUES FACING THE POSTAL SERVICE

Increasing service and satisfaction to

over seven million customers every day

is a major management issue facing the

Postal Service.
PAGE13

IMPROVING THE WORK CLIMATE

AND LABOR RELATIONS

The Postal Service has characterized labor

management as one of its most important challenges in achieving its goals in the 21st century.

With approximately 800,000 career and

100,000 part-time employees, improving workplace relations among labor, management, and

the unions and associations that represent

them, is a key objective within the Postal Service. 

To operate effectively in a rapidly changing

environment, the Postal Service will need to

give the needs of its employees a higher priority

and enhance each employee’s contributions to

organizational performance. To think creatively and perform in their greatest capacity,

employees must not only have the technical

skills needed to perform the work but also have

a safe and healthy workplace. 

To excel in this dynamic environment, the

Postal Service needs to resolve persistent labor

management problems, such as adversarial attitudes, disparate treatment of employees, and

management styles that negatively affect productivity. Eliminating these problems and

embracing technological advancements will

require partnering with employees and the

unions that represent them. 

In addition to traditional labor management challenges, the Postal Service faces a new

challenge as a result of the Postal Employees

Safety Enhancement Act. This statute extends

many of the provisions of the Occupational

Safety and Health Act to the Postal Service. In

addition, the Postal Service faces the continuing challenge of managing employee injuries

and the resulting costs relating to workers’

compensation claims. 

climate and operations;

◆ Ascertain the effectiveness of workplace

climate assessments; 

◆ Examine administration of light and limited duty assignments; and 

◆ Review the consistency of disciplinary

actions.

OIG and other Postal offic

the Universal Postal Unio

Beijing, China, which was 

China’s President Jiang Z
PAGE14 MAJOR MANAGEMENT ISSUES FACING THE POSTAL SERVICE
What is a “performance” audit?

Performance audits assess whether

Postal Service operations are managed

economically and efficiently, achieve

desired results, and are in compliance

with applicable laws and regulations. 

DID YOU 

KNOW?

PAGE 15
PAGE16 POSTAL SERVICE REPORTED ACCOMPLISHMENTS

sured by the independent External FirstClass Measurement System; measured

on-time performance in 465 regions

nationwide;

◆ Established the information infrastructure

necessary to confirm the delivery of

parcels; called “Delivery Confirmation,”

the service requires a nominal up-front

fee; delivery reports are available to customers via a toll-free number and the

world-wide web;

◆ Earned three “Closing the Circle” awards

from the White House for programs that

conserve resources and protect the environment; the awards recognize accomplishments in the recycling of electronic

components and batteries and the construction of “green” buildings; and

◆ Authorized the purchase of 500 electric

vehicles, making the Postal Service one

of the biggest investors in zero-emissions

vehicles in the world; present inventory

of alternate fuel vehicles is more than

8,000 and is expected to grow to more

than 30,000 by 2001. 

FINANCIAL MANAGEMENT 

◆ Challenged managers at every level to

boost productivity and reduce costs to

make up shortfalls from the deferred rate

increase; in spite of lower than expected

revenues, projected year-end net income

was $300 million; and

◆ Increased to more than $8 million the

total raised for breast cancer research by

the Breast Cancer “semi-postal” stamp. 

public key infrastructure to 

the security of postal service

include an electronic compo

LABOR MANAGEMENT 

◆ Supported landmark agreem

formalize cooperation with t

Postal Mail Handlers Union 

National Rural Letter Carrie

tion to create a safer, health

place; the agreements parall

agreement with the America

Workers Union. 

INSPECTION SERVICE 

◆ Named Kenneth C. Weaver 

Chief Postal Inspector, succe

Kenneth J. Hunter, who reti

recently received an award f

Association of Certified Frau

for his lifetime work in prev

detecting fraud. 

OTHER SIGNIFICANT ISS

◆ Supported the 1999 Tour de 

winning team; publicity boo

ness of Postal products and s

worldwide, providing encour

and hope to cancer victims t

remarkable accomplishment

Armstrong. 

This summarizes the Pos

accomplishments over the last 

as reported to the OIG by 

management. 

The FY 2000 budget for OIG is

$72 million.
Does the OIG have access to all Postal

Service documents and information?

The Inspector General Act specifically 

provides that the Inspector General is 

authorized “to have access to all records,

reports, audits, reviews, documents, papers, 

recommendations, or other material available

to the applicable establishments.”

DID YOU 

KNOW?

PAGE 17
PAGE18 OVERVIEW

COMMON GOAL

The OIG is independent of Postal Service

management and is under the general supervision of nine Presidentially-appointed Postal

Governors who also oversee Postal Service

management. In January 1997, Karla W.

Corcoran was appointed the first independent

Inspector General for the Postal Service. From

1988 until the establishment of this newly

established OIG, the Chief Postal Inspector performed dual roles as the Inspector General and

Chief Postal Inspector and reported to the Postmaster General.

In carrying out its responsibility under the

Inspector General Act, the OIG:

◆ conducts independent audits and investigations of Postal Service programs and

operations to ensure the efficiency and

integrity of the Postal Service; 

◆ exercises oversight responsibility for all

activities of the Inspection Service; and 

◆ keeps the Congress, the Postal Service

Governors, and management fully and

currently informed about problems, deficiencies, and the progress of corrective

actions.

The OIG is independent, but it shares with

the Inspection Service a common goal -- to

improve Postal Service operations.

Benefits of an Independent Office of

Inspector General

As an independent and distinct entity

within the Postal Service, the OIG, which is

separate from Postal management:

◆ provides management and the Governors, as well as the Congress, with timely,

objective, and complete information and

vice and performs independe

complaints against Inspectio

employees; 

◆ facilitates audit resolution an

which provides meaningful m

for resolving findings and re

tions where the OIG and Po

management are in disagreem

assuring that management im

corrective actions; 

◆ adds value to Postal Service 

contributes to a more econo

efficient organization, and h

Postal Service maintain its i

through independent invest

audits, and reviews;

◆ serves as a venue for all emp

other stakeholders to report 

abuse, mismanagement, and 

prieties and concerns, with p

from retaliation; and 

◆ achieves cost savings, enhan

and program administration

es employee and program eff

integrity.

The OIG has demonstrated 

dence in a variety of ways, includ

its results to the Governors and C

example, the OIG issued 14 report

years in the areas of new product 

new business processes, new an

automated equipment, and autom

development. Synopses of these 

provided to Congress and the Gov

and prior semiannual reports. In co

indicate that for the five-year peri

OIG was established, reviews of 15 

tal projects had been opened, but 

reported. While this office 

OIG Information Technology staff help

maintain our computer proficiency.

Tray Management is one of the Postal

Service developmental systems that OIG

has reviewed and provided information to

the Governors and management. 
PAGE19

official, or reported to the Governors or Congress. Sections of prior semiannual reports did

identify unresolved findings. However, this

information only described issues for which

management had agreed to take corrective

action that had not been fully implemented.

These reports did not state where management

had disagreed with the findings as envisioned by

the requirement of the Inspector General Act.

The new process will correct this lack of information by reporting recommendations with

which management did not agree.

The purpose of the OIG in providing

objective information, analysis, and recommendations is to improve Postal Service programs

and operations. However, sometimes the information and analysis provided by the OIG might

cause consternation for program and Postal Service management who may need to rethink previous decisions. The OIG is still working with

Postal Service officials to inform them of the

duties and responsibilities of an independent

OIG.

OIG Vision and Values

The vision of the OIG is “A Constellation

of Talented People Making a Difference.” This

vision is important because the mission of an

Inspector General’s office is to shed light on the

problems of its agency and ensure that corrective action is taken. The OIG emphasizes these

five fundamental values:

◆ Teamwork - combining diverse talents 

to achieve synergy;

◆ Leadership - encouraging each other to

be the best each can be;

◆ Communication - facilitating honesty,

openness, respect, and consideration for

y gppy 

develop their unique and diverse skills and abilities to their fullest potential. The OIG is committed to attracting a diverse and highly qualified workforce from government, the private

sector, the Postal Service, and colleges and universities.

The OIG is proud of its diversity and is

committed to developing and utilizing the talents of all its employees. Many of its employees

have advanced degrees and are Certified Public

Accountants, Certified Internal Auditors, Certified Information Systems Auditors, Certified

Fraud Examiners, and Certified Acquisition

Auditors. In addition, a number of its investigators hold law enforcement specialty certifications in areas such as polygraph examinations

and seized computer evidence recovery. OIG

criminal investigators receive rigorous training

at the Federal Law Enforcement Training Center or an equivalent law enforcement academy.

Employee education and professional certification enhances the OIG’s ability to add value to

the Postal Service. 

OIG Diversity

During the past six months, OIG hired a

total of 110 employees. As of September 30,

1999, 403 individuals are on board, of which

175 (43 percent) are women and 168 (42 percent) are minorities. Minorities include: 

◆ 116 Blacks (28 percent),

◆ 27 Hispanics (7 percent), 

◆ 23 Asians (6 percent), and

◆ 2 Native Americans (1 percent). 

Based on the latest U.S. Bureau of the

Census estimates, the OIG has met or exceeded

the U.S. percentage of total population for each

0%

5%

10%

15%

20%

25%

30%

HISPANICBLACK

Diversity S

28

7

COMPARISON OF OIG TO CEN

11

10

A diverse and talented gro

attending an OIG orientatio
PAGE20 OVERVIEW

OIG’s greatest challenges. In addition, the OIG

may need to increase its staffing levels and hiring efforts because of a recent decision by the

Inspection Service not to perform “Yellow

Book” audits in the future. The OIG is reviewing this decision of the Inspection Service to

determine what effect it will have on the OIG.

Striving To Be a Model Organization

The OIG strives to be a model organization

by using the latest available technology, the

most innovative ideas of its employees, and the

best business practices of both the public and

private sectors. Its internal goal is to build an

efficient, effective, and economical organization. The OIG staff works to establish best

practices by benchmarking with other organizations and exemplary performers. The OIG is

also working to develop streamlined policies to

facilitate innovation. By making its policies

broad and flexible, the OIG encourages innovative thought and the development of improved

processes and procedures. These include:

◆ forming interdisciplinary project teams of

investigators, evaluators, statisticians, and

attorneys for greater diversity and objectivity;

◆ using technology-based teams for computer intrusion, information systems

audits, and electronic commerce;

◆ analyzing more data in a shorter time

through specialized teams that use computer retrieval and system command languages; 

◆ using electronic work papers and developing automated investigative programs

that aid in the documentation and 

analysis of data; and

Awards of Excellence and eigh

Mentions. The Awards of Exce

nized our work in the areas of Y2

agement, computer intrusion, a

subpoenas. 

OIG Submits Testimony Con

Consumer Fraud

At the invitation of the Ho

mittee on the Postal Service, C

Government Reform, the OIG su

ten testimony on legislation conc

stakes mailings. The legislation 

help protect the American publi

tive mailings and would give the 

subpoena authority in the area o

mailings. The OIG testimony 

legislation; however, it sugges

improve the administrative subpo

if it is granted to the Postal Servic

OIG Pioneers Computer Int

Training

In cooperation with the N

nautics and Space Administrati

Postal OIG sponsored 9 two-w

intrusion training courses. Over 

tors, auditors, attorneys, and com

officials in the Postal Service an

federal and local law enforcem

received specialized training.

OIG Receives Combined Fed

Campaign Award

OIG was featured in the 19

Federal Campaign, “Catalog of 

“Pacesetter Award” winner, the 

recognized. The Pacesetter Award 

agency that achieves at least a 

increase over the previous year’s re

Assistant Inspector General for Employee

Billy Sauls accepted the Award of

Excellence for his teams’ work in Labor

Management.

The OIG received twelve awards, including

four Awards of Excellence from the

Inspector General community for its work.
PAGE21

Illinois; New York, New York; Los Angeles,

California; and Raleigh, North Carolina.

Inspector General Serves as Delegate to

Universal Postal Union

The Inspector General attended the 22nd

Universal Postal Union in China as an official

U.S. delegate in August 1999. She was accompanied by the Assistant Inspector General for

Audits, who attended the World Conference

on Direct Mail at the same time. During this

visit, they were able to view the role of the

Postal Service in the international arena firsthand. 

OIG Successfully Enforces Subpoenas 

The OIG continues its success in court

enforcement of administrative subpoenas.

Generally, the OIG goes to court to compel a

party to comply with a subpoena after the party

refuses to comply. In an unusual enforcement

action, the OIG, together with the Department

of Justice, successfully overturned a court’s preliminary injunction obtained by the subject of

an investigation to prevent the OIG from subpoenaing information from the subject’s data

processor. 

Notification to Postal Service Employees of OIG Roles and Authorities

In a joint effort, the OIG and the Inspection Service updated the Postal-wide guidance

published in the Administrative Support Manual to reflect the responsibilities of the OIG.

The chapter, entitled “Audits and Investigations,” appeared in the July 1999 edition of the

manual. Specifically, the changes identify the

OIG as an independent entity with the authority and responsibility to conduct audits and

investigations as well as having oversight

local law enforcement community.

OIG Workplace Climate Survey Yields

Favorable Results

Over two-thirds of OIG employees voluntarily participated in a workplace climate survey

conducted by an expert in the law enforcement

field. The survey indicated that even though

the OIG is still a developing agency, it is a solid

organization, posting scores that compare favorably to long-established government agencies

and Fortune 500 companies.

PROGRESS IN BUILDING THE

OIG INFRASTRUCTURE

As the OIG has continued to build its

infrastructure, it established: 

Human relations processes and systems,

including:

◆ a 360-degree feedback evaluation system;

◆ an interim pay-for-performance system;

◆ an extensive screening process for potential new employees;

◆ a thorough pre-employment background

investigation process;

◆ 10 one-week orientation classes for new

employees;

◆ a biweekly employee newsletter; and

◆ a three-week Postal-specific investigative

training program.

Administrative resources services, including:

◆ placement of management controls over

its internal processes;

◆ development of its own contracting 

function;

◆ establishment of OIG offices by identifying, leasing, and developing space to

Chapter 2 describes th

and investigation respo
PAGE22 OVERVIEW

all levels of their right to report wrong

doing to OIG without fear of retaliation;

◆ engineering an electronic subpoena system to improve processing of Inspector

General administrative subpoenas;

◆ deploying a report processing review staff

to expedite and standardize issuance of

reports;

◆ working with the Postal Service to ensure

the development of a valid tracking system for recommendations from the external auditor, General Accounting Office,

Inspection Service, and OIG;

◆ entering into an agreement with the

Financial Crimes Enforcement Network

to access numerous commercial, financial, and law enforcement databases to

help with criminal financial investigations and audits;

◆ processing over 40 Freedom of Information Act requests and closing 50 Congressional responses;

◆ issuing 143 subpoenas (103 for the

Inspection Service and 40 for the OIG);

and

◆ providing quarterly firearms qualifications

and defensive tactics training to OIG

criminal investigators.

Strategic processes, including:

◆ revising OIG’s five-year Strategic Plan;

◆ developing a universe of over 1,000 projects; 

◆ preparing the FY 2000 Annual Performance Plan;

◆ achieving over 80 percent of the performance measurements for FY 1999, which

resulted in a Team Award for OIG

into three broad categories: OIG 

internal to the Postal Service, an

the Postal Service. As the OIG 

future, the key challenges in th

are:

OIG Infrastructure: 

◆ hiring additional talented an

staff;

◆ building its processes, policie

dures;

◆ promoting its values and cul

◆ continuing to forge ahead w

sion while being sensitive to 

of extensive demands that a

placed on its employees in it

environment.

Internal to the Postal Service: 

◆ continuing to add value by p

meaningful results on a time

◆ educating Postal Service ma

the independence of the OIG 

duty to report any significan

the Postal Service Governor

gress;

◆ resolving differences, includ

concerning authority, roles, 

bilities of OIG and the Inspe

Service;

◆ maximizing the impact of O

by instituting effective resolu

processes to enable Postal m

to better respond to audit fin

recommendations;

◆ informing Postal Service off

OIG’s authority to make ind

decisions on areas to review

OIG has established quarterly firearms

training for its criminal investigators.
PAGE23

communities; and 

◆ effectively dealing with Hotline and

Congressional inquiries.

NJ

PENNSYLVANIA OHIO

ALASKA

HAWAII

NEW YORK

MA

VT

NH

MAINE

CT RI

CALIFORNIA

LOUISIANA

TEXAS

ILLINOIS

INDIANA

MICHIGAN

WISCONSIN

MINNESOTA N. DAKOTA

NEBRASKA

KANSAS

OKLAHOMA

ARKANSAS

MISSOURI

IOWA

S. DAKOTA

W. VA

N. CAROLINA

S. CAROLINA

KENTUCKY VIRGINIA

MD

DE

UTAH

ARIZONA

NEVADA

WYOMING

MONTANA

COLORADO

WASHINGTON

OREGON

IDAHO

NEW MEXICO

FLORIDA

GEORGIA

TENNESSEE

ALABAMA MISSISSIPPI

NJ

WESTERN MID-WEST GREAT LAKES

NORTHEAST

PACIFIC

SOUTHWEST

SOUTHEAST

MID-ATLANTIC

ALLEGHENY

NEW YORK METRO PENNSYLVANIA

PUERTO RICO

US Postal Service Areas

Districts, Employess and Facilities

DISTRICTS EMPLOYEES FACILITIES

Allegheny 10 89,513 3,960

*Mid-Atlantic 9 104,606 4,798

Great Lakes 7 89,555 2,899

Mid-West 7 91,084 6,391

New York Metro 7 83,803 1,780

DISTRICTS EMPLOYEES FACILITES

Northeast 9 75,742 3,506

Pacific 10 100,562 2,348

Southest 9 103,949 3,877

Southwest 7 86,014 4,205

Western 10 78,629 3,956

(*Includes Capitol Metro & HQ's, Related REC) Facilities data as of end of 9/27/99; Employee data as of 9/24/99

DISTRICTS EMPLOYEES FACILITIES DISTRICTS EMPLOYEES FACILITES

TOTALS 85 903,457 37,720

This chart illustrates the magnitude of Postal Service operations and the workforce that OIG reviews.
PAGE24

the Inspection Service provides an essential service to the American public and the Postal Service. The Inspection Service has almost 4,500

employees, which includes over 2,100 Postal

Inspectors, over 1,500 uniformed Postal Police

Officers, and almost 850 professional support

associates.

The national headquarters of the Inspection Service is organized into functional groups

that report to the Deputy Chief Inspectors for:

◆ Business Investigations;

◆ Criminal Investigations; 

◆ Professional Standards & Resource 

Development; and 

◆ Administration. 

The Inspection Service includes 23 field

divisions that report directly to two Deputy

Chief Inspectors for Field Operations. The field

offices are also supported by five Operations

Support Groups. The Inspection Service

Forensic Laboratories, located at five sites, support field office investigations and provide

state-of-the-art technology. Inspection Service

offices are linked nationally through electronic

systems with on-line connections to the

National Crime Information Center and the

National Law Enforcement Telecommunications System. 

Postal Inspectors conduct criminal investigations, perform audits delegated to them from

the OIG, make arrests for Postal offenses, serve

warrants and subpoenas, and present evidence

to prosecutors for action. Inspectors respond to

emergencies involving Postal Service crimes,

natural disasters, and other problems that affect

the Postal Service. 

Along with the coverage of the Postal

Inspection Service is recognized in

with Inspectors assigned to the U

Central Bureau of Interpol in 

D.C., and to Interpol Headquar

France. The Inspection Service 

role within the Universal Postal 

has established the following prio

◆ prevent injuries to customer

from dangerous goods in the 

◆ prevent the loss or theft of m

ed by customers to world Po

trations;

◆ prevent revenue and asset lo

Postal administrations; and

◆ preserve customers’ confiden

mail.

Postal Inspectors are active mem

cils and groups, such as the:

◆ Financial Crimes Enforceme

◆ Organized Crime Council;

◆ International Policy Comm

International Association of 

Police;

◆ International Association of 

Crimes Investigations;

◆ Securities and Commodities 

Working Group;

◆ Economic Crimes Council;

◆ National Health Care Anti-

ciation;

◆ National Law Enforcement 

Committee; and

◆ Asset Forfeiture Policy Adv

Postal Inspectors also work with 

organizations regarding child 

Postal Police Officers play an integral

role in protecting Postal employees,

facilities, and assets.

OVERVIEW
PAGE25

◆ Providing forensic examinations;

◆ Developing, procuring, and deploying

electronic security and surveillance

equipment;

◆ Providing photography, video, and graphics support;

◆ Publishing policies, reports, manuals,

handbooks, and consumer publications;

◆ Developing and maintaining management systems;

◆ Providing direct contact with Congress

and the public; and

◆ Supplying administrative support.

Kenneth J. Hunter, who was appointed

Chief Postal Inspector in 1992, announced that

he would retire in October 1999 to pursue a

career in the private sector. Kenneth C.

Weaver, who has worked for the Postal Service

for over 28 years as an Assistant Secretary to the

Board of Governors and as a Postal Inspector,

has been appointed by the Postmaster General

as the new Chief Postal Inspector. 

NOTABLE INSPECTION SERVICE

ACHIEVEMENTS

Former Chief Postal Inspector Honored

Former Chief Postal Inspector Kenneth J.

Hunter was chosen as the 1999 recipient of the

Cressey Award, the Association of Certified

Fraud Examiners’ highest honor. Bestowed

annually to signify lifetime achievement in the

detection and deterrence of fraud, the award

was named after one of the country’s foremost

experts on fraud, who was a founding father of

the association. Under Mr. Hunter’s direction,

the Inspection Service initiated partnerships

with national groups most affected by fraud

tributed the tapes across the country. As a result

of the investigation, eight men were charged in

federal and state courts for abusing at least 16

children, although the exact number may never

be known. 

Postal Inspector Receives Federal Bar

Association Achievement Award

Postal Inspector Joseph Taranto of the

Southern California District received the Federal Bar Association’s Distinguished Achievement Award for his dedication to excellence

and skilled leadership in investigating two car

bombings and identifying suspects within 48

hours. Thanks to Inspector Taranto’s efforts,

the suspect was convicted on all six counts,

including mailing a deadly explosive device, as

well as for the two car bombings. The suspect

was sentenced to two life terms, plus 10 years.

Postal Inspection Service Videos

Receive Telly Awards

A video produced by the Inspection

Service won a silver Telly Award and 4 others

earned bronze awards, given in recognition for

outstanding non-network television commercial, film and video productions. The awardwinning video, entitled “Little Favor, Big

Mistake,” was distributed to bank tellers nationwide to alert them to deceptive techniques used

to secure cash advances from stolen credit cards.

Other bronze award-winning videos dealt with

polygraphs, mail security, and job scams.

Kenneth Hunter retired af

Chief Postal Inspector fro

1999.
PAGE26 OVERVIEW
DID YOU 

KNOW?

PAGE 27

What are the locations of the OIG 

Headquarters and field offices?

The OIG is headquartered in Rossyln, VA, and its

other major office is the Western Duty Station in

Dallas, TX. Other OIG field offices are located in

Atlanta, Minneapolis, St. Louis, San Mateo, and

Denver. OIG plans to open offices in Chicago, 

New York, Raleigh, and Los Angeles.
PAGE28 ORGANIZATION

INSPECTOR 

GENERAL

Karla W. Corcoran

Special Assistant

(Vacant)

Executive Assistant

Cindy Monahan

GENERAL 

COUNSEL TO THE

INSPECTOR 

GENERAL 

Thomas Coogan

Congressional 

and Public Relations

Laura A. Whitaker

Legal Services

Kirt West

INVESTIGATIONS

Sylvia L. Owens

Deputy Ronald K. Stith

Deputy Richard S. Trinidad

Contracts

Kim Stroud

Facilities

Anthony T. Cannarella

Healthcare Fraud

Katherine K. Johnson

Revenue Generation

(Vacant)

Revenue Protection

Dan O'Rourke

Mike Shiohama

EMPLOYEE 

Billy Sauls

Deputy Ronnie Wainwrigh

Administrative Resources

Alan Lamoreaux

Human Resources

Connie Ambush

Information Systems

David I. Berran

Labor Management

Joyce Hansen

Chris Nicoloff

CUSTOMER

Norm Hancock

Deputy Debra Pettitt 

Computer Intrusion

Howard Cox

Consulting Services

(To be established in FY 2001)

Executive Investigations

Tommy Hampton

Hotline

Joe Oliva

Oversight

Bob Pemberton

Quick Response

(To be established in FY 2001)

ASSISTANT INSPECTOR

GENERAL

ASS SI

TANT

NI SPECTOR GENERAL

ASSISTA

NT

INSP

L

ASSISTANT IN

Deputy Robert Emmons

Deputy Colleen McAntee

Accepting/Processing

(Vacant)

Delivery

Bennie Cruz

Developmental

Tracy LaPoint

Financial Audit

John M. Seeba

Support

Gwen Johnson

Transportation

Debra Ritt

MANAGEMENT

Ronald Merryman

Deputy Wayne Goleski

Electronic Commerce

Robert Batta

Forensic & Technical Services

John DeMaggio

Information Technology

David Sidransky

Internal Quality

Jim Nugent

Quality Assurance/Internal Affairs

George Davis

Strategic Planning 

Russ Barbee
PAGE29

OFFICE OF INSPECTOR

GENERAL

ASSISTANT INSPECTOR GENERAL

FOR STRATEGIC PLANNING &

QUALITY MANAGEMENT, 

Ronald Merryman

Deputy Assistant Inspector General,

Wayne Goleski

ELECTRONIC COMMERCE TEAM

Director, Robert Batta - conducts reviews

of Postal Service initiatives in the emerging

field of electronic commerce, including areas

such as information-based indicia and electronic bill payment.

FORENSIC AND TECHNICAL SERVICES

TEAM

Director, John DeMaggio - provides technical support in such areas as surveillance, evidence recovery, firearms, computer forensics,

and polygraph examinations; and maintains

close liaison with technical experts in the law

enforcement community.

INFORMATION TECHNOLOGY TEAM

Director, David Sidransky - manages computer operations and telecommunications

within the OIG; operates the local and widearea networks; provides computer security and

technical support to OIG staff; and manages

agency-wide information systems.

INTERNAL QUALITY TEAM

Director, Jim Nugent - instills continuous

internal process improvement and facilitates

internal communications through orientation,

teambuilding, and mentoring.

, p, 

gy by identifying workload, providing research

and statistical analyses, informing Postal Service employees and customers about the OIG

mission, and promoting the vision of the OIG.

ASSISTANT INSPECTOR GENERAL

FOR AUDITS (PERFORMANCE),

Richard Chambers

Deputy Assistant Inspectors General,

Robert Emmons and Colleen McAntee

ACCEPTING AND PROCESSING TEAM

Director, (Vacant) - conducts audits and

reviews focusing on mail acceptance and collection operations, and mail processing and distribution processes.

DELIVERY OPERATIONS TEAM

Director, Bennie Cruz- conducts audits and

reviews to enhance delivery processes and operations and to improve customer satisfaction.

DEVELOPMENTAL TEAM

Director, Tracy LaPoint - conducts audits

and reviews of new or redesigned Postal Service

systems, programs, and operations that are

under development.

FINANCIAL TEAM

Director, John M. Seeba - conducts audit

work in support of the independent public

accounting firm’s annual financial audit opinion and conducts other financial-related audits

to identify areas for improvement.

Deputy Assistant Inspecto

Wayne Goleski, Debra Pett

Trinidad, Ronnie Wainwrig

Colleen McAntee, and Robe
PAGE30 ORGANIZATION

ations and contracts for airline, highway, and

rail services.

ASSISTANT INSPECTOR GENERAL

FOR INVESTIGATIONS (REVENUE

& COST CONTAINMENT), 

Sylvia L. Owens

Deputy Assistant Inspectors General,

Ronald K. Stith and Richard S. Trinidad 

CONTRACT AUDIT TEAM

Director, Kim Stroud - improves Postal Service contracting by conducting audits and

investigations of purchasing activities and

operations.

FACILITIES TEAM 

Director, Anthony T. Cannarella -

conducts audits, management reviews, and

investigations of all aspects of facilities including repair, renovation, and new construction.

HEALTH CARE TEAM

Director, Katherine K. Johnson - identifies and investigates medical providers that

have falsely billed the Postal Service for workrelated injury claims, and conducts audits of

systemic issues involving the Workers’ Compensation Program.

REVENUE GENERATION TEAM

Director, (Vacant) - examines and evaluates

the major sources of revenue from marketing,

advertising, stamp services, retail, and international mail business operations, and also monitors Postal rate cases.

ADMINISTRATIVE RESOURC

Director, Alan Lamoreaux - 

OIG staff with facility, procurem

budget, and other services necess

plish the OIG mission.

HUMAN RESOURCES TEAM

Director, Connie Ambush - 

service human resources program

in the areas of employee relation

and benefits, retirement, awards

management, counseling, diversi

ties, and training.

INFORMATION SYSTEMS TE

Director, David I. Berran - 

automated Postal management 

tion systems to determine Y2K r

whether applications are proper

and systems are properly design

accurate data to management; 

computer assisted audit techniqu

OIG staff.

LABOR MANAGEMENT TEA

Directors, Joyce Hansen and 

Chris Nicoloff - conduct audit

tions of labor management and e

tions issues within the Postal Se

in fostering and maintaining a h

zational climate for employees a

operational efficiency; also audits 

Postal Service systems and opera

ing violence prevention.

had 403 employees onboard.

OIG plans to hire an additional

245 staff in the next 12 months.

“Practice makes perfect” when

executing law enforcement

responsibilities.
PAGE31

may be implemented.

CONSULTING SERVICES TEAM

Director, (Vacant) - will assist Postal Service

management by identifying best practices for

improving the effectiveness of Postal Service

operations. (This team will be established in

FY 2001.)

EXECUTIVE INVESTIGATIONS TEAM

Director, Tommy Hampton - investigates

allegations of criminal activities and misconduct involving Postal Service executives.

HOTLINE TEAM

Director, Joe Oliva - operates the OIG Hotline to provide a vital and confidential communication link between the Postal Service

and the public.

OVERSIGHT TEAM

Director, Bob Pemberton - conducts audits

and evaluations of Inspection Service programs

and operations.

QUICK RESPONSE TEAM

Director, (Vacant) - will evaluate critical, timesensitive issues. This team will assist in

responding to requests from Congress and the

Governors. (This team will be established in

FY 2001.)

LEGAL SERVICES TEAM

Director, Kirt West - provides legal advice

to the Inspector General and OIG staff on

criminal, civil, and administrative issues;

processes subpoenas; responds to Freedom of

Information and Privacy Act requests; and

serves as liaison with the Postal Service Law

Department and Department of Justice legal

staffs.

Teams include various dis

provide OIG a synergistic 

accomplishing tasks.
AIC

Deputy Counsel

Z. HILL

AIC

Deputy Counsel

L. KATZ

INC

Finance and Admin.

Services

M. MUNLEY

INC

Congressional 

& Public Affairs

D. MIHALKO

INC

Information 

Technology

R. COCCIA

INC

Corporate Information

Management

R. LUERS

Managers

ISOSGs

Bala Cynwyd

L. KLAUS

Newark

V. BELLINGER

So. San Francisco

K. PARAMORE

INC

Financial

T. DENNENY

INC

Performance

A. CLEMMONS

INC

Fraud, Child Expl.

& Asset

Forfeiture Grp.

L. MAXWELL

INC

Revenue Assets

Protection Prog. 

S. SCHMERBECK

Manager

ISOSG

Chicago

D. HARRIS

INC

International

D. HILL

INC

Security

F. MARION

INC

Mail Theft &

Violent Crimes

J. ROWAN

INC

Forensic & Tech. 

Services

Division

R. GEFFEN

INC

Computer Crimes &

Commerce

J. EASLEY

AIC

Money Laundering

& Bank Secrecy

C. GIUSTI

Manager

IS0SG

Memphis

L. BROOKS

Inspectors in Charge

Florida - 

M. GREY

Mid Atl. - 

A. CRAWFORD

NY Metro - 

L. HEATH

North Jersey/Caribbean - 

J. SKIDMORE

Northeast - 

M. AHERN

Philadelphia Metro - 

B. CHAMBERS

Southeast - 

I. CARIFE

Washington Metro - 

(Vacant)

W. Allegheny - 

K. NEWMAN

Inspectors in Charge

Gulf Coast -

R. DODD

Michigan - 

W. MITCHELL

Midwest - 

R. TERLEP

No. Calif. - 

D. DAVIS

No. Illinois - 

I. GILLIS

Northwest - 

R. MORGAN

Rocky Mountain - 

M. COBOS

So. Calif. - 

J. FREEMAN

Southwest - 

A. HOLMES

INC

Strategic Plng. & 

Management Process

J. STINCHFIELD

INC

Career Develop.

Division

C. MURPHY

Manager Workforce

Strategic Plng.

N. ARROYO

Manager

Exec. Resources

and Ldrship. Dev.

E. LUCERO

Manager Employee

Development

N. JOHNSON

Manager Training

Assessment

S. CLARK

Inspection Service Organizational Structu

Chief Postal Inspector

K. C. WEAVER

Inspector in Charge

Officer of Counsel

H. J. BAUMAN

Deputy Chief Inspector

Administration

J. K. BELZ

Deputy Chief Inspector

Business Investigations

A. KIEL

Deputy Chief Inspector

Criminal Investigations

(Vacant)

Deputy Chief Inspector

Field Operations East

L. S. CRAWFORD

Deputy Chief Inspector

Field Operations West

J. J. DUPILKA

Deputy Chief Inspector Prof. Standards &

Resource Dev.

D. P. WRIGHT

O

J

PAGE32

AIC - Assistant Inspector in Charge

INC - Inspectors in Charge

ISOSG - Inspection Service Operations Support Groups

ORGANIZATION
What are the OIG “values”?

The OIG’s values are teamwork, 

leadership, creativity, communication,

and conceptualization, and are 

incorporated into a 360-degree

employee evaluation system 

nicknamed “TLC3.”

DID YOU 

KNOW?

PAGE 33
PAGE34

five-year strategic plan. As a result of its dynamic, internal operations and the changing environment of the Postal Service, the OIG is revising its five-year strategic plan.

In the published Strategic Plan for FYs

1998-2002, three external and three internal

goals aligned with each of the Postal Service’s

CustomerPerfect! goals were identified. The

revised plan will reflect one external and one

internal goal aligned with the CustomerPerfect!

goal that reduces the amount of duplication

between goals. These five-year goals are:

External Goal

Enhancing the Postal Service’s:

◆ customer service and value,

◆ employee and workplace environment,

and

◆ financial integrity and business viability.

Internal Goal

◆ effective use of OIG resources.

OIG PLANNING

PROCESS

These goals play a critical role in the OIG’s

planning process. The planning process has

three interrelated components: the project universe, the annual performance plan, and the

annual audit workload plan. The project universe, which includes all projects that could be

considered, is the umbrella of the plan. This

year, the OIG identified nearly 1,000 projects

for consideration. To hire staff to complete the

entire universe of projects in one year would be

unrealistic. Therefore, the OIG management

selects projects from the universe on the basis of

risk. These risk factors include:

nent is the OIG audit workload p

extracted from the annual perfo

This audit workload plan, wh

Inspection Service audits, is pre

Postal Governors each year.

THE ROAD AHEA

As the OIG expands its inf

will transition its focus to more 

vention and detection of fraud, 

and mismanagement, as well as t

of effectiveness, efficiency, a

throughout the Postal Service. T

continue to work with the Inspect

transition additional responsibilit

CustomerPerfect! goals and help th

vice meet its major management 

OIG GOALS

AUDITS & AUDIT RELATED PROJECT

INVESTIGATIONS

OTHER PROJECTS

INTERNAL ENABLING FUNCTIONS

POSTAL 

PROJECT

UNIVERSE

ANNUAL

PERFORMANCE

PLAN

AUDIT 

WORKLOAD

PLAN

CONSULTING

QUICK RESPONSE

FACT-FINDINGS

AUDITS & AUDIT RELATED PROJECT

INVESTIGATIONS

OTHER PROJECTS

INTERNAL ENABLING FUNCTIONS

POSTAL 

PROJECT

UNIVERSE

ANNUAL

PERFORMANCE

PLAN

AUDIT 

WORKLOAD

PLAN
Are all Hotline complaints 

confidential?

The identity of an individual who makes

complaints or provides information 

regarding alleged wrongdoing is held 

confidential unless the individual gives 

permission for the disclosure of their

name or if disclosure is required. 

DID YOU 

KNOW?

PAGE 35
PAGE36 CUSTOMER SERVICE

OFFICE OF INSPECTOR

GENERAL

OIG customers include Congress, the

Governors, Postal management and employees,

and the public. In addition to conducting

audits, investigations, and other reviews, OIG

demonstrates its commitment to service by

responding to customer concerns in a variety of

ways described below.

COMMUNICATING WITH 

CONGRESS AND THE POSTAL

SERVICE GOVERNORS

The OIG is legally responsible for keeping

Members of Congress and the Postal Service

Governors fully and currently informed. This is

done in several ways. The OIG keeps the Governors informed through regular briefings at

monthly Board meetings, preparing a monthly

activities report from the Inspector General,

and promptly responding to requests for information. The OIG keeps Congress informed by

issuing the “Semiannual Report to Congress,”

testifying at oversight and other hearings, and

briefing Members and their staff, as appropriate,

on issues related to the Postal Service. The

OIG also provides Congress and the Governors

with copies of its audit and management advisory reports on a regular basis.

One of the highest priorities of the OIG is

to provide accurate and timely responses to the

Congress and the Postal Governors. The OIG

Congressional and Public Relations team serves

as the liaison between OIG staff and the Congress and Governors and provides a myriad of

services, such as:

◆ serving as the point of contact and 

conduit of information for all OIG 

communications with Congress and 

the Governors;

◆ facilitating and monitoring OIG internal

processing of all Congressional and

Governors’ requests to help ensure

accurate and timely responses;

◆ monitoring legislation and attending

Congressional hearings that affect the

Postal Service and the Inspector General

community; and 

◆ coordinating preparation of written and

oral testimony for Congressional hearings

and questions arising from such hearings;

and 

◆ working with Congressional staff

members to address issues as appropriate. 

In addition, OIG keeps the Governors and

Congressional staff members informed about

matters that are referred to the OIG from Postal

Service stakeholders and constituents.

During this six-month period, OIG closed

50 Congressional requests. Appendix A lists

completed OIG responses to Congressional

inquiries by subject area. Some examples of

inquiries where the OIG was able to provide

Congress with independent information are

included below.

◆ The OIG reviewed a complaint from a

customer over the termination of mail

delivery to his residence. The OIG noted

that the customer, without the consent of

the Postal Service, moved his mailbox

from the curb and mounted it on his residence. However, on the customer’s

route, the Postal Service provided curbside delivery only by vehicle. Based

upon the OIG’s recommendation, Postal

Service officials met with the customer

and satisfactorily resolved the issue.

(OIG DS-CR-99-001)

◆ Allegations were made that mail was

being damaged, lost, or misdirected due

to the excessive amount of bulk mail

received. The OIG informed the customer of various options available to

reduce the level of unwanted bulk mail.

The OIG informed this customer that the

Postal Service cannot refuse to deliver

mail if proper postage is paid but that the

customer could contact a direct mail

The following section describes the OIG

and the Inspection Service’s efforts to 

provide Customer Service. Customer 

satisfaction and service is the underlying

creed of most successful organizations and 

businesses. In order to differentiate the

work reported by the OIG and Inspection

Service, the pages concerning the Inspection Service have been color screened.

Report numbers are shown in parentheses

after the narrative, as appropriate.

0-60 Days

61-120 Days

121-240 Days 241-360 Days

361-480 Days

481-600 

Days

601-737

Days

Open /Pending 

Congressional Inquiries 

by Age

18

15

11

6

16

15

8

FINANCIAL 

MANAGEMENT

OTHER

OVERSIGHT

LABOR MANAGEMENT

PERFORMANCE

Closed 

Congressional Inquiries 

by Category

7

8

25

6

4
PAGE37

marketing association to request to be

removed from various mailing lists.

(OIG PA-CR-99-100)

◆ The OIG also reviewed allegations by a

Postal Service employee that he had

been discriminated against because of his

medical restrictions. The OIG found

Postal management had corrected the

error in lost wages. The OIG also contacted the human resources manager

assigned to investigate the Postal Service

employee’s allegations of a hostile work

environment. The manager, after working closely with the Postal Service

employee, resolved all issues. The OIG

contacted the Postal Service employee

who stated that he was presented with an

acceptable permanent job offer. 

(OIG ER-CR-99-006)

HOTLINE OPERATIONS

The OIG Hotline provides a vital and confidential communication link between the OIG

and persons who contact the Hotline. The

Hotline receives complaints from employees,

customers, and the general public. Complaints

include alleged violations of laws, rules, or regulations; mismanagement; waste of funds; abuse

of authority; or danger to public health and safety. Complaints and allegations received by the

Hotline are analyzed to identify systemic issues

affecting the Postal Service.

OIG analysts staff the Hotline Operations

Center from Monday through Friday, 7:00 a.m.

through 7:00 p.m. Eastern Time. With this

Semiannual Report to Congress, the OIG is

issuing its first Hotline poster, which will also be

distributed to all Postal facilities (see exhibit).

During this six-month reporting period,

the Hotline received almost 7,000 contacts. Of

the contacts received: 

◆ Nine percent were referred internally to

OIG staff for resolution or information,

and pertained to allegations of fraud,

waste, abuse, mismanagement, or danger

to health and safety;

◆ Forty-five percent were referred to the

Postal Inspection Service and involved

allegations of criminal activity, including

threats of violence or potential violence,

mail fraud, theft, vandalism, or mail tampering;

◆ Nine percent were customer service matters that were referred directly to the 

Postal Service Consumer Advocate; and

◆ Thirty-seven percent related to 

miscellaneous requests for information

such as job opportunities, ZIP codes,

postal meters, and other Postal Servicerelated matters. 

The OIG’s national toll-free Hotline is 

1-888-USPS-OIG (1-888-877-7644). Persons

interested in contacting the Hotline may also

write to the United States Postal Service, Office

of Inspector General, ATTN: HOTLINE, 1735

North Lynn Street, Arlington, VA 22209-2020.

The e-mail address is hotline@uspsoig.gov and

the fax number is (703) 248-2259.

ANSWERING FREEDOM OF

INFORMATION ACT AND 

PRIVACY ACT REQUESTS

The OIG responds to many requests for

reports and other information made to the OIG

under the Freedom of Information Act and the

Privacy Act. The Freedom of Information Act

requires that the OIG respond to the requestor

within 20 working days. Upon receiving a

request, OIG staff conduct a search of OIG

records to determine whether the OIG has any

responsive documents. The OIG releases most

audit and management advisory reports. Open

criminal investigations are not released and,

generally, only portions of closed criminal

investigations are released.

Because some audit and management advisory reports contain sensitive Postal Service

business information, the OIG asks Postal Service management and the Postal Service Law

Department to identify any business or proprietary information that may be exempted from

disclosure under the Freedom of Information

Act. After reviewing management’s comments,

the OIG makes the final determination as to

whether an exemption is applicable to an OIG

document. 

Often, the OIG receives requests for documents that originate from the Postal Service

and other agencies. In those cases, requestors

are notified that their request is being forwarded to the appropriate agency for determination. 

Requestors have the right to appeal an

OIG determination to withhold all or part of a

document. The appeal is sent to the OIG who

CONSUMER 

ADVOCATE

ASSISTANT 

INSPECTOR GENERAL

CLOSED DIRECTLY BY HOTLINE

INSPECTION SERVICE

Referral of Contacts 

Received by the Hotline

9%

9%

37%

45%

To request information from

OIG, visit our website at

www.uspsoig.gov or contact

Freedom of Information Act

Officer, 1735 N. Lynn Street,

Arlington, VA, 22209-2020.
PAGE38 CUSTOMER SERVICE

of the file except for a few documents. Those

withheld involved attorney-client communications or constituted a clearly unwarranted

invasion of personal privacy and were exempt

from disclosure. In addition, specific documents requested that originated in the Postal

Service were forwarded to the Postal Service

Freedom of Information Act officer for review

and direct response to the constituent. 

(OIG GC-LA-99-001)

MONITORING COMPUTER

MATCHING REQUESTS FOR

POSTAL INFORMATION

The Postal Service receives requests from

other government agencies for Postal data that

are used in computer matching programs for a

variety of purposes, including statistical studies

and law enforcement activities. Pursuant to the

Privacy Act, the Postal Service Data Integrity

Board reviews requests seeking information to

perform computer matches. The Inspector

General is a member of the Data Integrity Board

along with the Vice President, Human

Resources; General Counsel, Executive Vice

President, Human Resources; Chief Financial

Officer and Executive Vice President, Finance;

and the Chief Postal Inspector. During this sixmonth period, the Inspector General acted on

two requests for computer matching data for the

Postal Service.

RESPONDING TO MANAGEMENT

REQUESTS FOR OIG REVIEWS

The OIG provides timely and accurate

information and recommendations to Postal

Service management. The OIG asked Postal

Service managers to identify operations and

emerging issues that would benefit from the

◆ extra trips on highway contr

◆ the Sales Force Augmentati

◆ retail operations; 

◆ National Customer Support 

Center billing processes; and

◆ alternative dispute resolution 

The OIG plans to contin

suggestions from Postal manag

consider all suggestions as it plans 

LEGISLATIVE AND REGU

REVIEW

As required by the Inspector 

the OIG monitors legislative a

developments to advise Congress 

ernors concerning the impact of su

and regulations on the economy, e

the prevention and detection of fr

in programs and operations of th

vice. In prior semiannual reports

significant legislation and regulati

tained in their own separate se

report. As part of our reformat

make this semiannual report easi

have included the relevant legisla

latory reviews at the end of the ap

tions that describe OIG and Inspe

reviews performed during the last 

During this six-month peri

evaluated 71 legislative proposals 

tory initiatives.

reporting fraud, waste and 

abuse is 1-888-USPS-OIG 

(1-888-877-7644). 
PAGE39

The Inspection Service has joined organizations such as the American Association of

Retired Persons in an ambitious series of

national crime prevention initiatives aimed at

alerting senior citizens of fraudulent offers they

may be receiving by mail or telephone.

As a result of complaints of fraud losses

attributable to the criminal use of credit cards

stolen from the mail, the U.S. Postal Inspection

Service formed the credit card mail security task

force. The task force has representatives from

all groups involved in issuing, transporting, and

delivering the one million credit cards that are

sent through the mail each day. The group

includes major credit card issuers, presort businesses, airlines, and various postal entities. As a

result of this effort, fraud losses were reduced by

over 80 percent.

The Postal Inspection Service established

similar joint industry task forces to attack rebate

and mail order fraud. All three customer-based

industries share similar objectives and use civil

and criminal enforcement measures as preventative strategies.

CRIME LABORATORIES

Solving investigations and convicting

criminals often requires the unique support of

scientific and technical personnel assigned to

the Forensic and Technical Services Division.

Forensic analysts at the Postal Inspection Service’s National Forensic Laboratory in Dulles,

Virginia, and four field laboratories provide

expert examinations and testimony on evidence submitted by Postal Inspectors for document, fingerprint, chemical, and physical evidence analysis. Forensic experts are expected to

provide timely results without compromising

scientific methods and accepted protocols. Lab

The Inspection Service’s 

ists provide technical ex

instances of potential m

criminal activities.
PAGE40 CUSTOMER SERVICE
OFFICE OF INSPECTOR GENERAL

Accepting and Processing

Transportation

Delivery

Marketing

Legislative and Regulatory Reviews

INSPECTION SERVICE

Accepting and Processing

Transportation

Delivery

Mail Theft

PAGE 41
PAGE42

evaluators, criminal investigators,

lawyers, technicians, and

administrative personnel from

federal and state government

agencies, private industry,

nonprofit organizations, and

the Postal Service.

PERFORMANCE REVIEWS

OFFICE OF INSPECTOR

GENERAL

To deliver world-class service, businesses

and government agencies must excel in performing their core business processes. For the

Postal Service, these core business processes and

systems encompass accepting, processing, transporting, and delivering the mail as well as marketing Postal products and services. In the past

six months, the OIG has completed 28 reviews

of key and emerging issues relating to the Postal

Service’s performance of core business processes,

that will help the Postal Service save over $1.1

billion during the current and future years. The

reports with the major savings or significant

findings are:

◆ Corporate Call Management, under the

subheading of Marketing, see page 46;

◆ Emergency and Extra Trip Expenditures

on Highway Routes, under the subheading of Transportation, see page 44; 

◆ Rail Detention Costs, under the subheading of Transportation, see page 44; and

◆ Priority Mail Processing Center Network,

under the subheading of Accepting and

Processing, see page 42.

ACCEPTING AND PROCESSING 

Each day, over 650 million pieces of mail

are brought into the Postal Service system in a

variety of ways, including collections from more

than 300,000 blue collection boxes or individual mailboxes via nearly 300,000 letter carriers.

Express Mail, First-Class Mail, and some periodicals are sorted at the more than 300 processing

In an audit of the Priority M

Center Network, the OIG conclu

cessing the same volume of 

through the contracted network c

Service more than the estimate

house processing without a netwo

provided Postal Service managem

ommendations to control costs, ca

and improve performance. Add

OIG recommended that manage

the issues identified in the repo

future expansion of the Priority Pr

work is undertaken.

Management generally agre

specific recommendations in the 

ever, management pointed out th

of opinion remain with OIG on 

findings in the report. In addition

pointed out that because the audit 

ed during the pilot phase of the 

Processing Center Network, man

ings and recommendations in the 

premature. Overall, OIG views 

comments as responsive, and bel

rective actions taken or planned 

intent of OIG’s recommendations

(OIG DA-AR-99-001)

REVENUE RECEIVED FRO

CANADIAN MAILER DEF

BY $572,000

The OIG and the Inspection 

ly investigated a special Priority M

provided to a Canadian mailer. T

tion disclosed that the Postal Ser

Canadian company a discounted 

Priority Mail parcels destined fo

States. The parcels were trucked a

der and entered into the Postal 
PAGE43

SHIPMENTS 

In a review, the OIG evaluated the plantverified drop shipment system, which allows

authorized mailers of Periodicals and Standard

Mail to receive discounts for making drop shipments at postal facilities. The review disclosed

that Postal Service employees did not always

verify the actual shipment quantity with the

amount indicated on customers’ prepared forms

and sometimes accepted mail without receiving

any required forms from the customer. The

OIG informed the Postal Service of the potential for lost revenue and the risk that fraud could

occur. Management agreed with the recommendations and indicated they were in the

process of developing comprehensive drop shipment policies and standards and instructions for

both employees and customers. 

(OIG AC-AR-99-001)

IMPROVEMENTS NEEDED FOR

TIMELY PERIODICALS DELIVERY 

During this period, the OIG issued two

reports on the processing of periodicals. Periodicals mailing generates substantial revenue for

the Postal Service and provides qualified classes

of mailers with an economical method of advertising services, providing association members

with important information, or delivering local

news. 

◆ In one review, the OIG evaluated the

success of the Postal Service Periodicals

Service Improvement Team and the

timeliness of periodicals delivery at three

facilities. The review disclosed that the

team had initiated several efforts to

improve periodicals delivery, and that

Postal facilities had addressed specific

problems with periodical service at the

processing and distribution center. The

review disclosed that the date and time

were not always placed on the periodicals

mail containers, and that this mail was

not processed on a first-in, first-out basis.

The OIG offered suggestions for improving operations, and the actions planned

or taken by management satisfied the

intent of the suggestions. 

(OIG AC-MA-99-002)

GOVERNMENT MAIL 

MISDIRECTED AND DELAYED

The OIG conducted an audit in response

to allegations that federal agencies’ mail handled by the Government Mails Section of a processing and distribution center was misdirected

and delayed. The audit confirmed the allegation and disclosed that not all government

agencies were using assigned unique ZIP Codes

and that mail was not handled according to

established policy. Also, because the processing

and distribution center’s operating plan for processing of mail did not match the delivery

requirements for the Government Mail Section, often mail arrived too late to meet processing and delivery requirements. Additionally, the Government Mails Section incurred

over $200,000 in overtime and penalty costs

over a one-year period due to heavy mail volume and staff shortages. Management generally agreed with OIG recommendations to

improve Government Mail Section operations. 

(OIG DS-AR-99-003) 

PREVENTIVE MAINTENANCE 

SYSTEM REPORTS NOT READILY

AVAILABLE

While conducting an audit of the Equipment Preventive Maintenance Program, the
PAGE44 PERFORMANCE REVIEWS

reports. Management concurred with OIG

observations and suggestions. 

(OIG AC-MA-99-001)

TRANSPORTATION

Transportation of mail is a vital part of the

Postal Service’s mission of binding the nation

together by providing prompt, reliable, and

efficient delivery to every community in the

United States. To fulfill this mission, the Postal

Service spends in excess of $5 billion annually

on transportation services. For most of these

services, the Postal Service relies on private

transportation contractors. In addition to its

contracts with commercial carriers, the Postal

Service operates its own truck fleet for some

routes and manages three dedicated transportation networks for expedited services. During the

past six months, OIG has performed six transportation-related reviews, the most significant

of which are highlighted below.

OVER $130 MILLION SAVINGS

IDENTIFIED ON HIGHWAY

ROUTES 

The OIG conducted an audit to identify

actions the Postal Service can take to reduce

emergency service and extra trip costs on highway routes. Working with management, the

OIG determined that Postal Service could save

over $130 million over a five-year period

through better contract administration and

oversight of highway transportation and extra

trip expenditures. Specifically, audit results

indicated that the Postal Service could save

$24.7 million in FY 2000 and avoid $26.7 million annually in subsequent years through better

administration of emergency contracts and

extra trips. The audit disclosed that Postal Ser

Another audit was initiate

opportunities for savings by dete

rail trailer inventories are mana

trailers were retained significantl

contracted periods. Working w

ment, the OIG identified savings 

$50 million over a five-year period 

tion costs. These savings will re

ommendations that facilities man

use trailers to augment highway tr

store equipment. Management al

sider the detention status of traile

ing dispatch decisions, and seek r

for detention caused by mailers.

Postal Service rail dete

increased from approximately $5 

1995 to over $9 million in FY 199

determined that the data the Post

to manage its detention costs is un

preventing an accurate projection 

bility. Management agreed with 

ings and 10 recommendations 

improve operations. In addition, 

has taken or plans to take the a

mended to substantially reduce 

detention and misuse costs. 

(OIG TR-AR-99-001)

ENVIRONMENTAL RELAT

ISSUES

During this period, the OIG 

environmental related reports.

◆ In the first audit, the OIG e

extent to which compressed 

has been used in Postal Serv

and the process for purchase

the Postal Service’s Alternat

Program. The audit reveale

Postal Service could achieve 

The OIG reviews the Postal Service

operation of its own truck fleet as well

as commercial contract carriers who

move the mail.
PAGE45

◆ In the second review, OIG evaluated the

process for removing regulated fuel

underground storage tanks and found

that this process needed improvement.

The Postal Service made the decision to

install, upgrade, and then remove compliant underground storage tanks without

adequate planning and cost-benefit

analysis, resulting in premature and

unnecessary expenditures of $1.5 million.

The OIG made recommendations to

Postal management to improve the

accuracy of information and to improve

adherence to policy on underground

storage tanks. Management agreed with

the recommendations and has initiatives

in progress and planned to address the

issues in this report. 

(OIG CA-AR-99-002)

◆ The OIG also reviewed an inquiry by a

state official concerning the relocation of

a postal facility in the Northeast. The

inquiry focused on the extent to which

public funds can be used for the relocation, and also focused on potential environmental issues. OIG concluded that

the Postal Service had filed the required

public notice and that the Postal Service

uses operating revenue and does not use

tax dollars as a means to pay for new

facilities. Regarding the environmental

concerns, specifically asbestos, the Postal

Service reached an agreement with a

developer who will assume full environmental compliance responsibility. 

(OIG FA-CR-99-100)

DELIVERY

The mail delivery process provides the

Postal Service with a gateway to every household and business. During 1998, the Postal

the National Change-of-Address Welcome Kit

Program and assessed the industry implications

of including advertisements in the kit. The

audit disclosed that the Welcome Kit Program

emulated good business practices and that

including advertisements in the Welcome Kits

did not adversely impact the advertising industry. However, the audit also disclosed that there

was no evidence to conclude that customer satisfaction had improved. Management agreed

with an OIG recommendation that management include questions related to the Welcome

Kit Program in their customer satisfaction

surveys. (OIG DS-AR-99-002)

MAIL DELIVERY CONCERNS

RAISED

The OIG received multiple inquiries from

customers regarding mail service. Several are

highlighted below.

◆ As a result of a Congressional inquiry,

OIG confirmed that a customer in the

Midwest Area had not received mail for

one week and that Postal Service officials did not adequately respond to the

customer’s complaint. District management concurred with OIG’s suggestion to

implement procedures to document 

customer complaints and follow-up on

unresolved complaints. 

(OIG DS-MA-99-006)

◆ The OIG reviewed a complaint from

another customer over the Postal Service’s denial of a claim for lost contents

of a package. In this case, adequate documentation substantiating the cost of the

package contents was not provided, and

OIG concluded that the Postal Service

acted appropriately in denying the claim.

(OIG DS-CR-99-002)

The OIG reviewed the Nati

Change-of-Address Welcom
PAGE46 PERFORMANCE REVIEWS

IDENTIFIED IN CORPORATE CALL

MANAGEMENT PROGRAM 

During this period, the OIG conducted an

audit of Corporate Call Management, a new

program designed to enhance customer service

within the Postal Service. The OIG reviewed

the Decision Analysis Report model for this

program and found that advances in technology

and changes in call mix would permit the Postal

Service to reduce the original scope of the $3.4

billion program. The OIG was advised that the

Decision Analysis Report was never approved

by the Board of Governors, and the project was

to be phased in over time and was approved on

that basis. At OIG’s suggestion, officials revised

the model and recalculated operating and

investment costs. As a result of the OIG audit,

and management slowing the implementation

process, the Postal Service recognized a potential cost avoidance of $962 million through FY

2007. Management agreed with a recommendation to notify the Board of Governors of the

cost reduction, and agreed to notify them, via

quarterly reports, of future cost reductions as

they are realized. (OIG DA-AR-99-003)

MANAGEMENT ACTION SHOULD

IMPROVE NATIONAL ACCOUNTS

PROGRAM 

The OIG also conducted a review of Postal

Service initiatives to improve the national

accounts program to promote development and

retention of postal business. The OIG noted

that overall, the Postal Service is taking actions

that should improve the national accounts program. However, opportunities exist for program

improvements. The OIG provided management with suggestions concerning use of personnel, mail acceptance and delivery processes,

services during the period, whi

below.

◆ The OIG reviewed the oper

Citizens’ Stamp Advisory C

which is responsible for eval

merits of all stamp proposals 

mending subjects that are bo

ing and educational. The re

closed that Stamp Services m

effectively coordinated overa

of the Committee. However

suggested improvements to e

cohesiveness of the Commit

and to encourage collaborat

Stamp Services managemen

mittee members. Managem

ments were responsive to th

suggestions. (OIG RG-MA

◆ The OIG also initiated a rev

facts and control processes c

printing error that occurred 

production of the 60-cent in

commemorative Grand Can

The review disclosed that ex

trol processes should have pr

sonable assurance that errors 

vented and detected; howev

processes were not followed. 

the recurrence of such errors

suggested that subsequent re

original artwork or text be re

for final approval before pro

authorized. Management ag

results of the review and stat

intent to follow existing con

in the future. (OIG RG-LA

◆ The OIG also conducted a r

response to an allegation tha

vice publications and retail d

in violation of existing statu
PAGE47

The OIG has establis

teams to examine ma

processing, and delive

important because th

Service delivers more 

million pieces of mail 

and handles 41 perce

entire world’s mail vo

the stamp price before making stamp

images available outside the Postal Service. Management agreed in principle

with the OIG observations and suggestions. However, management did not

believe that it was possible to monitor all

outside use. We are working with management to resolve these issues. 

(OIG RG-MA-99-010)

POSTAL SERVICE CANNOT FULLY

EVALUATE EFFECTIVENESS OF

NATIONAL ADVERTISING AND

PROMOTIONAL CAMPAIGNS

The OIG conducted a review of the Postal

Service method of evaluating the effectiveness

of its national advertising and promotional

campaigns. The review disclosed that the

Postal Service’s advertising research contractor,

who was hired to assess the effectiveness of the

Postal Service advertising, was not always able

to do so. This occurred because Postal management did not always notify the contractor of all

upcoming advertising. OIG suggested that the

Postal Service establish a system to provide

timely written notice of upcoming advertising

to the advertising research contractor. Management agreed and included this provision in

the draft statement of work for the new

advertising agency contracts. 

(OIG RG-MA-99-009) 

OPPORTUNITIES TO IMPROVE

RETAIL OPERATIONS 

The OIG conducted several reviews of

retail operations within the Postal Service during this period. The Postal Service has retail

operations located in the 34,000 area, district,

and field offices. Retail operations employs

about 85,000 employees and collects over $15.5

training presentations, reference materials, public image, instructors’ knowledge

of Postal Service products and services,

and overall management and control of

training. Management agreed with OIG

suggestions to improve and strengthen

the program and actions planned or

taken were responsive. 

(OIG RG-MA-99-006)

◆ In another review, the OIG examined

allegations concerning the lack of internal controls over maintenance of self-service postal center vending machines.

The OIG concluded that Postal Service

management could avoid lost revenues if

existing internal controls were stronger.

The OIG offered three suggestions in the

areas of enhancement of supervisor-totechnician ratio, training for non-technical personnel, and guidance to ensure

vending machine audits and revenue

shortage procedures are consistently and

equitably applied. Management comments were responsive to OIG suggestions and corrective actions taken or

planned should add value to the self-service program. (OIG RG-MA-99-001)

LEGISLATIVE AND REGULATORY 

REVIEWS

PROPOSED LEGISLATION

H.R. 22 - Postal Modernization Act of

1999

H.R. 22 would modify the nation’s postal

laws and give the Postal Service statutory

authority to anticipate and respond to rapidly

changing market conditions in an increasingly

competitive industry. The OIG reviewed and

commented on H.R. 22 in the last Semiannual
PAGE48 PERFORMANCE REVIEWS

◆ H.R. 2562  PROSTATE CANCER

RESEARCH

◆ H.R 2730 - GEORGE ‘MICKEY’

LELAND HUNGER RELIEF STAMP

ACT OF 1999

◆ S. 712 - LOOK, LISTEN, AND LIVE

STAMP ACT

These legislative proposals authorize the

sale of semi-postal stamps, providing a fundraising mechanism for various causes by the sale of

stamps at prices above the normal first-class

rate. The difference between the stamp sales

price, less the first-class rate and an amount sufficient to cover reasonable costs incurred by the

Postal Service in printing, selling, and distributing the stamp, would be paid to the benefiting

organization. 

The OIG is concerned about whether the

Postal Service is sufficiently accounting for

costs incurred in the semi-postal stamp program.

The OIG has initiated a review of one such

stamp program—the Breast Cancer Awareness

Stamp. The purpose of the review is to determine whether management controls for revenues, costs, and payments were effective. The

General Accounting Office is reviewing the

appropriateness of the Postal Service as a

fundraising agency and the overall effectiveness

of semi-postal stamps. The OIG has met with

the General Accounting Office to coordinate

these efforts.

These proposed legislative initiatives need

to include adequate Postal Service accounting

provisions.

H.R. 2535 - Postal Service Enhancement Act

This bill would establish the “National

Commission on Postal Efficiency and Enhance

tion, processing, or delivery of m

is currently responsible for perf

tasks. 

H.J.R. 55 - Mailbox Privacy 

Act

This joint resolution express

of the Postal Service’s final rule pu

Federal Register on March 25, 19

commercial mail receiving agenc

requires operators of commercial 

agencies to require applicants for 

provide the same type of informa

Postal Service requires of its mailb

In addition, the rule requires add

mercial mail receiving agencie

“PMB” for “private mail box” i

block. These requirements raised 

cerns with some commercial m

agency customers. The cost as

changing addresses was also a c

OIG will be looking at the data 

used to support this rule and e

need for this rule.

PROPOSED RULES

PRIVATE MAIL BOXES AND 

POST OFFICE BOXES—RELEA

OF INFORMATION

During this period, two rul

lished dealing with private mail b

office boxes. The March 1999 ru

to provide background.

◆ In a March 1999 final rule, a

receiving mail at a commerc

receiving agency was require

plete a form. The form requ

tion regarding the applicant

address, home telephone nu
PAGE49

(Federal Register, Volume 64, Number

110, Pages 30929-30930, June 9, 1999).

◆ Another proposed rule limits the Postal

Service’s disclosure of information about

commercial mail receiving agency or post

office box holders to government agency

requesters or pursuant to subpoena or

court order. (Federal Register, Volume 64,

Number 165, Pages 46630-46632,

August 26, 1999).

These Federal Register publications have

been controversial among users of private mailboxes. The Postal Service has announced that

additional rules regarding private mailboxes will

be proposed. As mentioned earlier under H.J.R.

55, the OIG is planning to conduct work in this

area.
PAGE50

Inspector General in 1996. 

Karla W. Corcoran was hired 

by the Postal Service Governors

and was sworn in as the Postal

Service’s first independent

Inspector General on January 6,

1997. She has a seven-year

appointment in this position.

ACCEPTING AND PROCESSING

Work that the Inspection Service has provided relating to accepting and processing activities at the area, district, and local levels are

highlighted below.

SPECIAL SERVICES, INCLUDING

REGISTERED MAIL, REQUIRED

IMPROVEMENT 

◆ An audit of postal operations in the

Northeast Area to review certified mail,

registered mail, insured mail, and post

office box service. The audit disclosed

that window clerks were not always offering certified, registered, and insured services for mailings that were presented by

postal customers. Registered mail was

not properly handled in accordance with

established regulations and security provided registered mail was not adequate to

prevent loss. Also, improved internal

controls were needed at postal facilities

delivering large volumes of certified mail

to individual businesses and government

agencies. Management concurred with

the findings and began implementation

of recommendations. 

(IS 040-1241887-PA(2))

◆ The Inspection Service completed an

audit of registered mail procedures in the

Northern New Jersey District. The

objective of the audit was to determine if

the District was in compliance with registered mail handling procedures implemented nationwide in 1997. The audit

disclosed noncompliance with procedures

in the areas of security and individual

accountability. Recommendations were

made to use security containers, limit

access to registry areas, and maintain

individual accountability over registered

a coded shipment, and confl

patch procedures existed for 

registered mail. Managemen

with the recommendations.

(IS 312-1275293-PA(3))

AREA PRIORITY MAIL SE

NEEDED IMPROVEMENT

An audit was conducted of 

destined in the Atlanta Metro A

and measure successfulness of loca

improve on-time performance 

inter-area mail flows via the speci

taxi. Audit recommendations inc

service improvement measures, a

utilization of the air taxi load cap

nation of the contract with altern

transportation established. Manag

with audit recommendations and 

mentation. Management forward

air taxi recommendation to He

implementation. (IS 040-127867

SERVICE IMPROVEMENT 

OPPORTUNITIES FOR FIR

MAIL AND OVERNIGHT 

Reviews were conducted at t

and distribution centers and a p

distribution facility within the Lan

mance Cluster. The audit disclose

and three-day First-Class Mail a

mail was not being processed and 

meet service standards at one ce

facility. Management agreed wit

and began implementation of the 

tions. (IS 312-1272877-PA(3))

POLITICAL CAMPAIGN M

DELAYED

The Inspection Service co

audit in response to a request to re

PERFORMANCE REVIEWS
PAGE51

in the Standard Mail (A) staging area, a violation of standard operating procedures. Management agreed to implement the recommendations made to assign one individual the primary

responsibility of ensuring compliance with standard operating procedures. 

(IS 072-1289303-SI(2)) 

TRANSPORTATION

The following reviews are highlights of

Inspection Service work on transportationrelated issues at the area, district, and local levels. 

UNUSED VEHICLES VALUED 

AT $64,000 IDENTIFIED

An audit of vehicle utilization was conducted in the Alabama District to determine if

all delivery vehicles were necessary and utilized

in the most efficient manner, and to ensure data

integrity and system reliability of the Vehicle

Management Accounting System. Recommendations were made to re-deploy or salvage

unused vehicles, train managers to ensure accuracy of the Automated Vehicle Utilization System, and assign manager accountability for

review and analysis of system entries and

reports. Management agreed with the audit

recommendations and took immediate action

to implement their plan, including an 

agreement to save $64,000 through redeployment/salvage of unused vehicles.

(IS 045-1291771-PA(2))

HUB AND SPOKE PROJECT

OPERATIONS REQUIRE 

ATTENTION

An audit of the Hub and Spoke Project

operations was conducted in the New York

Metro Area to ensure that mail was processed

efficiently and dispatched timely, and to ensure

◆ implementation of proper color coding

and handling of registered mail; and 

◆ improvement in the accuracy and

monitoring of Management 

Operating Data System reports.

Management agreed to implement all

recommendations with the exception of the

Hub and Spoke Project consolidation.

(IS 039-1279813-PA(2))

AIR ROUTE CHANGES 

RECOMMENDED TO IMPROVE

TIMELY SERVICE

At the request of a Postal official, the

Inspection Service audited the implementation

of a revised air routing procedure for San Juan

origination and destination First-Class Mail.

Both the Postal Service and the air carriers were

included in the review. The review was conducted to ensure that inbound and outbound

routing was in compliance with new air routing

directives, and the San Juan, Puerto Rico, Airport Mail Center airline service and inbound

mail processing provided a timely receipt of

mail. The review concluded that the air routing changes would assist in improving the service to and from San Juan. To achieve successful implementation, the report recommended

continued management oversight to ensure all

origins properly route their mail, air carriers

provide the required service, and the San Juan

Airport Mail Center processes the mail in a

timely manner. (IS 071-1273763-SI (2))

DELIVERY

Delivery-related reviews conducted by the

Inspection Service at the area, district, and local

levels are highlighted in the following section.
PAGE52

(IS 071-1289438-SI(2))

USE OF DELIVERY POINT

SEQUENCING NOT OPTIMIZED

The Inspection Service conducted an audit

of Delivery Point Sequencing within the Southeast Area. The objectives of the audit were to

evaluate utilization and deployment of Delivery

Bar Code Sorters and Carrier Sequence Bar

Code Sorters, determine potential for adding

routes to Delivery Point Sequencing, and identify ways to increase sequencing volume. Audit

recommendations included the establishment

of a formal process to share strategies to increase

Delivery Point Sequencing with all districts and

plants, and re-deployment of equipment to rural

areas to add rural routes into Delivery Point

Sequencing. Management agreed with audit

recommendations and began implementation. 

(IS 041-1292192-PA(2))

MAIL THEFT

Postal Inspectors are committed to reducing mail theft to maintain the public’s confidence in the Postal Service and preserve the

sanctity of the mail. Postal Inspectors are currently working with major mailers to prevent

mail theft and related problems. Mail losses

attributed to the Postal Service are often the

consequences of actions taken by one of its business “partners.” These actions may occur at

some point in the process of mail acceptance,

processing, transportation, or delivery. During

this reporting period, Postal Inspectors made

2,462 arrests and obtained 2,389 convictions

related to mail thefts. The following are examples of significant reviews reported during this

semiannual reporting period.

revealed that a bank courier 

trays of mail intended for th

bank was a clearinghouse us

businesses to deposit checks

contained more than 3,000 

letters and checks valued at 

million. 

◆ Inspectors arrested an indivi

sible for extensive losses in t

cisco area. He was a locksm

puter technician who used c

postal keys to steal mail from 

boxes. He used computer te

make driver’s licenses and so

make counterfeit checks. A

arrest, he admitted stealing m

every day and night.

◆ Based on an undercover ope

inspectors arrested a ground 

the Los Angeles Airport wh

ing Treasury checks, with kn

$112,000, from the mail.

◆ Fourteen individuals were ar

indicted on 22 counts in Tam

federal court. They were pa

ring that stole checks and pe

ing information from the ma

were estimated at $500,000.

Postal Inspectors examine the mail

to assure the integrity and safety 

of the mail system, identify lost 

revenues, and maintain effective 

customer service. 

PERFORMANCE REVIEWS
OFFICE OF INSPECTOR GENERAL

Financial Related Reviews

Financial Data Processing Systems

Contracting and Facilities

Legislative and Regulatory Reviews

INSPECTION SERVICE

Financial Installation

District Accounting Offices

Contracts and Facilities 

Revenue Investigations 

Embezzlements

Workers’ Compensation 

PAGE 53
PAGE54 FINANCIAL MANAGEMENT REVIEWS

OFFICE OF INSPECTOR

GENERAL

The Postal Service is a $62 billion business

that relies on strong financial management

controls to maximize revenue and minimize

costs. In the past six months, the OIG has

completed 33 reviews in the financial management area, comprised of financial related,

financial data processing systems, and

contracting and facilities reviews. In addition,

the OIG has conducted investigations that have

resulted in five convictions, five arrests, and

investigative recoveries and restitution of over

$2 million. These reviews add value by identifying opportunities for cost savings and by

improving financial management, contracting,

and facilities practices.

FINANCIAL RELATED REVIEWS

Financial related audits are reviews of areas

that have significant financial implications and

offer the potential to save Postal resources. The

OIG has taken a proactive approach to identify

areas that offer potential cost saving and

improve Postal operations. During this semiannual period, the OIG completed 13 reviews in

areas such as Dinero Seguro and the Bank

Secrecy Act.

NO SIGNIFICANT BUSINESS

RISKS ASSOCIATED WITH

DINERO SEGURO PROGRAM

In response to Congressional concerns

relating to a recent indictment of the Postal

Service’s Mexican wire transfer banking partner,

an OIG audit was conducted to determine if the

Postal Service Dinero Seguro money transfer

program was at risk for money laundering. The

◆ delay expanding the program 

Postal Service fully impleme

Bank Secrecy Act requireme

◆ coordinate with the Postal S

Secrecy Act compliance offi

implementing new postal pr

◆ implement controls to furth

the risk of money laundering 

program; 

◆ provide program related syst

to supervisors and postal cle

◆ lower the daily transaction t

from $3,000 to $2,000;

◆ establish controls to ensure t

intended recipients receive t

providing acceptable identif

◆ provide training to bank em

on the various types of Unit

passports. (OIG FR-AR-99-

REVIEW OF DINERO SEG

PROGRAM UNCOVERS

PREVIOUSLY UNDETECTE

MONEY LAUNDERING S

During the audit of the D

Program, OIG personnel, using 

computer analysis techniques, re

than 500,000 transactions to iden

activity. The review identified a 

cious transactions by one sender. 

joint investigation by the OIG an

al law enforcement agencies tha

scheme involving drug trafficke

Dinero Seguro money transfer pr

drug proceeds from the United S

co. As of September 30, 1999, fiv

made for money laundering violat

tion, 25 kilograms of marijuana a

grams of cocaine were seized.

OIG investigators practice defensive

tactics.
◆ consider appointing a full-time compliance officer to facilitate Bank Secrecy

Act system implementation; and

◆ establish standard operating procedures

and a formalized agreement with Mexico

regarding the Postal Service’s Bank

Secrecy Act Program.

(OIG FR-AR-99-007)

FINANCIAL OPINION WORK

CONTINUING

The OIG continued to partner with the

Inspection Service in conducting financial

opinion audits at three accounting service centers and the Headquarters. These audits support

the independent public accounting firm’s overall opinion of the Postal Service financial statements. The results of the adjustments will be

reported in the next Semiannual Report to

Congress. These FY 1999 statements are the

first statements where the lead has transferred

from the Inspection Service to the OIG. In

addition, the OIG served as co-contracting

officer’s representative with Postal Service

Finance in overseeing work performed by the

independent public accounting firm.

DOCUMENTATION NEEDED TO

SUPPORT COST AND PURPOSE

OF INTERNATIONAL TRAVEL 

International travel costs were over $2 million during FY 1999. An OIG review disclosed

that 98 percent of the international travel

requests submitted by Postal Service officials

were incomplete. Specifically:

◆ 94 percent did not include supporting

documents, such as a justification for

the trip needed to ensure that the trip

was directly related to Postal Service

business; and

COMPANIES SURVEYED 

The Postal Service has adopted a private

sector practice of giving mementos to employees attending conferences, meetings, or training

events in order to promote morale and enhance

loyalty to the organization. These mementos

include such items as tote bags, commemorative

pins, and travel clocks. An OIG review determined that the Postal Service was authorized to

give such mementos. However, the review disclosed that the Postal Service’s practices were

inconsistent with those of ten Fortune 500 corporations surveyed. Postal officials provided

mementos, valued at about $300,000, to

employees at 13 of 22 events reviewed, with the

average value of mementos per person ranging

from $22 to $98 per event. In contrast, mementos, when given by the corporations we surveyed, averaged from $10 to $25 per person.

Postal management concurred with the OIG

suggestions. (OIG FR-MA-99-003)

FINANCIAL DATA PROCESSING 

SYSTEMS REVIEWS

As part of the FY 1999 financial statement

audit, OIG conducted four audits to evaluate

general controls over computer-based systems,

including software, data, personnel, physical

security, and information systems security at the

Postal Service’s San Mateo, Minneapolis, and

St. Louis Information Service Centers.

Computer-Based Systems at the 

San Mateo Information Service Center

Required Improvement 

General controls over computer-based systems at the San Mateo Center needed improvement in the areas of access control over restricted areas, procurement, sale and control over

computer tapes, and use of sensitive and

PAGE55
PAGE56

Postal Service?

The Postal Service processes over

900,000 money orders on a daily

basis, with a face value totaling

approximately $115 million. As

part of OIG’s financial management reviews, OIG performs periodic tests and audits of this area. 

FINANCIAL MANAGEMENT REVIEWS

Several Computer-Based Systems Areas

Needed Improvement at the Minneapolis Information Service Center 

Controls were generally adequate over

information systems security and software at the

Minneapolis Center. However, several areas

needed improvement including limiting access

to the mainframe, reviewing security activity

reports, correcting previously reported application change control issues, using unique change

control identifiers, and updating user access

controls for the local area network. Postal management’s comments, including corrective

actions taken or planned, were generally

responsive to the OIG report. 

(OIG FR-AR-99-009)

Several Computer-Based Systems Areas

Needed Improvement at the St. Louis

Information Service Center 

General controls over software, data, personnel, and physical security at the St. Louis

Center were generally adequate. However, several areas needed improvement including assessment of the fire suppression system, local area

network security, and disaster recovery plans.

Postal management’s comments, including corrective actions taken or planned, were generally

responsive to the OIG report. In a separate

review, OIG noted that the money order branch

at the St. Louis Center did not ensure that all

money order edit codes were reviewed and, if

necessary, corrected. Postal management

agreed that the edit code status logs previously

cited would be updated to reflect current status.

In addition, Postal management agreed to assign

responsibility for reviewing and resolving issues

arising from the quarterly report of money order

edit code activity. (OIG FR-AR-99-010 and

OIG FR-FA-99-001)

nual period, we conducted 16 revi

audits and investigations, of co

facilities-related issues. In addit

over 190 open criminal investigat

which are targeting fraud and 

these areas. The most significan

and facilities reviews are highligh

$2.2 MILLION PAID TO 

CONSTRUCTION CONTR

WITHOUT SUPPORTING 

DOCUMENTATION

An OIG audit determined th

Service had contract administrati

in place to assist contracting offic

tives in administering construct

but that these procedures were n

lowed and they needed to be imp

areas. The audit found over $103

payments and $2.2 million in 

materials, which Postal Service 

not validate that they had receiv

$2.2 million also may be an overp

result of the audit, Postal Service 

agreed with the OIG recomm

recover payments as appropriate 

ment improved contracting offic

tive procedures and controls. 

(OIG CA-AR-99-003)

CONTRACTOR AND EMP

SENTENCED FOR MAKIN

STATEMENTS

An OIG investigation disc

scheme involving a contractor ce

had paid its employees in accord

wage rate specified in its contr

Postal Service. In fact, the cont

employees less than the wage rat

tract. Three contractor personnel 

federal court to making false statem
PAGE57

(OIG 016-98-RI-040-RP000)

CONTRACTORS 

RECOMMENDED FOR 

SUSPENSION OR DEBARMENT 

Based on the findings of three investigations, the OIG recommended that Postal management debar or suspend the following contractors. 

◆ An OIG investigation revealed that a

cleaning service contractor paid a Postal

Service supervisor $1,200 to ensure continuation of a month-to-month contract

to clean the post office. As a result, the

contractor was debarred after being

found guilty of bribery of a public official.

(OIG 98-RI-040-RP000) 

◆ The OIG recommended that a New Jersey contractor be suspended from contracting activities after the company

president was arrested on mail and wire

fraud charges and for submitting misleading documents in an attempt to secure

over $20 million in U.S. Government

contracts. The OIG also recommended

debarment if the contractor is found

guilty of the charges. 

(OIG 98-RI-014-CA000)

◆ Based on a Congressional complaint, the

OIG found that a contractor breached

the terms and conditions of its contract

and failed to adhere to generally acceptable construction and quality control

practices. The OIG recommended 

that the contractor be suspended and

debarred along with its subsidiary

companies. (OIG 99-RI-043-FA000)

dation to report unused space, but suggested

that options to use the remaining space should

not be pursued until after a potential partnership with another firm is evaluated. 

(OIG FA-MA-99-001)

IMPROVED ADMINISTRATION 

OF CONTRACTS NEEDED

Two OIG reviews identified needs for

enhanced contract administration over Postal

Service vehicle maintenance and construction

contracts.

◆ The OIG conducted a review of vehicle

maintenance contracts at one vehicle

maintenance facility and identified concerns about monitoring work performed

by the contractor. The OIG offered

Postal management two suggestions to

increase efficiency and enhance quality

assurance. Management agreed to

strengthen quality assurance procedures

to ensure that contractors properly performed maintenance service on Postal

vehicles. (OIG CA-MA-99-001)

◆ An OIG investigation revealed that due

to poor training of contract administrators on Postal Service regulations and

building specifications, the Postal Service

paid approximately $370,000 to correct

defective work. Postal Service management agreed with the OIG suggestion to

provide training for contract facility project managers who are not familiar with

Postal Service policies regarding contract

administration, performance, and compliance issues. Training for contract

administrators should help protect Postal

Service assets and programs from fraud,

waste, and abuse. 

(OIG FA-LA-99-002)
PAGE58

Efficiency or the Executive

Council on Integrity and Efficiency?

The Inspector General is a 

member of the Executive Council

on Integrity and Efficiency.

Inspectors General, who are

appointed by the President, are

members of the President’s

Council on Integrity and

Efficiency. Those appointed by

their agency heads, as is the

Postal Service Inspector General,

are members of the Executive

Council on Integrity and

Efficiency. 

FINANCIAL MANAGEMENT REVIEWS

before the Postal Service can take action

involving relocating, closing, consolidating, or

constructing a facility. The legislation permits

individuals and downtown communities the

opportunity to offer alternatives to Postal Service facilities proposals. In its future planning

process, the OIG will consider reviewing the

impact of the legislation, if enacted on the

Postal Service.

H.R. 1859 - Postal Rate Transition Act

If this bill becomes law, the Postal Service,

before implementing a postage rate increase,

would have to report the number of stamps

needed at the differential rate for a 30-day period following rate implementation. For example,

this would be the number of one cent stamps

needed when the Postal Service raised its rates

from 32 cents to 33 cents for First-Class Mail.

This bill would place an additional reporting

requirement on the Postal Service.

H.R. 198 - Postal Service Core 

Business Act of 1999

This bill would prohibit the Postal Service

from offering services provided by the private

sector except for those services that were already

offered nationwide by the Postal Service as of

January 1, 1994. In recent years, the Postal Service has been expanding the services it offers to

its customers. This has resulted in increased

convenience for postal customers and additional revenue for the Postal Service. If H.R. 198

becomes law, any services that began after January 1, 1994, would have to be eliminated. Since

September 1996, the retail merchandise program has generated revenues of $90.8 million

and yielded a profit of $14.1 million. Enactment of H.R. 198 and the elimination of these

programs could result in decreased revenue for 

The Postal Service has notif

that it will collect and maintain 

including social security numbe

chasers of money orders, wire 

stored value cards when the dol

cash purchases totals $3,000 or m

provides that multiple purchase

business day totaling $3,000 or m

treated as one purchase. Postal Se

ees must obtain customer inform

multiple purchases. The OIG duri

reporting period has reviewed P

compliance with the Bank Secrec

tional reviews regarding complia

Bank Secrecy Act are expected. 

ter, Volume 64, Number 146, 

41477, July 30, 1999)

Contractors and Potential Co

of the Postal Service-Notice 

System of Privacy Act Recor

The Postal Service has notif

that it will collect and maintain 

about individuals and small bu

who have expressed an interes

entered into contracts with the P

Records in this system that mentio

individuals consist primarily of 

commercial information. Howeve

records in the system that pertain 

may reflect personal information

address or social security number. 

consider reviewing Postal Servic

in maintaining this system of rec

dance with the Privacy Act. Ad

OIG may obtain such informatio

ducting reviews. (Federal Registe

Number 127, Pages 36051-36052
PAGE59

Computer hacking o

someone within or o

Postal Service illegal

gain entry into the P

computer systems. 

Computer Intrusion 

action to detect and i

hacking attempts.

The purpose of these audits is to review the adequacy of internal controls at the installation

level. Some of the more significant audits are

summarized below.

◆ A financial installation audit at the Dallas, TX, Post Office resulted in eight

findings in the areas of Periodicals, Official Mail Accounting System manifest

mailings, Business Reply Mail Stamp

Distribution Office, Stamp Destruction

Committee, Postal Retail Store, and station operations. Inadequate internal

controls, management’s failure to assure

verification of mailings and prompt collection of revenue resulted in deficiencies of nearly $380,000 in Periodicals,

Official Mail Accounting System, manifest mailings, and Business Reply Mail.

Two of the eight findings had been previously reported in the 1996 Dallas financial audit. Management agreed with the

findings and recommendations and provided an action plan to take corrective

action. (IS 011-1257699-AF(1))

◆ A financial installation audit of the St.

Louis, MO, Post Office resulted in six

findings and the identification of over

$250,000 in revenue deficiencies. Management agreed with the recommendations to strengthen internal controls in

the areas of bulk mail entry, detached

mail units, periodicals, stamp accountability, Postage Due/Business Reply Mail,

trust, and suspense. 

(IS 011-1257197-AF(1))

◆ A financial installation audit at the San

Luis Obispo, CA, Post Office resulted in

two findings in the areas of Postage

Due/Business Reply Mail and office

accountability. Business Reply Mail

identification of over $100,000 in revenue deficiencies. Seven findings contained internal control deficiencies that

had been reported in prior years’ financial audits. In addition, a $33,000 revenue deficiency was identified in unpaid

caller service fees and a $4,800 deficiency was identified in unpaid Business

Reply Mail fees. Furthermore, a potential $61,000 revenue deficiency was identified in the Postage Validation Imprinter

and Official Mail Accounting System

and postage meter records. 

(IS 011-1256147-AF(1))

◆ A financial installation audit at Baltimore, MD, Post Office resulted in seven

findings in the areas of post office

box/caller service, business reply mail,

business mail entry unit, cash management, contract unit administration, collect on delivery mail and main office

window service administration. Continuing weaknesses in the assessment of

business reply mail annual fees and the

administration of post office box and

caller service operations has resulted in

the identification of revenue deficiencies

totaling $20,500 for uncollected business

reply mail fees and over $50,000 for

delinquent box and caller fees. Additional deficiencies totaling over $46,000

were identified with respect to unentered periodical mailing statements

and uncollected annual fees. Management agreed with the recommendations

to strengthen internal controls as presented in the findings and provided

action plans to take corrective action.

(IS 012-1257164-AF(1))
PAGE60

inclusion of telephone number;

◆ notification of suspected or known 

fraudulent transaction;

◆ notification when multiple unpaid 

checks are returned; and

◆ disallowance of Liberty Cash Cards 

for money order purchases. 

(IS 037-1285447-PA(2))

DISTRICT ACCOUNTING OFFICES

The Inspection Service conducts District

Accounting Office audits to evaluate accounting controls as a supplement to financial installation audits. During this period the Inspection

Service issued 17 reports related to district

accounting office issues. The two recurring

issues typically surfaced by the Postal Inspectors

in these reviews centered around meter revenue

verifications and reconciliation of meter records

with the standard field accounting system.

CONTRACTING AND FACILITIES

The Inspections Service conducts preaward and post-award contract audits to ensure

efficiency, effectiveness, and economy in the

procurement process. These audits cover defective pricing and procedural compliance.

◆ The Inspection Service completed a contract audit of a firm fixed-price proposal

submitted by a contractor for services

related to Mail Transportation Equipment Service Centers. The proposal

totaled approximately $45.8 million for

the operation of mail transportation

equipment service centers located in

Greensboro, NC. In addition, the contractor submitted costs in support of a

cost plus fixed-fee proposal requirement

for Process Development Support Services/Testing. These support services

$27.5 million for the Mail C

tem Pre-Production. The au

$4.8 million in questioned c

to labor, other direct costs, o

installation, post general an

tive costs, materials, warran

The audit also identified $8

unsupported costs related to 

materials, and profit. 

(IS 181-12935363-AC(1))

◆ The Inspection Service com

audit of a $24.7 million firm 

proposal submitted by a con

the Forwarding Control Sys

The audit identified approx

million in questioned costs a

mately $2.9 million in unsu

The questioned costs related 

materials, an installation sub

and warranty. The unsuppo

related to subcontract costs 

ted directly to the contracto

contract costs are being sepa

ated by Contract Pricing, Pu

(IS 181-1278136-AC(1))

◆ The Inspection Service com

audit of a $4.9 million firm 

proposal for the Identificatio

Sort—Multiple Position Bar 

Upgrade Kit. The audit rep

over $417,000 in questioned 

to other direct costs, materi

and administration, and war

The audit also identified ne

lion in unsupported costs. T

ported costs include $3.3 m

materials. The contractor d

vide adequate support docum

production materials. 

(IS 181-1289630-AC(1))

FINANCIAL MANAGEMENT REVIEWS
PAGE61

(IS 183-1278298-AC(1))

◆ The Inspection Service completed an

audit of a proposal for approximately

$3.2 million submitted for the development and implementation of a training

program for the employees of the 21 Mail

Transport Equipment Service Centers.

The audit identified over $180,000 in

questioned costs related to labor, equipment, and general and administrative

costs. The audit identified over

$711,000 in unsupported costs related to

equipment, overhead, other direct costs,

and general and administrative costs. 

(IS 181-1226912-AC(1))

FACILITIES AUDITS

The Inspection Service has responsibility

for new construction or leasing activity with an

estimated cost of $5 million and below. During

this period the Inspection Service completed

five facility audits, one of which is highlighted

below. 

◆ Based on the results of a December 1998

audit, the Inspection Service initiated a

national audit of facility projects funded

and approved within the $5 million area

approval level. The purpose of the audit

was to review internal controls and

determine if processes utilized on area

level facility projects were appropriate

and in compliance with Postal Service

policies and procedures. The report concluded that efforts were made to keep

project costs within the $5 million

approval authority of the Area Vice President on six projects in the MidAtlantic, New York Metro, Southwest,

and Western Areas. In an effort to

maintain control and avoid perceived

The Inspection Service conducts revenue

investigations to help ensure that Postal Service

revenue is properly assessed and collected. Priority is given to investigating alleged schemes to

avoid payment of postage and to identify, pursue, and seek actions against violators through

civil, administrative, and criminal remedies.

◆ In a report to the New York District Manager, inspectors recapped the results of an

ongoing criminal action against former

employees of the largest presort bureau in

the State of New York. The United

States Attorney’s Office for the Southern

District of New York had earlier

announced a 44-count racketeering

indictment of three former owners and

seven former managers. Two additional

managers subsequently pled guilty to similar charges. The government alleges that

the company is responsible for defrauding

the Postal Service of more than $24 million. The new company owner has placed

all 10 employees in a leave without pay

status. (IS 064-1290375-RI(1) and

IS 924-1191764-RI(1))

◆ An investigation by inspectors in

Philadelphia led to a $22 million civil

settlement with a major printer of catalogs and magazines. Inspectors, acting

on a tip, found evidence that the mailer

knowingly underreported additional perpiece charges that were due the Postal

Service. The mailer represented to the

Postal Service that its mail was properly

presorted so as to claim the full extent of

presorted mail discounts available. The

underreporting of postage took place at

several of the mailer’s plants throughout

the country. (IS 920-1207670-RI(1) and

IS 069-1296866-RI(1)) 
PAGE62

The civil action is based on evidence

that the for-profit company knew, or

should have known, that the mailings

were in violation of Postal regulations.

(IS 062-1201749-RI(1))

◆ An investigation into a metered postage

scheme resulted in guilty pleas of three

defendants who ran a presort bureau in

the Kansas City, MO, area. The company owner and the plant supervisor

manipulated a postage meter and caused

it to produce over $1 million in unpaid

postage. Both the owner and supervisor

are facing prison terms at a sentencing

hearing. The third defendant, was sentenced to probation and restitution.

Inspectors documented the investigation

in a report to local postal officials earlier

this year. (IS-388-1183443-RI(1))

◆ Inspectors reported the results of an

investigation into an underpayment of

postage scheme carried out by a North

Carolina presort bureau. The investigation revealed that the mailer routinely

understated a portion of the mail requiring additional postage. Loss to the

Postal Service was about $11,000 per

week. It is estimated that the scheme

was in operation for at least three years.

In June 1999, a civil agreement between

the mailer and the U.S. Attorney’s

Office was signed. The mailer agreed to

pay the Postal Service $750,000 over a

5-year period. The first payment of

$150,000 was received in June 1999. 

(IS 924-1170790-RI(1))

◆ Inspectors identified numerous mailings

presented by a third-party mailer claiming unqualified discounts. Analysis

showed that the mail was not presorted

to the extent claimed. Inspectors esti

their jurisdiction as to the e

other similar, unauthorized 

between mailers and bulk m

units. Management agreed 

mented corrective action. 

(IS 064-1290439-RI(1))

EMBEZZLEMENTS

Embezzlement is appropria

fraudulently for one’s own use. 

Postal Service, embezzlements in

money from cash drawers by Pos

contractor employees; kiting sche

Postal money orders or falsif

records; and the theft of merc

retail stores. 

Inspection Service investiga

in the following:

◆ A former customer service m

New York City was sentenc

years of prison and another 

probation for misappropriat

$133,000 in Postal funds.

◆ A window clerk in Massach

sentenced to six months in 

house, six months home det

years probation and restituti

$150, 000. The investigatio

Inspectors revealed that the 

ulated records of money rec

tomer postage meters.

◆ A window technician in Flo

arrested for embezzling more 

$97,000. The technician m

records of postage-due funds 

WORKERS’ COMPENSA

The Inspection Service inve

ulent claims and receipt of benef

ual employees. Unlike other fed

FINANCIAL MANAGEMENT REVIEWS
PAGE63

investigation, potential cost savings to

the Postal Service is over $934,000.

◆ As a result of an Inspection Service

investigation, a mail handler was sentenced to one year incarceration, followed by three years probation for

defrauding the workers’ compensation

program by claiming disability. In addition, the mail handler was ordered to pay

restitution of over $29,000. The conviction resulted in the termination of workers’ compensation benefits with future

cost savings to the Postal Service of

$780,000.

◆ An Inspection Service investigation disclosed that a former clerk in Georgia was

receiving workers’ compensation benefits

while employed by the U.S. Air Force.

The clerk continued to file claims to the

Department of Labor. The Postal

Inspectors’ investigation also showed

that the alleged on-the-job injuries were

the result of an off-duty accident. The

clerk was sentenced to 18 months in

prison, followed by three years probation

and was ordered to pay restitution of

over $32,000. This action resulted in

potential cost savings to the Postal Service of over $610,000.

◆ As a result of an Inspection Service

investigation, workers’ compensation

benefits were terminated for a former letter carrier who fraudulently alleged a disabling back and shoulder injury. The

carrier was sentenced to three years probation and was ordered to pay restitution

of over $4,000. Postal Inspectors produced videotapes of the carrier lifting

and delivering telephone books weighing

over 40 pounds. This action resulted in
PAGE64 FINANCIAL MANAGEMENT REVIEWS
OFFICE OF INSPECTOR GENERAL

Y2K Issues 

Developmental

Computer Security

Information Systems

Electronic Commerce

Legislative and Regulatory Reviews

INSPECTION SERVICE

Electronic Commerce

PAGE 65
PAGE66 TECHNOLOGY REVIEWS

OFFICE OF INSPECTOR

GENERAL

Through technology, the Postal Service is

able to deliver more than 650 million pieces of

mail every day, and maintain its network of over

38,000 post offices and facilities. The Postal

Service recognizes that technology is key to

future growth and, therefore, its technology

strategy is to provide convenient access to all

concerned on a daily basis through increasingly

sophisticated retail systems, expansion into new

electronic access channels, and electronic linkages that integrate customer and postal processes. The OIG technology reviews encompass the

Y2K initiative, information systems, information technology infrastructure, developmental

systems, telecommunications, and computer

security. During this period, the OIG performed

12 reviews in the technology area. 

YEAR 2000 (Y2K) ISSUES

The Postal Service recognizes that technology is critical to its future and has invested heavily in Y2K preparedness. The OIG provided

timely audit support by evaluating ongoing Y2K

efforts to identify issues and recommend corrective actions. The OIG completed five reviews

during the reporting period that address Y2K

preparedness.

Y2K PLANNING PROGRESS

NOTED BUT CHALLENGES

REMAIN

An audit on the status and quality of the

Postal Service’s Y2K business continuity, contingency, and recovery management efforts

showed that management took positive steps to

mitigate Y2K disruptions. However, the OIG

Y2K CONTRACT ADMIN

TION REQUIRES STRENG

ING 

Postal Service management 

examine opportunities to save res

ated with the Y2K initiative. Duri

it was noted that adequate cont

always in place to monitor contra

information to control Y2K reso

always provided, and contractors d

provide timely or adequate work p

OIG also noted concerns with un

ers of contractor management, s

ance documentation that was no

mitted in a timely fashion, and de

Postal Service travel regulations g

contractor. In addition, corre

implemented or planned by 

should provide opportunities to s

Management concurred with seve

gestions for opportunities to save r

unresolved suggestion will be furt

after the audit resolution process 

ed. (OIG FR-MA-99-002)

PROGRESS MADE ON Y

READINESS 

OIG has issued several s

including one during this six-mon

Postal Service Y2K readiness. Ove

disclosed that considerable progr

on Y2K readiness, but much wo

The Postal Service demonstrate

progress in addressing severe and 

mation systems, information tech

structure, processing equip

exchanges, and supplier readine

the OIG found varying levels o

OIG staff observes data input during

Y2K test of a Small Parcel and

Bundle Sorter.
PAGE67

ing to monitor progress based on baseline

performance in assessing the status of Y2K

readiness. (OIG IS-AR-99-002)

DEVELOPMENTAL REVIEWS

The Postal Service is developing numerous

business systems that will improve performance,

enhance service, and reduce operating costs.

The OIG understands the importance of

reviewing these systems as they are developed,

and has completed three audits of major systems

currently under development during the

reporting period. 

POINT OF SERVICE (POS) ONE

DEPLOYMENT AND CONTRACT

CONCERNS

The POS ONE system will replace the outdated retail terminals at the post office retail

windows. The OIG issued two reports on the

system during this period.

◆ The OIG concluded that the POS ONE

project is needed to keep the Postal Service competitive and provide necessary

information for management. However,

deployment of the system caused additional costs to the Postal Service and did

not fully attain desired results or realize

expected benefits. Ongoing hardware

and software problems contributed to

increases in accounting adjustments and

window clerk work hours. As a result,

deployment has been more costly than

anticipated and all of the benefits of the

POS ONE system envisioned by management have not been achieved. The OIG

made six recommendations to improve

monitoring and controls over the system

to enhance accountability, quality, and

performance. Management generally

agreed with the findings and recommen

nation. (OIG DA-LA-99-004)

TRAY MANAGEMENT SOFTWARE

CONTROLS REQUIRE ATTENTION 

The Tray Management System automates

the movement and staging of mail between

most mail sorting operations in a processing

plant. As part of an ongoing audit of the Tray

Management System, the OIG observed Y2K

compliance testing for Tray Management System contractors and whether the project was

meeting performance and cost goals. During

the compliance tests, the OIG review disclosed

that contractors had not satisfied all contract

requirements. Specifically, only one of three

contractors delivered a software configuration

management plan and the only contractor

required to provide an object code comparison

program (a comparison of the operating site

software to the latest approved software release)

did not supply the deliverable by the specified

contract date. 

The OIG suggested that management

work with contractors to ensure timely delivery

and adherence to both a software configuration

management plan and an object code comparison program. The OIG also suggested that management ensure that sufficient resources are

dedicated to software issues, procedures are

developed to track software versions, and

deployed software is identical to software tested

and certified as Y2K compliant. Management

comments were responsive to the software

issues, and actions being taken should strengthen software management overall. 

(OIG DA-MA-99-002)

The Tray Management Sys

was reviewed by the OIG 

critical advancement in au

mail processing.

The OIG is reviewing new 

Service terminals that ha

installed nationwide in ov

offices.
PAGE68 TECHNOLOGY REVIEWS

significant weaknesses. The OIG made

the Senior Vice President and Chief

Technology Officer aware of the consultant’s recommendations, and suggested

that the consultant review the reports

and determine what actions should be

taken to address their recommendations.

The Senior Vice President agreed to

review the reports and inform the OIG of

the corrective actions to be taken. The

suggested that management 

all Postal Service computers 

ly show the approved warnin

part of the log-on process. M

concurred with OIG observa

suggestions and have planne

actions to ensure that all Po

computer users see the appro

banner at each log-on occur

(OIG CI-MA-99-001)

WARNING!

This is a United States Government computer system. Use of this system is authorized

only in accordance with Postal Service policies. Unauthorized access is prohibited.

YOU HAVE NO EXPECTATION OF PRIVACY

USING THIS SYSTEM.

In order to ensure compliance with applicable federal law and Postal Service policies,

all uses of this system may be monitored, read, captured, recorded or copied in any

manner and disclosed in any manner, by authorized personnel. There is no right to privacy on this system. System personnel may give to law enforcement personnel any

potential evidence of a crime found on this system. Use of this system by any user,

authorized or unauthorized, constitutes consent to this monitoring, interception,

recording, reading, capturing, copying and disclosure.

All communications are are to be in accordance with Postal Service policies and regulations. Non-compliance with any of these conditions is grounds for disciplinary action

up to and including removal or termination, as well as criminal prosecution. Report

instances of suspected misuse to your Director or to the systems administrator.
PAGE69

of our computer equi

work hardware, telec

tions, software and p

have been analyzed a

In addition, our older 

equipment also has b

to be Y2K compliant

approximately $1 billion. During this period,

the OIG conducted the following two reviews

in this area.

MANAGEMENT CONTROLS OVER

WIRELESS COMMUNICATIONS

REQUIRE IMPROVEMENT

The OIG completed a review of controls

over wireless communication equipment and

services within the Postal Service. The OIG

concluded that opportunities existed to

enhance management controls over wireless

communication equipment and services. Control weaknesses were noted in multiple contracts and provider procurements, administration and oversight responsibilities, non-official

business use reimbursements, various purchasing and issuing methods, and accounting for

wireless communication expenses. The OIG

suggested that Postal-wide policies and procedures be developed and disseminated, and that

all wireless communication equipment and services be coordinated through Postal Service

telecommunications specialists. Management

agreed and has planned or taken actions to

address these concerns. (OIG DS-MA-99-005)

TELECOMMUNICATION 

COMPANY AGREES TO OVER 

$2 MILLION SETTLEMENT

A large telecommunications contractor,

responsible for installing telecommunications

wiring for 8,000 Postal facilities, agreed to credit the Postal Service for improperly billed work.

The investigation revealed that the contractor

had subcontractors completing most of the

work and was billed for services not rendered,

incomplete, or defective. After being notified

of this, the contractor recouped over $2 million

Several of these strategies in electronic commerce are beginning to emerge. For instance,

the Postal Service is building a strong Internet

presence and working on becoming the “carrier

of choice” for merchandise purchased on the

Internet. However, the Postal Service faces a

formidable challenge in implementing electronic commerce strategies as it moves into the

next century. 

Clearly, electronic commerce will forever

change the way the Postal Service conducts

business. As the OIG’s Y2K audit work comes

to a close, electronic commerce is quickly

becoming one of the OIG’s highest priorities.

During this period, the OIG conducted the following review in this area. 

MISUSE OF POSTAL SERVICE

LOGOS

While attending the 22nd Universal Postal

Congress in Beijing, China, OIG officials found

that marketing material in the form of a mail

piece from a vendor improperly used the Postal

Service and PC Postage logos. The material,

when taken in context with the vendor’s advertising, improperly implied endorsement by the

Postal Service. Moreover, the vendor did not

meet requirements for designation as an

approved licensed vendor of PC Postage. The

matter was referred by OIG to Postal Service

marketing officials, who notified the vendor to

immediately cease further use of the logos and

mail piece design. Postal Service officials further requested a response from the vendor on

how it intends to correct the false impression of

Postal Service endorsement. 

(OIG IG-PA-99-001)

OIG Information Technolog

system tests as the Y2K a
addresses anticipated legal action that could

arise as a result of economic losses due to Y2K

failures.

The Postal Service also relies extensively

on external suppliers that are critical to moving

the mail, such as airlines, railroads, and trucking

companies who are also susceptible to the Y2K

problem. This legislation limits damages and

the amount the Postal Service could recover as

a result of a Y2K supplier problem. The OIG

will continue to monitor the Y2K area and

post-Y2K work will consider liability issues.

PROPOSED LEGISLATION

H.R. 439 - The Paperwork Elimination

Act of 1999

This legislation would amend the Paperwork Reduction Act by directing the federal

government to provide those doing business

with the government the option of using electronic communication instead of sending paperwork through conventional mail delivery. The

bill encourages the use of electronic signatures

to facilitate the transmission of documents. The

Department of Justice has raised concerns,

which the OIG shares, regarding the validity of

and reliance upon documents and signatures

that exist only in an electronic, digital format.

Without appropriate safeguards, the potential

for fraud exists. Also, if small businesses, educational and nonprofit institutions, federal contractors, state and local governments, and others take widespread advantage of electronic filings with the federal government, as encouraged

by this bill, revenues of the Postal Service could

be affected. Although the Paperwork Reduction Act does not apply to the Postal Service,

the OIG will monitor the use of electronic signatures and documents as part of its ongoing

work.

◆ maintain customer trust.

The Inspection Service is m

challenges and opportunities of 

merce era by working with other 

departments, training criminal 

developing new loss prevention 

assisting Postal Service customers 

who are vital to the growth 

commerce.

PAGE70 TECHNOLOGY REVIEWS
OFFICE OF INSPECTOR GENERAL

Violence in the Workplace 

Workplace Climate

Health Care

Postal Employees Safety Enhancement Act

Legislative and Regulatory Reviews

INSPECTION SERVICE

Workplace Climate

Postal Robberies 

Drugs in the Workplace

PAGE 71
PAGE72 LABOR MANAGEMENT REVIEWS

OFFICE OF INSPECTOR

GENERAL

The OIG has identified the improvement

of the Postal Service’s labor management area as

one of the major performance and management

challenges that must be addressed if the Postal

Service is to remain competitive in the 21st

century. The OIG supports the Postal Service

in its overall goal or fostering an inclusive and

welcoming workplace consistent with Postal

Service values of fairness, opportunity, safety,

and security. The Labor Management Area

consists of violence in the workplace, workplace

climate, health care, and the Postal Employees

Safety Enhancement Act. In this area, the OIG

conducted 36 reviews during this period. 

VIOLENCE IN THE WORKPLACE

The Postal Service widely acknowledges

concerns about violence in the workplace.

Both the OIG and the Postal Service are dedicated to the prevention of violence and considers early intervention and cooperation with

management and employee groups essential.

The OIG recently conducted nine reviews of

violence in the workplace. 

EFFECTIVE VIOLENCE 

PREVENTION AND RESPONSE

PROGRAMS NOT IMPLEMENTED

IN A POSTAL DISTRICT 

An audit of the violence prevention program in the Suncoast District identified that

management did not follow many of the violence prevention policies and procedures outlined in the May 1997 Threat Assessment Team

Guide and the Crisis Management Plan for

MANAGEMENT APPROP

HANDLED VIOLENT SITU

In another review, the OIG c

gations were valid that a Weste

manager jeopardized the safety of p

ees and the public. Specifically, th

ager solicited postal employees to p

tol for another employee and 

loaded pistol to an official age

While making a speech, the p

ejected the loaded clip, pointe

toward a wall, and fired it, igniti

had been chambered in the pisto

found District management prope

ed the incident and the plant ma

ciplined. (OIG LM-LA-99-003) 

ZERO TOLERANCE POLIC

ENFORCED

The OIG reviewed seve

involving the Postal Services enfo

“Zero Tolerance Policy” for vio

workplace. For example:

◆ The OIG reviewed an allega

Southeast Area Post Office s

physically assaulted an empl

OIG also reviewed managem

pliance with Postal Service p

procedures for investigating 

the allegation. The OIG co

management appropriately f

Postal Service’s published ze

policy regarding violence an

ate behavior in the workplac

(OIG LM-MA-99-010)

◆ The OIG reviewed an allega

harassment and intimidation 

ees by another employee wa

a Midwest Post Office. The 
PAGE73

reported to them?

The OIG will investi

management retaliatio

complaints received f

Postal Service employ

had previously report

wrongdoing to this of

investigating and resolving an allegation

of threats made by a postmaster to assault

a Southwest Area Post Office employee.

The OIG found no evidence that the

postmaster threatened the employee.

The OIG review also concluded that

management followed the Postal Service’s published zero tolerance policy

regarding violence and inappropriate

behavior in the workplace. 

(OIG LM-LA-99-001)

WORKPLACE CLIMATE

The Postal Service believes that signs of

workplace stress are present, and that they need

to take comprehensive steps to address issues of

improving the workplace environment. This

must be accompanied by the emphasis of aligning human resources with business requirements. The OIG agrees with this assessment

and has conducted 22 reviews regarding workplace climate, some of which are highlighted

below. 

UNWARRANTED DISCIPLINE AND

HOSTILE WORK ENVIRONMENT

FOUND

The OIG completed two reviews in the

Southeast Area:

◆ The first review addressed allegations of

unwarranted disciplinary actions in a

district. The review disclosed that in

some cases disciplinary action taken

against postmasters was warranted, but in

other cases, it was not. The OIG also

found that the Postal Service disciplinary

action appeals process was not followed

and that the policy did not stipulate a

timeframe for answering appellants. The

OIG recommended that management

also agreed to provide specific timeframes

for appeal processes and to hold managers accountable for not handling

appeals in a timely manner. 

(OIG LR-AR-99-012) 

◆ While performing an audit at a district,

the OIG found that a potentially hostile

environment existed at a processing and

distribution center. Upon further

investigation, the OIG determined that

a plant manager treated employees in an

abusive manner. Furthermore, despite

the fact that the district manager was

aware of the plant manager’s behavior,

the labor climate at the center continues

to be hostile and intimidating.

Although management did not agree

with the OIG conclusion that the labor

climate at the plant continues to be

hostile and intimidating, they did agree

with the OIG suggestions and plan to

implement them. 

(OIG LR-MA-99-009)

OTHER LABOR MANAGEMENT

REVIEWS

The OIG generally does not review

individual employee complaints. However,

over the past six months, we have performed

24 individual reviews of workplace violence

and climate issues that resulted from congressional requests. As a new agency, we undertook

these reviews to develop a greater understanding of the Postal culture and to establish

a working relationship with Postal Management to ensure that employees’ concerns are

addressed. The chart shows the diversity of

the labor relations complaints we received

(see chart on the next page).
PAGE74 LABOR MANAGEMENT REVIEWS

HEALTH CARE

For FY 1999, the Postal Service paid over

$580 million for employee injury claims, an $18

million increase over FY 1998. Because the

Postal Service is self-insured for workers’ compensation costs, they make such payments out

of operating funds. Thus, the Postal Service’s

net income is affected every time an employee is

injured and unable to return to work. Containing these costs continues to be key to the Postal

Service’s financial well being. During this period, OIG completed five reviews in this area, one

which is highlighted below.

WEAK CONTROLS OVER INJURY

CLAIMS NOTED

The OIG conducted an audit of a district’s

process for submitting, controverting, and

challenging injury claims. The audit revealed

opportunities for improving timeliness, controversions, challenges, and management control

of injury claims. The OIG made recommendations to hold supervisors accountable for submitting injury claims timely, to reemphasize the

importance of applying existing procedures

when processing and reviewing injury claims,

and to develop additional management controls

over injury claims. Management agreed with 8

of 11 recommendations. With one exception,

management’s planned actions were responsive

to the issues raised in this report. 

(OIG HC-AR-99-001) 

THE POSTAL EMPLOYEES 

ENHANCEMENT ACT 

The Postal Employees Saf

ment Act, enacted on Septemb

changed the status of the Postal 

employer under the Occupation

Health Act of 1970. As a result, t

vice can be cited, fined, and refer

cution by the Occupational Safet

Administration for safety violatio

was meant to assure safe and heal

conditions for Postal workers.

We have initiated and pla

audits to determine the impact 

Employees Safety Enhancement 

Postal Service. For example, we 

reviewing the Postal Service’s im

of the Act and its effect on orga

mate and operations in general. 

will include a review of the mecha

the Postal Service to identify subs

ties and for upgrading those faci

health and safety standards.

LEGISLATIVE AND REGU

REVIEW

PROPOSED LEGISLATION

H.R. 2385 - Postal Service E

Violence - General Accounti

Study

This legislation requires 

Accounting Office to study and r

Periodical mailings account for a

significant portion of the Postal

Service’s revenue.

0 25 50 75 100 

HIRING PRACTICES

INTIMIDATION

VERBAL ABUSE

69

88

76
PAGE75

Congress on the subjects that would be examined in the General Accounting Office study.

This study could replicate much of what OIG

does in the labor management area. Evaluating

violence in the workplace is a high priority for

the Postal Service and the OIG.
PAGE76

attention to workplace conditions affecting

employee attitude and behavior throughout the

Allegheny Area was generally effective. The

membership, participation, and operation of

threat assessment teams varied from one performance cluster to another. Recommendations

included establishing a process to coordinate

and monitor threat assessment teams’ activities

to ensure consistency throughout the area.

Management agreed with audit recommendations. (IS 044-1281484-PA(2))

POSTAL ROBBERIES

The Inspection Service regards the prevention of robberies as one of its highest organizational priorities and affords task force attention

to facility, carrier, and other Postal robberies to

deter these attacks on employees. The Inspection Service investigated 62 robberies in this

reporting period. Robbery-related arrests and

convictions for this semiannual period totaled

69 and 79, respectively.

Examples of these investigations follow.

◆ An individual responsible for the September 1998 robbery of the Old Mystic,

Connecticut, Post Office was sentenced

to over 19 years in a Connecticut State

Prison. At least 15 years of the sentence

must be served. The individual already

had an extensive criminal history

involving armed robberies, burglaries,

and assaults prior to this arrest.

◆ An individual was sentenced to 40 years

in a Louisiana prison without parole for

the November 1997 robbery of the Ferriday, Louisiana, Post Office. An accomplice had been previously sentenced to

25 years incarceration, also without

parole. Another accomplice was sentenced to 15 years of hard labor and must

serve at least ten years. 

prison and ordered to pay ov

in restitution. An accomplic

erated in the investigation w

to two years and five months 

and ordered to pay nearly $1

restitution. Five others invo

robberies were previously sen

DRUGS IN THE WORKPL

To help ensure a safe work

ment, the Inspection Service inv

cotics-related offenses, particularl

narcotics on Postal premises. Dur

annual period, Postal Inspectors 

employees for narcotics violations

The following are drug rel

committed by postal employees.

◆ A postal supervisor in Michi

arrested after Postal Inspecto

ed an Express Mail parcel. T

contained more than five po

marijuana. Postal Inspectors 

the supervisor’s vehicle and h

search produced a drug scale 

unregistered firearm. 

◆ A mail handler in Missouri w

for establishing a marijuana 

operation. Inspectors discov

operation within the mail ha

home which included grow l

300 marijuana plants, and 40 

harvested marijuana in bags. 

◆ A highway contract driver in 

was arrested for using mariju

transporting mail.

◆ A casual custodian in Illinoi

ed for selling crack and mari

◆ A letter carrier in Ohio was 

possession of heroin, marijua

paraphernalia.

LABOR MANAGEMENT REVIEWS
OFFICE OF INSPECTOR GENERAL

Oversight

Legislative and Regulatory Reviews

PAGE 77
PAGE78

For over 200 years, Postal

Inspectors have protected the

mail and U.S. citizens to ensure

that the public’s confidence in the

mail is not undermined.

OVERSIGHT REVIEWS OF INSPECTION SERVICE

GENERAL

One of the primary reasons the OIG was

established in the Postal Service was to provide

oversight of Postal Inspection Service activities.

The OIG’s work in other significant areas provides an independent voice with objective

information and analysis of Postal Service operations and issues.

OVERSIGHT

The OIG seeks to review and resolve all

individual complaints received against the

Inspection Service. During this six month period, we completed 10 oversight reviews of the

Inspection Service. Two recent oversight

reviews are highlighted below.

INSPECTORS PERFORMING

AUDITS WERE NOT SPENDING

AT LEAST 50 PERCENT OF THEIR

TIME PERFORMING LAW

ENFORCEMENT DUTIES

The OIG conducted an audit to determine

if Postal Inspectors performing audits were properly classified as law enforcement officers. The

OIG concluded that at least 91 percent of the

234 inspectors in the audit universe who were

classified as criminal investigators performed

audits as their primary duties. The OIG recommended that the Chief Postal Inspector establish controls to ensure Postal Inspectors devote

50 percent or more of their work hours to law

enforcement duties, or reclassify the positions to

reflect work performed. In addition, the OIG

recommended that Postal Inspector duties be

reviewed to ensure they meet the regulatory

requirements of a law enforcement officer. 

As a result of the audit, the Chief Postal

Inspector plans to divest the Inspection Service

of “Yellow Book” audit work and agreed to

ference. The OIG concluded tha

ference expenditures and agenda i

unnecessary or extravagant, inclu

in mementos. In addition, seve

topics were not directly related t

tion Service mission. The OIG o

suggestions for future conferen

ensuring workshops are clearly m

assigning contracting responsib

activity to centrally control 

requiring that memento expendit

est, and limiting conference pub

tent. To ensure timely dissemi

information contained in the rep

elected to publish the report wit

ment’s comments. A revised r

issued when management co

received. (OIG OV-MA-99-003)

REVIEW OF COMPLAINT

REGARDING THE INSPEC

SERVICE 

The OIG completed sever

complaints concerning the Inspe

Four examples are discussed below

◆ The OIG reviewed an allega

Postal Inspectors failed to pr

tigate a customer’s allegation

tampering. The OIG spoke 

customer on several occasion

the allegations to determine 

action was necessary. The In

Service’s documentation on 

reviewed and the Postal Insp

assigned to the case were int

The OIG inquiry found that 

tion Service appropriately cl

due to lack of evidence.

(OIG OV-CR-00-001) 

Former Chief Inspector Hunter presides

over the 1998 Leadership Conference,

which OIG reviewed. 
PAGE79

in Title 18 of the Un

Code, Section 1341, 

criminal violation to 

United States mail or 

of any private or com

carrier to carry out a 

scheme.

complaint against Postal Service man

agement. As a result, no further contact

was made with the Postal Service

employee and the case was closed. 

(OIG OV-CR-99-004)

◆ The OIG reviewed an allegation from a

Postal Service contractor regarding his

removal from Postal Service employment

and misconduct by Postal Inspectors.

The OIG preliminary inquiry warranted

further investigation by the Inspection

Service Internal Affairs Division. The

investigation confirmed the Postal

Service employee’s allegations that Postal

Inspectors acted unprofessionally, used

profanity, and unnecessarily displayed a

service weapon. The two Postal

Inspectors were counseled on their

unprofessional conduct. 

(OIG OV-CR-99-011)

◆ The OIG reviewed a complaint from a

customer who alleged Postal Inspectors

had not satisfactorily investigated allegations of delayed and undelivered mail by

Postal Service employees, and mail theft.

The OIG found that Postal employees

made various efforts, including increased

attention, to ensure timely and accurate

delivery of mail to the customer’s address

and had attempted numerous times to

contact the customer and reach a mutually satisfactory solution. Based on the

review, the OIG found no evidence that

would substantiate the allegations. 

(OIG OV-CR-99-005)

stood participation rules, and advisories on the

recipients’ chances of winnings. Both bills provide additional subpoena authority for the

Postal Service. This legislation would give the

Postal Service enhanced law enforcement

authority. The Inspector General submitted a

statement to the Subcommittee supporting the

legislation. The legislation’s enhanced law

enforcement authority is of interest to the OIG

because the OIG has oversight responsibility for

the Inspection Service. 
PAGE80 OVERSIGHT REVIEWS OF INSPECTION SERVICE
OFFICE OF INSPECTOR GENERAL

Integrity Reviews

Executive Investigations

Government Performance and Results Act

Legislative and Regulatory Reviews

INSPECTION SERVICE

Physical Security 

Narcotics Offenses and Trafficking

Fraud Against Consumers 

Fraud Against Businesses 

Fraud Against the Government

Child Exploitation

Prohibited Mail

Postal Burglaries

PAGE 81
PAGE82 OTHER SIGNIFICANT REVIEWS

OFFICE OF INSPECTOR

GENERAL

In addition to reviews that are summarized

earlier in this Semiannual Report, the OIG has

conducted 20 reviews of significant issues related to Postal Service operations. The significant

issues highlighted below center around integrity. 

INTEGRITY REVIEWS

Integrity in the operation of top Postal

management is essential to ensuring that the

Postal Service serves its customers and employees in an ethical manner.

OPPORTUNITIES TO IMPROVE

PROCEDURES FOR DISCLOSING

POTENTIAL CONFLICTS OF 

INTEREST

During an inquiry, the OIG noted opportunities to enhance the administration of the

Postal Service ethics program. Specifically, the

OIG found the procedures for disclosing potential conflicts of interest could be improved. The

OIG suggested that senior Postal officials be

provided advance notice of: the names of companies and contractors potentially impacted by

their decisions prior to their participation in

decisional meetings, and that senior officials

disclose intermediary business relationships to

the General Counsel, who serves as the designated agency ethics official. During the inquiry,

the Postal Service law department instituted

enhancements in the ethics program that fully

addressed the first issue and partially addressed

the second issue. Although not required, the

OIG suggested that the Law Department offer

high-level Postal Service employ

flict of interest while negotiating w

ny for future employment and at 

providing advice to the Postal 

changing policy that would favor 

tor. The employee pled guilty in 

was sentenced to two years 

probation, and fined $2,000. 

EXECUTIVE INVESTIGATI

The OIG is responsible for r

gations against senior-level Postal 

utives and has over 30 ongoing i

These investigations result from 

involving criminal violations. Th

the focal point for investigations 

tive violations, including those r

allegations of retaliation action ag

nate personnel by Postal officials. 

GOVERNMENT PERFORM

AND RESULTS ACT

Both the Postal Service and 

directly impacted by the enactmen

ernment Performance and Result

The Act mandates that all fed

establish a set of measurable perfo

and define their strategies to a

goals. Beginning in 1999, annua

plans must be prepared and a re

submitted annually beginning Ma

The Postal Service believes th

tomerPerfect! system complements 

the Act and supports the law’s m

OIG is in the process of design

coverage of Postal Service’s imple

and compliance with the Act. In 

will continue to monitor and rev
PAGE83

tor General Act. If this bill became law, Presidentially-appointed Inspectors General would

be appointed to a term of nine years.

Appointees could serve more than one term.

Another provision provides for a General

Accounting Office review of designated federal

entities, such as the Postal Service, every three

years. In addition, the semiannual reporting

requirement to Congress would be changed to

an annual reporting requirement.

The Postal Service Inspector General is

not Presidentially appointed and would not be

affected by the term provision. However, some

other provisions of the bill do apply to the

Postal Service Inspector General, such as General Accounting Office review and annual

reporting. This legislation would not have a

significant impact on the current operation of

the Postal Service OIG.

H.R. 305 - Office of Inspector General

Oversight Act of 1999

This bill would establish a seven-member

council to oversee the operations of Inspectors

General throughout the federal government.

Congress would appoint four members, and the

remaining three would be selected jointly by

Inspectors General of federal agencies. The

council would receive and investigate complaints about decisions and actions of offices of

Inspectors General and issue recommendations

regarding such complaints. 

House Bill 305 would have an impact on

the Postal Service OIG. It would establish

additional oversight of the OIG, beyond the

current peer review process and potential

reviews by the General Accounting Office, the

President’s Council on Integrity and Efficiency

Integrity Committee, and Congress. The coun

those designated federal entities whose Inspectors General are currently appointed by the

head of the agency. This legislative provision

would affect the Postal Service whose Inspector

General is currently selected by the Postal Service Governors.

PROPOSED RULES

CHANGES IN ORGANIZATION NAMES

AND TITLES—EFFECT UPON RELEASE

OF INFORMATION AND RECORDS

MANAGEMENT

This rule revises the organizational names

and titles contained in Postal Service regulations relating to policies for the release of information and records management. These names

and titles changed as a result of agency restructuring. The revisions reflect to whom the public should address issues relating to the release of

information and records management. This

rule also updates composition of the Postal Service’s Data Integrity Board, of which the

Inspector General is a member. (Federal Register, Volume 64, Number 146, Pages 41289-

41291, July 30, 1999.)
PAGE84

Service employees; however, the

OIG is not part of Postal Service

management chain and does not

report to the Postmaster General,

as do the other Postal Service

employees. To the extent 

practical, the OIG follows 

Postal Service procedures.

June. Audit results revealed that deficiencies

existed in the following areas: security program,

security awareness training, identification

badges, contingency planning, crisis management planning, and registry operations. Management agreed with all recommendations and

began implementation of corrective actions. 

(IS 044-1272744-PA(2)) 

NARCOTICS TRAFFICKING 

The Inspection Service interdicts drug

mailings to protect Postal employees and customers from the violence associated with this

crime and to prevent the abuse of the mail for

such illicit purposes. Inspectors made 802

arrests and obtained 747 convictions in this area

during this reporting period. 

◆ Inspectors in Pennsylvania arrested two

individuals and two other individuals

were indicted for their involvement in a

conspiracy to distribute heroin, prescription drugs, and marijuana into the Pennsylvania State Correctional Institute. An

Express Mail package, with four heroin

balloons, was delivered to an inmate.

The recipient died after ingesting the

contents of one of the balloons. One

defendant pled guilty and the others were

convicted on conspiracy and distribution

charges. The individual who pled guilty

disclosed a scheme in which heroin was

being smuggled into prisons under selfadhesive stamps. As a result of this

investigation, all state correctional institutions in Pennsylvania now remove

stamps prior to delivery to the inmates.

FRAUD AGAINST CONSUMERS

To preserve the public’s confidence and

trust in the U.S. Mail, the Inspection Service

p

investigation, 10 individuals 

ed in a $60 million scheme t

ed over 34,000 inventors. Th

viduals ran three invention 

companies that used mass m

lure victims with false and m

representations to pay advan

high as $11,000.

◆ An Inspection Service inves

well-known financial adviso

was indicted on 134 counts 

securities fraud, false stateme

laundering, and criminal for

individual, who managed in

funds for a number of school 

was charged with defrauding 

districts of $71 million. 

◆ As a result of an Inspection 

investigation, three individu

arrested for mail and wire fra

mitting more than $14 milli

invoices to over 13,000 busi

institutions. 

◆ An Inspection Service mail 

gation resulted in an individ

sentenced to 37 months imp

followed by two years superv

and restitution of $3.5 millio

additional individuals assiste

scheme to defraud $8.4 milli

least 6,500 investors. 

◆ As a result of an Inspection 

investigation, an individual 

tenced to 30 years imprisonm

ordered to pay restitution of 

$8.6 million for organizing a

advertising operation.

OTHER SIGNIFICANT REVIEWS
PAGE85

Postal Inspectors also work to protect the

Government from being victimized by mail

fraud. Two notable investigations involving

fraud against the government follow.

◆ An Inspection Service investigation

resulted in a State representative being

convicted on mail fraud and conspiracy

charges. The representative submitted

$51 million in fraudulent transactions

and mailings. 

◆ As a result of an Inspection Service

investigation in California, two individuals who defrauded the Department of

Veterans’ Affairs of educational assistance benefits of more than $3.8 million

were found guilty of mail fraud, conspiracy, and false claims.

CHILD EXPLOITATION 

Postal Inspectors employ proactive investigative techniques to identify and bring to justice individuals who use the mail to distribute or

knowingly receive child pornography. During

this reporting period, Postal Inspectors made 96

arrests and obtained 72 convictions in this area.

One investigation in this area included:

◆ Inspection Service participation on a

task force of local and federal law

enforcement agencies in Indiana resulted

in the sentencing an individual who was

sentenced to 27 years in prison and fined

$5,000 for offenses relating to ordering

child pornography videos through the

mail.

PROHIBITED MAIL

In the interest of protecting customers and

Postal employees, Postal Inspectors place a high

priority on the investigation of explosive

ed victim’s boyfriend.

◆ As a result of an Inspection Service

investigation, an individual was sentenced to seven years in prison for sending a former spouse an explosive device

inside a hollowed-out Bible.

POSTAL BURGLARIES

The Inspection Service employs sophisticated burglary prevention techniques and

detection devices to make Postal facilities less

vulnerable to attack. Burglaries may result in

property losses or mail thefts and indirect losses

for damage repairs from forced entries. During

this reporting period, the Inspection Service

made 75 burglary arrests, and obtained 62 convictions, including the following:

◆ In August and November of 1994, two

post offices in Pennsylvania were burglarized. After a five year investigation, an

individual was extradited from a Texas jail

to Pennsylvania and arrested for both burglaries. Prior to initiation of the trial the

individual pled guilty to burglary and corruption charges and was sentenced to two

and one-half to five years in prison.
PAGE86 OTHER SIGNIFICANT REVIEWS
DID YOU 

KNOW?

PAGE 87

What is the OIG’s website address?

OIG’s website is www.uspsoig.gov.
Representative, Excessive bulk mail deliveries Azusa, 

California California

Chairman, Misdirection and delay of Washington, DC 

Postal Subcommittee government mailings

Chairman, Untimely delivery of Postal-wide 

Postal Subcommittee newspapers sent via

Periodical Class mail

Representative, Lost contents of package San Francisco, 

California California

Representative, Mail not delivered to house mailbox Hilo, 

Hawaii Hawaii

FINANCIAL MANAGEMENT

Requestor Allegations/Concern Location 

Representative, Viability of the Postal Service Postal-wide 

Pennsylvania Corporate Treasury to manage in

current financial market

Representative, Examine Postal Service policies and St. Louis, 

Pennsylvania procedures regarding revenue Missouri; 

assessment for periodicals Southern Illinois

Representative, Examine Postal Service policies and St. Louis, 

Missouri procedures regarding revenue Missouri;

assessment for periodicals Southern Illinois

Representative, Examine Postal Service policies and St. Louis, 

Missouri procedures regarding revenue Missouri; 

assessment for periodicals Southern Illinois

Representative, Examine Postal Service policies and St. Louis, 

Illinois procedures regarding revenue Missouri; 

assessment for periodicals Southern Illinois

Senator, Evaluate the Postal Service’s relationship Postal-wide 

Iowa with a Mexican-based bank to identify 

potential business risks

Chairman, Mechanical work performed at Wilmington, 

Postal Subcommittee vehicle maintenance facility Delaware

PAGE 88 APPENDICES
PAGE 89

Representative, Allegations of supervisor New Brunswick, 7/17/99

New Jersey assault and harassment New Jersey

Representative, Mistreatment by Postal Service management Oakland, 7/19/99

California relative to a Workers’ Compensation claim California

Senator, Discriminatory treatment by Human Greensboro, 7/19/99

North Carolina Resources personnel and management North Carolina

Representative, Arbitration for Postal Service disciplinary Babylon, 7/19/99

New York action was prolonged and unfair New York

Senator, Reimbursement of lost wages, Racine, 7/19/99

Wisconsin working conditions Wisconsin

Representative, Discrimination against a Oakland, 7/19/99

California transitional employee California

Chairman, Abusive labor practices, harassment and Postal-wide 7/29/99

Postal Subcommittee discrimination with the Postal Service

Representative, Request for OIG documents used Herndon, 7/29/99

Virginia in preparing reply Virginia

Representative, Review of terms of “constructive resignation” Stockton, 9/3/99

California from part-time position with the California

Postal Service

Representative, Hostility, mismanagement, and Milpitas, 9/3/99

California harassment of employees California

Representative, Unresponsiveness and misconduct by San Francisco, 9/3/99

California Postal Service management California

Representative, Intimidation and retaliation by a supervisor Boston, 9/24/99

Massachusetts Massachusetts

Representative, Denial of a position with the Postal Service Stockton, 9/30/99

California because of age and racial discrimination and California

retaliation for union involvement

Representative, Hostile work environment and unfair Essex, 9/30/99

Vermont hiring process for “casual” employees Vermont
New York New York

Representative, Harassment and retaliation by supervisor Huntsville, 

Alabama Alabama

Representative, Mishandling of disability claim Tolono, 

Illinois Illinois

OVERSIGHT OF INSPECTION SERVICE

Requestor Allegations/Concern Location 

Senator, Constituent was concerned about Belcamp, 

Maryland a possible wiretap Maryland

Chairman, Mail theft, delayed and undeliverable mail, Washington, DC 

Postal Subcommittee and concerns of mail service by

Postal Service employees

Chairman, Misconduct by Postal Service management Herndon, 

Postal Subcommittee and incomplete investigation by Postal Virginia

Inspection Service

Senator, Mail fraud and collusion by Postal Service Postal-wide 

New Jersey employees and inadequate investigation

by Inspection Service

Representative, Postal Inspectors failed to properly investigate Greenbelt, 

Maryland allegations of mail tampering Maryland

Senator, Postal Inspection Service employees acted Great Falls, 

Montana unprofessionally in the course of Montana

an investigation

Chairman, Postal Inspection Service inappropriately Postal-wide 

Postal Subcommittee providing law enforcement pay and benefits 

to Inspectors performing audit work

Representative, Unresponsiveness of Postal Inspection Service Mankato, 

Minnesota and mail delivery problem Minnesota

PAGE 90 APPENDICES
PAGE 91

Florida Florida
Inspection Service

The Inspection Service audit groups are aligned by the type of audits performed whi

rily performance, financial, contract, and facility audits. The Inspection Service con

provide Postal-wide attention in selected areas until these functions are fully transit

OIG.

SUMMARY

The following is a summary by principal areas of reports issued to Postal managemen

April 1, 1999 and September 30, 1999. Congressional inquires completed by OIG a

Appendix A.

Number of Questioned Unsupported 

Principal Area Reports Issued Costs Costs 

Accepting and Processing 6 $0 $0 

Computer Security 200

Contracting and Facilities 1500

Delivery Operations 300

Developmental 300

Electronic Commerce 100

Financial Data Processing Systems 400

Financial Related 700

Health Care 400

Information Systems 100

Integrity 1600

Marketing 8 0 0 

Oversight 200

Transportation 5 0 0 

Violence in the Workplace 500

Workplace Climate 200

Y2K 5 0 0 

Contract Audit 36 16,275,943 10,383 

District Accounting Office Audit 1700

Expenditure Investigation 200

Facility Program Audits 500

Financial Installation Audit 11100

Financial Investigation 2100

Financial Opinion Audit 7800

Performance Audit 44 0 0 

Revenue Investigation 98 0 0 

GRAND TOTAL 501 $16,275,943 $10,383 $1,

PAGE 92 APPENDICES
PAGE 93

Equipment Preventive 

Maintenance Program

DA-AR-99-001 Priority Mail Processing Postal-wide 0 0 0 9/24/99

Center Network

AC-LA-99-001 Review of Periodicals 0 0 0 9/27/99

AC-MA-99-002 Review of Periodicals in Atlanta, GA 0 0 0 9/27/99

the Atlanta District

AC-AR-99-001 Plant Verified Drop Postal-wide 0 0 0 9/28/99

Shipment System

DS-AR-99-003 Government Mails Section Washington, DC 0 0 0 9/29/99

of the Brentwood Processing 

and Distribution Center,

Washington, DC

TRANSPORTATION

97RI002CA001 Fuel Test Implementation 0 0 0 4/19/99

and Environmental 

Compliance

TR-AR-99-001 Compliance Opportunities Postal-wide 0 0 $55,000,000 9/23/99

for Savings in Rail

Detention Costs

TR-AR-99-003 Emergency and Extra Trip Postal-wide 0 0 $137,000,000 9/29/99

Expenditures on 

Highway Routes

CA-AR-99-001 Opportunities to Increase Postal-wide 0 0 $12,700,000 9/30/99

Savings Through the Use

of Natural Gas Vehicles

CA-AR-99-002 Removal of Underground Postal-wide 0 0 0 9/30/99

Storage Tanks

SERVICE DELIVERY

99-RI-052-RQ000 False Claims Allegation 0 0 0 8/18/99

DS-MA-99-006 Complaint Resolution 0 0 0 9/10/99

Process, Mankato Post Office

DS-AR-99-002 USPS Welcome Kit Program Postal-wide 0 0 0 9/20/99

MARKETING

RG-LA-99-001 Review of the Printing Error 0 0 0 5/20/99

in Grand Canyon Stamp

RG-MA-99-005 Review of the Operations Postal-wide 0 0 0 7/27/99

of the Citizens' Stamp

Advisory Committee

DA-AR-99-003 Corporate Call Management Postal-wide 0 0 $962,000,000 9/29/99

RQ-MA-99-001 Maintenance of Self-Serve Postal-wide 0 0 0 9/30/99

Postal Centers
FINANCIAL MANAGEMENT

Un- Recom

Case/Report Subject Title/ Location/ Questioned supported Funds 

Number Project Type Contract Costs Costs Bette

FINANCIAL-RELATED

FR-AR-99-006 Review of Dinero Postal-wide 0 0 

Seguro Program

99-RP-009-RQ000 Deceased Annuitant 0 0 

Benefits Payments

98-RI-017-RP000 Embezzlement Allegation 0 0 

98-RI0-18-RP000 Embezzlement Allegation 0 0 

FR-AR-99-007 Bank Secrecy Act Postal-wide 0 0 

System Update

RG-MA-99-007 Review of International Postal-wide 0 0 

Travel Process

FR-MA-99-003 Mementos and Other Items Postal-wide 0 0 

Provided at Conferences,

Meeting and Training Sessions

FINANCIAL DATA-PROCESSING SYSTEMS

FR-FA-99-001 Money Order Edit Codes Postal-wide 0 0 

FR-AR-99-010 Fiscal Year 1999 Information St. Louis, MO 0 0 

System Controls, 

St. Louis Information

Service Center

FR-AR-99-008 Fiscal Year 1999 San Mateo, CA 0 0 

Information System Controls,

San Mateo Information

Service Center

FR-AR-99-009 Fiscal Year 1999 Minneapolis, MN 0 0 

Information System Controls,

Minneapolis Information

Service Center

CONTRACTING AND FACILITIES

98-RI-013-CA000 Conflict of Interest Allegation 0 0 

98-RI-036-RP000 Bribery Allegation 0 0 

CA-MA-99-001 Contracting Concerns Wilmington, DE 0 0 

Identified at the Wilmington,

Delaware Vehicle 

Maintenance Facility

LA-FA-99-002 Procurement Training for Postal-wide 0 0 

Contract Employees Assigned

to Facilities Project

Manager Positions

99-RI-012-RQ000 Improper Property Disposal 0 0 

PAGE 94 APPENDICES
g//

99-RP-002-RP000 Quality Assurance 0 0 0 9/30/99

TOTAL $0 $0 $0

TECHNOLOGY

Un- Recommend

Case/Report Subject Title/ Location/ Questioned supported Funds Put to Issue

Number Project Type Contract Costs Costs Better Use Date

Y2K

FR-MA-99-002 Y2K Initiative: Review Postal-wide $0 $0 $0 7/7/99

of Administration

99-RP-024-RQ000 False Statements Allegation, 0 0 0 8/13/99

Y2K

99-RP-019-RQ000 Product Substitution Allegation, 0 0 0 8/27/99

Y2K

IS-AR-99-002 Y2K Initiative: Status on Postal-wide 0 0 0 9/20/99

Postal Service Y2K Readiness

TR-AR-99-002 Y2K Business Continuity Postal-wide 0 0 0 9/29/99

and Contingency Planning:

Initiation and 

Business Impacts

DEVELOPMENTAL

DA-MA-99-002 Tray Management System Postal-wide 0 0 0 6/28/99

Software Management

DA-AR-99-002 Point of Service ONE Postal-wide 0 0 0 9/20/99

DA-LA-99-004 Point of Service ONE Postal-wide 0 0 0 9/30/99

COMPUTER SECURITY

CI-MA-99-001 Warning Banners and Postal-wide 0 0 0 6/11/99

Monitoring on USPS

Computer System

CI-LA-99-001 Computer Security Postal-wide 0 0 0 7/30/99

INFORMATION SYSTEMS

DS-MA-99-005 Review of Wireless Postal-wide 0 0 0 6/29/99

Communications Equipment

and Services

ELECTRONIC COMMERCE

IG-PA-99-001 Misuse of Postal Service Logo Postal-wide 0 0 0 

TOTAL $0 $0 $0

PAGE 95
LM-LA-99-002 Allegation of a Hostile Midwest Area 0 0 

Working Environment at a

Midwest Area Post Office

LM-LA-99-003 Allegation Plant Manager Western Area 0 0 

in the Western Area

Jeopardized the Safety of

USPS Employees and

the Public

LM-MA-99-010 Allegation of a Physical Southeast Area 0 0 

Assault on an Employee

in a Southeast Area

Carrier Unit

WORKPLACE CLIMATE

LR-MA-99-009 Allegations of Harassment Atlanta, GA $0 $0 

and Intimidation of

Employees at the 

Atlanta North Metro

Processing and

Distribution Center

LR-AR-99-012 Allegation of Unwarranted Southeast Area 0 0 

Disciplinary Actions Against

Postmasters in a District

in the Southeast Area

HEALTH CARE

98-R1-037-CA000 False Claims Allegation 0 0 

99-RI-014-HC000 False Claims Allegation 0 0 

99-RI-080-HC000 False Claims Allegation 0 0 

HC-AR-99-001 Northern Virginia District's Northern Virginia 0 0 

Process for Submitting, 

Controverting, and

Challenging Injury Claims

TOTAL $0 $0 

OVERSIGHT REVIEWS OF INSPECTION SERVICE

Un- Recom

Case/Report Subject Title/ Location/ Questioned supported Funds 

Number Project Type Contract Costs Costs Bette

OV-AR-99-001 Classification of Inspection Postal-wide $0 $0 

Service Personnel 

Performing Audits

OV-MA-99-003 Fiscal Year 1998 Postal-wide 0 0 

Leadership Conference

TOTAL $0 $0 

PAGE 96 APPENDICES
PAGE 97

99-CX-018-EX000 Executive Investigation 0 0 0 8/16/99

99-RI-002-RP000 Gratuities Allegation 0 0 0 8/18/99

99-RI-060-RQ000 Credit Card Fraud Allegation 0 0 0 8/18/99

99-RI-059-RQ000 Impersonation Allegation 0 0 0 9/7/99

99-CX-013-EX000 Executive Investigation 0 0 0 9/8/99

99-CX-028-EX0PI Executive Investigation 0 0 0 9/8/99

EX-LA-99-001 USPS Ethics Program - 0 0 0 9/30/99

Conflicts of Interest

TOTAL $0 $0 $0

OIG GRAND TOTAL $0

$0

$1,167,300,000 
181-1280201-AC(1) Rudolph/Libbe, Inc. 0 0 

181-1281155-AC(1) Aramark Services, Inc. 0 0 2,43

181-1282982-AC(1) Laurits R. Christensen 0 0 

Associates, Inc.

181-1283348-AC(1) Alan Ritchey, Inc. 0 0 

181-1283911-AC(1) Siemens ElectroCom, L.P. 0 0 4

181-1286335-AC(1) Burns & McDonnell 0 0 3

Engineering Company, Inc.

181-1288330-AC(1) Learning Systems 0 0 

International

181-1288561-AC(1) VISTA Network 0 0 9

Integration Services, Inc.

181-1289630-AC(1) Siemens ElectroCom, L.P. 0 0 4,40

181-1292836-AC(1) Kling Lindquist Partnership 0 0 

181-1293536-AC(1) Siemens ElectroCom, L.P. 0 0 13,25

181-1294162-AC(1) Siemens ElectroCom, L.P. 0 0 12

181-1296773-AC(1) Rapistan Systems 0 0 3

182-1227773-AC(1) The Austin Company 0 0 

183-1278298-AC(1) D&M Maryland General 310,763 0 

Contracting, Inc.

183-1286194-AC(1) The Haskell Company 203,511 10,383 

184-1218532-AC(1) New Breed Leasing 0 0 

Corporation

184-1259633-AC(1) ACME Consulting 29,758 0 

Corporation

185-1272701-AC(1) ITC Real Estate Group/ 4,811 0 

McKinley III, Inc.

185-1276374-AC(1) Sunbelt Properties 0 0 

185-1278370-AC(1) Boardwalk Development 57 0 

185-1290622-AC(1) PM Realty Group 11,247 0 

185-1294974-AC(1) Burnham Pacific 3,445 0 

Properties, Inc.

186-1259748-AC(1) Siemens ElectroCom, L.P. 0 0 

190-1220527-AC(2) PhotoAssist, Inc. 0 0 

190-1290163-AC(2) Siemens ElectroCom, L.P. 15,662,099 0 

192-1262874-AC(2) Independent Postal 50,252 0 

Financial Consultants

192-1262877-AC(2) Ernst & Young, LLP 0 0 

192-1262879-AC(2) Foster Associates, Inc. 0 0 

192-1262885-AC(2) Tad Resources 0 0 

PAGE 98 APPENDICES
PAGE 99

009-1256125-AD(1) Cost and Revenue Analysis Columbus, OH 43216 0 0 0 5/28/99

009-1256127-AD(1) Cost and Revenue Analysis Akron, OH 44309 0 0 0 8/26/99

009-1257636-AD(1) Cost and Revenue Analysis Seattle, WA 98109 0 0 0 8/16/99

009-1257637-AD(1) Cost and Revenue Analysis Sacramento, CA 95799 0 0 0 8/23/99

009-1257638-AD(1) Cost and Revenue Analysis San Francisco, CA 94188 0 0 0 5/6/99

009-1261327-AD(1) Cost and Revenue Analysis Richmond, VA 23232 0 0 0 8/30/99

009-1261332-AD(1) Cost and Revenue Analysis Baltimore, MD 21233 0 0 0 8/30/99

009-1261334-AD(1) Cost and Revenue Analysis Merrifield, VA 22081 0 0 0 5/13/99

009-1264539-AD(1) Cost and Revenue Analysis Providence, RI 02904 0 0 0 4/9/99

009-1264540-AD(1) Cost and Revenue Analysis Boston, MA 02205 0 0 0 8/9/99

009-1264542-AD(1) Cost and Revenue Analysis Chicago, IL 60669 0 0 0 9/2/99

009-1264544-AD(1) Cost and Revenue Analysis Chicago, IL 60669 0 0 0 4/27/99

009-1264585-AD(1) Cost and Revenue Analysis Farmingdale, NY 11735 0 0 0 8/2/99

009-1264586-AD(1) Cost and Revenue Analysis Hicksville, NY 11802 0 0 0 9/7/99

009-1264587-AD(1) Cost and Revenue Analysis Rochester, NY 14692 0 0 0 4/16/99

009-1265208-AD(1) Cost and Revenue Analysis Knoxville, TN 37950 0 0 0 5/20/99

009-1265279-AD(1) Cost and Revenue Analysis Indianapolis, IN 46206 0 0 0 6/3/99

009-1265358-AD(1) Cost and Revenue Analysis Atlanta, GA 30304 0 0 0 3/08/99*

009-1265363-AD(1) Cost and Revenue Analysis Dallas, TX 75260 0 0 0 4/7/99

009-1265367-AD(1) Cost and Revenue Analysis Tulsa, OK 74101 0 0 0 7/21/99

009-1265373-AD(1) Cost and Revenue Analysis Kansas City, MO 64108 0 0 0 8/30/99

009-1265493-AD(1) Cost and Revenue Analysis Dayton, OH 45401 0 0 0 5/27/99

009-1265808-AD(1) Cost and Revenue Analysis St. Paul, MN 55101 0 0 0 8/23/99

009-1265817-AD(1) Cost and Revenue Analysis Minneapolis, MN 55401 0 0 0 8/23/99

009-1265822-AD(1) Cost and Revenue Analysis St. Cloud, MN 56301 0 0 0 8/23/99

009-1265825-AD(1) Cost and Revenue Analysis Eagan, MN 55121 0 0 0 8/23/99

009-1265904-AD(1) Cost and Revenue Analysis New Orleans, LA 70113 0 0 0 5/6/99

009-1265905-AD(1) Cost and Revenue Analysis Austin, TX 78710 0 0 0 8/27/99

009-1266391-AD(1) Cost and Revenue Analysis Jacksonville, FL 32203 0 0 0 4/2/99

009-1267245-AD(1) Cost and Revenue Analysis Jacksonville, FL 32203 0 0 0 4/2/99

009-1268616-AD(1) Cost and Revenue Analysis Philadelphia, PA 19104 0 0 0 9/3/99

009-1268617-AD(1) Cost and Revenue Analysis Bellmawr, NJ 08099 0 0 0 7/26/99

009-1268618-AD(1) Cost and Revenue Analysis Harrisburg, PA 17105 0 0 0 7/21/99

009-1269794-AD(1) Cost and Revenue Analysis Spokane, WA 99210 0 0 0 5/26/99

009-1269800-AD(1) Cost and Revenue Analysis Billings, MT 59101 0 0 0 5/11/99

009-1272247-AD(1) Cost and Revenue Analysis Salt Lake City, UT 84199 0 0 0 03/29/99*

009-1275468-AD(1) Cost and Revenue Analysis Portland, OR 97208 0 0 0 7/29/99
009-1291257-AD(1) Cost and Revenue Analysis Wichita, KS 67276 0 0 

009-1292349-AD(1) Cost and Revenue Analysis Pittsburgh, PA 15290 0 0 

009-1292382-AD(1) Cost and Revenue Analysis Cleveland, OH 44101 0 0 

009-1293004-AD(1) Cost and Revenue Analysis Florence, SC 29501 0 0 

009-1293006-AD(1) Cost and Revenue Analysis Charlotte, NC 28228 0 0 

009-1293255-AD(1) Cost and Revenue Analysis Federal Way, WA 98003 0 0 

009-1293350-AD(1) Cost and Revenue Analysis San Juan, PR 00936 0 0 

009-1294524-AD(1) Cost and Revenue Analysis Louisville, KY 40231 0 0 

009-1295775-AD(1) Cost and Revenue Analysis Springfield, MA 01101 0 0 

010-1270980-AD(1) Air Transportation Anchorage, AK 99502 0 0 

Procedures

010-1293686-AD(1) Vehicle Management Ft. Worth, TX 76161 0 0 

Accounting System

010-1294008-AD(1) Vehicle Management Denver, CO 80202 0 0 

Accounting System

010-1294009-AD(1) Vehicle Management Denver, CO 80202 0 0 

Accounting System

010-1294033-AD(1) Vehicle Management South Suburban, IL 60499 0 0 

Accounting System

010-1294070-AD(1) Vehicle Management Boston, MA 02210 0 0 

Accounting System

010-1294072-AD(1) Vehicle Management Providence, RI 02940 0 0 

Accounting System

010-1294164-AD(1) Vehicle Management Houston, TX 77007 0 0 

Accounting System

010-1294270-AD(1) Vehicle Management Sacramento, CA 95813 0 0 

Accounting System

010-1294325-AD(1) Vehicle Management Duluth, GA 30026 0 0 

Accounting System

010-1294328-AD(1) Vehicle Management Memphis, TN 38101 0 0 

Accounting System

010-1294487-AD(1) Vehicle Management Sterling, VA 20166 0 0 

Accounting System

010-1294656-AD(1) Vehicle Management Baltimore, MD 21201 0 0 

Accounting System

010-1294726-AD(1) Vehicle Management Pensacola, FL 32501 0 0 

Accounting System

010-1294923-AD(1) Vehicle Management Royal Oak, MI 48068 0 0 

Accounting System

010-1295180-AD(1) Vehicle Management Pittsburgh, PA 15233 0 0 

Accounting System

PAGE 100 APPENDICES
PAGE 101

011-1255814-AF(1) Financial Installation Audit Reading, PA 19612 0 0 0 6/30/99

011-1255815-AF(1) Financial Installation Audit Newark, NJ 07102 0 0 0 8/5/99

011-1255819-AF(1) Financial Installation Audit Syracuse, NY 13220 0 0 0 7/29/99

011-1256147-AF(1) Financial Installation Audit San Francisco, CA 94188 0 0 0 6/30/99

011-1256263-AF(1) Financial Installation Audit Chicago, IL 60607 0 0 0 8/13/99

011-1256266-AF(1) Financial Installation Audit Minneapolis, MN 55401 0 0 0 7/30/99

011-1256274-AF(1) Financial Installation Audit Seattle, WA 98109 0 0 0 8/6/99

011-1256380-AF(1) Financial Installation Audit Saratoga Springs, NY 12866 0 0 0 5/28/99

011-1256401-AF(1) Financial Installation Audit Richmond, VA 23232 0 0 0 7/22/99

011-1256403-AF(1) Financial Installation Audit Jacksonville, FL 32203 0 0 0 4/2/99

011-1257137-AF(1) Financial Installation Audit Boulder, CO 80302 0 0 0 6/17/99

011-1257138-AF(1) Financial Installation Audit Little Rock, AR 72202 0 0 0 9/7/99

011-1257160-AF(1) Financial Installation Audit Merrifield, VA 22081 0 0 0 5/27/99

011-1257164-AF(1) Financial Installation Audit Baltimore, MD 21233 0 0 0 9/2/99

011-1257197-AF(1) Financial Installation Audit St. Louis, MO 63155 0 0 0 4/8/99

011-1257201-AF(1) Financial Installation Audit Salt Lake City, UT 84199 0 0 0 5/24/99

011-1257202-AF(1) Financial Installation Audit Hazelwood,, MO 63042 0 0 0 6/18/99

011-1257203-AF(1) Financial Installation Audit Kansas City, MO 64108 0 0 0 8/26/99

011-1257697-AF(1) Financial Installation Audit Dallas, TX 75260 0 0 0 7/3/99

011-1257730-AF(1) Financial Installation Audit Tulsa, OK 74101 0 0 0 8/16/99

011-1287844-AF(1) Financial Installation Audit Pewaukee, WI 53072 0 0 0 5/12/99

012-1255822-AF(1) Financial Installation Audit Cranford, NJ 07016 0 0 0 4/9/99

012-1256130-AF(1) Financial Installation Audit Sandy, UT 84070 0 0 0 8/24/99

012-1256271-AF(1) Financial Installation Audit Santa Clara, CA 95050 0 0 0 9/9/99

012-1256278-AF(1) Financial Installation Audit Palo Alto, CA 94303 0 0 0 9/10/99

012-1256281-AF(1) Financial Installation Audit Eau Claire, WI 54701 0 0 0 6/3/99

012-1256285-AF(1) Financial Installation Audit Minot, ND 58701 0 0 0 8/31/99

012-1256381-AF(1) Financial Installation Audit Dover, NH 03820 0 0 0 4/6/99

012-1256385-AF(1) Financial Installation Audit Niagara Falls, NY 14302 0 0 0 8/19/99

012-1256408-AF(1) Financial Installation Audit West Palm Beach, FL 33406 0 0 0 6/9/99

012-1256583-AF(1) Financial Installation Audit Watkinsville, GA 30677 0 0 0 5/11/99

012-1256722-AF(1) Financial Installation Audit San Luis Obispo, CA 93401 0 0 0 8/12/99

012-1256724-AF(1) Financial Installation Audit Costa Mesa, CA 92626 0 0 0 4/13/99

012-1256729-AF(1) Financial Installation Audit Visalia, CA 93277 0 0 0 5/26/99

012-1256732-AF(1) Financial Installation Audit Temecula, CA 92591 0 0 0 4/1/99

012-1256734-AF(1) Financial Installation Audit Burbank, CA 91505 0 0 0 8/30/99

012-1257156-AF(1) Financial Installation Audit Greenville, NC 27834 0 0 0 4/7/99
013-1256142-AF(1) Financial Installation Audit Porterville, CA 93257 0 0 

013-1256276-AF(1) Financial Installation Audit Ketchikan, AK 99901 0 0 

013-1256280-AF(1) Financial Installation Audit Battle Ground, WA 98604 0 0 

013-1256287-AF(1) Financial Installation Audit Marquette, MI 49855 0 0 

013-1256388-AF(1) Financial Installation Audit Edmeston, NY 13335 0 0 

013-1256392-AF(1) Financial Installation Audit Seneca Falls, NY 13148 0 0 

013-1256394-AF(1) Financial Installation Audit Atkinson, NH 03811 0 0 

013-1256396-AF(1) Financial Installation Audit Lyndonville, VT 05851 0 0 

013-1256412-AF(1) Financial Installation Audit Okeechobee, FL 34972 0 0 

013-1256415-AF(1) Financial Installation Audit Eustis, FL 32726 0 0 

013-1256421-AF(1) Financial Installation Audit Bushnell, FL 33513 0 0 

013-1256576-AF(1) Financial Installation Audit Laurens, SC 29360 0 0 

013-1256731-AF(1) Financial Installation Audit Harbor City, CA 90710 0 0 

013-1257161-AF(1) Financial Installation Audit Huntersville, NC 28078 0 0 

013-1257754-AF(1) Financial Installation Audit Bonham, TX 75418 0 0 

013-1257755-AF(1) Financial Installation Audit Hondo, TX 78861 0 0 

013-1259871-AF(1) Financial Installation Audit Clementon, NJ 08021 0 0 

013-1259872-AF(1) Financial Installation Audit Devon, PA 19333 0 0 

013-1259873-AF(1) Financial Installation Audit Peckville, PA 18452 0 0 

013-1259874-AF(1) Financial Installation Audit Nazareth, PA 18064 0 0 

013-1259875-AF(1) Financial Installation Audit Hummelstown, PA 17036 0 0 

013-1259876-AF(1) Financial Installation Audit Moundsville, WV 26041 0 0 

013-1259877-AF(1) Financial Installation Audit Rochester, PA 15074 0 0 

013-1259878-AF(1) Financial Installation Audit Brownsmills, NJ 08015 0 0 

013-1259879-AF(1) Financial Installation Audit Milton, PA 17847 0 0 

013-1259881-AF(1) Financial Installation Audit Riegelsville, PA 18077 0 0 

013-1261759-AF(1) Financial Installation Audit Crown Point, IN 46307 0 0 

013-1261760-AF(1) Financial Installation Audit Friendswood, TX 77546 0 0 

013-1261761-AF(1) Financial Installation Audit Grand Blanc, MI 48439 0 0 

014-1255751-AF(1) Financial Installation Audit Gardiner, NY 12525 0 0 

014-1255755-AF(1) Financial Installation Audit Grahamsville, NY 12740 0 0 

014-1255761-AF(1) Financial Installation Audit East Durham, NY 12423 0 0 

014-1255831-AF(1) Financial Installation Audit Hope, NJ 07844 0 0 

014-1256146-AF(1) Financial Installation Audit Woodlake, CA 93286 0 0 

014-1256288-AF(1) Financial Installation Audit Girard, IL 62640 0 0 

014-1256397-AF(1) Financial Installation Audit Dennis, MA 02638 0 0 

014-1256398-AF(1) Financial Installation Audit Shirley, MA 01464 0 0 

PAGE 102 APPENDICES
PAGE 103

015-1256404-AF(1) Financial Installation Audit Bethlehem, NY 12161 0 0 0 6/17/99

015-1256407-AF(1) Financial Installation Audit Grafton, NY 12082 0 0 0 7/8/99

015-1256410-AF(1) Financial Installation Audit Hubbardsville, NY 13355 0 0 0 6/17/99

015-1257236-AF(1) Financial Installation Audit Mineral Springs, PA 16855 0 0 0 6/2/99

015-1259884-AF(1) Financial Installation Audit Mainland, PA 19451 0 0 0 8/24/99

015-1259885-AF(1) Financial Installation Audit Spring Mount, PA 19478 0 0 0 7/29/99

015-1260055-AF(1) Financial Installation Audit Butte, NE 68722 0 0 0 7/21/99

015-1260056-AF(1) Financial Installation Audit Chili, WI 54420 0 0 0 7/20/99

015-1261779-AF(1) Financial Installation Audit Branch, MI 49402 0 0 0 4/12/99

015-1261781-AF(1) Financial Installation Audit Hayden, IN 47245 0 0 0 4/5/99

TOTAL $0 $0 $0

Un- Recommend

Case/Report Subject Title/ Location/ Questioned supported Funds Put to Issue

Number Project Type Contract Costs Costs Better Use Date

DISTRICT ACCOUNTING OFFICE AUDITS

016-1254866-AF(2) Financial Installation Audit Washington, DC 20260 0 0 0 1/21/99*

016-1255379-AF(2) Financial Installation Audit Indianapolis, IN 46206 0 0 0 9/10/99

016-1255759-AF(2) Financial Installation Audit Hauppauge, NY 11760 0 0 0 9/1/99

016-1255833-AF(2) Financial Installation Audit San Juan, PR 00936 0 0 0 4/8/99

016-1255849-AF(2) Financial Installation Audit Hauppauge, NY 11760 0 0 0 8/30/99

016-1255853-AF(2) Financial Installation Audit Chicago, IL 60607 0 0 0 4/13/99

016-1256151-AF(2) Financial Installation Audit Billings, MT 59103 0 0 0 4/13/99

016-1256374-AF(2) Financial Installation Audit Jacksonville, FL 32203 0 0 0 4/2/99

016-1256417-AF(2) Financial Installation Audit Portland, ME 04104 0 0 0 8/3/99

016-1256828-AF(2) Financial Installation Audit Portland, ME 04103 0 0 0 7/21/99

016-1257204-AF(2) Financial Installation Audit Salt Lake City, UT 84199 0 0 0 5/10/99

016-1262205-AF(2) Financial Installation Audit Merrifield, VA 22081 0 0 0 5/6/99

016-1268028-AF(2) Financial Installation Audit Merrifield, VA 22081 0 0 0 5/19/99

016-1279227-AF(2) Financial Installation Audit Chicago, IL 60669 0 0 0 7/1/99

016-1288956-AF(2) Financial Installation Audit San Diego, CA 92150 0 0 0 5/7/99

016-1290066-AF(2) Financial Installation Audit Princeton, NJ 08540 0 0 0 8/3/99

178-1295164-AF(2) Financial Installation Audit San Juan, PR 00936 0 0 0 9/17/99

TOTAL $0 $0 $0
017-1274106-FI(2) Financial Investigation Pittsfield, MA 01201 0 0 

017-1278451-FI(2) Financial Investigation Norwalk, CT 06852 0 0 

017-1282722-FI(2) Financial Investigation Unalaska, AK 99684 0 0 

017-1291576-FI(2) Financial Investigation Stevenson, WA 98648 0 0 

017-1291765-FI(2) Financial Investigation Storrs, CT 06268 0 0 

017-1292668-FI(2) Financial Investigation North Bend, OR 97459 0 0 

017-1292669-FI(2) Financial Investigation Port Orford, OR 97465 0 0 

017-1296172-FI(2) Financial Investigation Plessis, NY 13675 0 0 

017-1296509-FI(2) Financial Investigation Wyoming, NY 14591 0 0 

017-1296648-FI(2) Financial Investigation Darby, MT 59829 0 0 

017-1296713-FI(2) Financial Investigation Sandy Springs, GA 30328 0 0 

017-1297309-FI(2) Financial Investigation Stratford, NY 13470 0 0 

017-1297550-FI(2) Financial Investigation Frewsburg, NY 14738 0 0 

827-1251750-FI(1) Financial Investigation Franklin Park, IL 60131 0 0 

827-1285202-FI(1) Financial Investigation Irrigon, OR 97844 0 0 

840-1289523-FI(2) Financial Investigation Detroit, MI 48233 0 0 

447-1255210-ECM(3)Financial Investigation Detroit, MI 48232 0 0 

TOTAL $0 $0 

Un- Recom

Case/Report Subject Title/ Location/ Questioned supported Funds 

Number Project Type Contract Costs Costs Bette

FACILITY PROGRAM AUDITS

092-1248055-FPA(1) Area Approved Facility Memphis, TN 38161 0 0 

Projects

092-1279194-FPA(1) Indefinite Quantity Contracts Washington, DC 20066 0 0 

092-1289784-FPA(1) Lease Administration Washington, DC 20066 0 0 

098-1206355-FPA(1) New Construction Owned Greensboro, NC 27420 0 0 

098-1209237-FPA(1) New Construction Owned Columbus, OH 43216 0 0 

TOTAL $0 $0 

Un- Recom

Case/Report Subject Title/ Location/ Questioned supported Funds 

Number Project Type Contract Costs Costs Bette

REVENUE INVESTIGATIONS

061-1253949-RI(1) Postage Meter Hayward, CA 94544 0 0 

061-1257801-RI(1) Postage Meter Beaverton, OR 97008 0 0 

061-1258638-RI(1) Postage Meter Southfield, MI 48037 0 0 

061-1258804-RI(1) Postage Meter Louisville, KY 40299 0 0 

061-1258805-RI(1) Postage Meter Greensboro, NC 27625 0 0 

061-1262144-RI(1) Postage Meter West Allis, WI 53227 0 0 

PAGE 104 APPENDICES
PAGE 105

061-1293830-RI(1) Postage Meter Smyrna, GA 30082 0 0 0 7/30/99

061-1295320-RI(1) Postage Meter Ft. Collins, CO 80525 0 0 0 9/10/99

061-1295321-RI(1) Postage Meter Phoenix, AZ 85009 0 0 0 8/31/99

061-1297397-RI(1) Postage Meter Killeen, TX 76542 0 0 0 9/28/99

062-1201749-RI(1) Nonprofit Mail Boston, MA 02210 0 0 0 5/27/99

062-1252671-RI(1) Nonprofit Mail Maple Grove, MN 55369 0 0 0 7/14/99

062-1279732-RI(1) Nonprofit Mail Harrison Township, 0 0 0 7/19/99

MI 48045

062-1282411-RI(1) Standard Mail Punta Gorda, FL 33950 0 0 0 3/16/99*

062-1283291-RI(1) Standard Mail Kennesaw, GA 30144 0 0 0 4/28/99

062-1283532-RI(1) Nonprofit Mail Atlanta, GA 30341 0 0 0 4/8/99

062-1284300-RI(1) Nonprofit Mail Delano, MN 55328 0 0 0 4/23/99

062-1290326-RI(1) Nonprofit Mail Sterling Heights, MI 48312 0 0 0 5/18/99

062-1290784-RI(1) Standard Mail St. Clair Shores, MI 48082 0 0 0 6/25/99

062-1291093-RI(1) Standard Mail Athens, GA 30601 0 0 0 6/21/99

062-1291732-RI(1) Nonprofit Mail Royal Oak, MI 48083 0 0 0 8/13/99

062-1294846-RI(1) Nonprofit Mail Southfield, MI 48075 0 0 0 8/26/99

062-1295451-RI(1) Standard Mail Atlanta, GA 30338 0 0 0 8/25/99

062-1295819-RI(1) Nonprofit Mail Farmington Hills, MI 48333 0 0 0 8/30/99

062-1297028-RI(1) Nonprofit Mail Richmond, VA 23233 0 0 0 9/14/99

062-1297451-RI(1) Nonprofit Mail Rochester, MI 48308 0 0 0 9/24/99

063-1129974-RI(2) Nonprofit Mail Appleton, WI 54919 0 0 0 5/27/99

063-1129976-RI(2) Nonprofit Mail Menasha, WI 54952 0 0 0 5/27/99

063-1130002-RI(2) Nonprofit Mail Green Bay, WI 54303 0 0 0 5/27/99

063-1238283-RI(2) Standard Mail St. Cloud, MN 56301 0 0 0 8/24/99

063-1282416-RI(2) Standard Mail Clearwater, FL 33764 0 0 0 3/16/99*

063-1282419-RI(2) Standard Mail Brandon, FL 33511 0 0 0 3/12/99*

063-1282428-RI(2) Standard Mail Versailles, KY 40383 0 0 0 3/15/99*

063-1290785-RI(2) Periodical Mail Waseca, MN 56093 0 0 0 6/11/99

064-1243854-RI(1) First-Class Mail Atlanta, GA 30324 0 0 0 7/06/98*

064-1253100-RI(1) Nonprofit Mail Boston, MA 02205 0 0 0 9/23/99

064-1275422-RI(1) First-Class Mail Richmond, VA 23232 0 0 0 3/01/99*

064-1281509-RI(1) First-Class Mail Boston, MA 02205 0 0 0 4/21/99

064-1283665-RI(1) Business Reply Mail Norfolk, VA 23501 0 0 0 4/9/99

064-1283749-RI(1) First-Class Mail Boston, MA 02210 0 0 0 6/14/99

064-1285571-RI(1) First-Class Mail New Orleans, LA 70160 0 0 0 5/19/99

064-1286154-RI(1) First-Class Mail Fortuna, CA 95540 0 0 0 4/30/99

064-1289899-RI(1) Business Mail Entry Unit San Francisco, CA 94120 0 0 0 5/28/99
066-1284083-RI(1) Business Mail Entry Unit Denver, CO 80266 0 0 

066-1286157-RI(1) Business Mail Entry Unit Fortuna, CA 95540 0 0 

066-1293525-RI(1) Standard Mail St. Louis, MO 63155 0 0 

066-1296792-RI(1) Standard Mail Oakland, CA 94615 0 0 

066-1296926-RI(1) Nonprofit Mail Old Saybrook, CT 06475 0 0 

066-1297856-RI(1) Nonprofit Mail Mattoon, IL 61938 0 0 

067-1223421-RI(1) Manifest Mailings Miami, FL 33052 0 0 

068-1275423-RI(1) Business Mail Entry Unit Boston, MA 02205 0 0 

068-1291045-RI(1) Impact Credit Card Houston, TX 77251 0 0 

068-1291603-RI(1) Postage Meter Wilmington, DE 19808 0 0 

068-1291672-RI(1) Contract Unit Review Vega Alta, PR 00762 0 0 

068-1296668-RI(1) Goods and Services Virginia Beach, VA 23456 0 0 

069-1278476-RI(2) Bulk Mail Permits and Fees Rocky Mount, VA 24151 0 0 

069-1289963-RI(2) Postage Meter Philadelphia, PA 19124 0 0 

069-1296866-RI(2) Nonprofit Mail Lancaster, PA 17601 0 0 

380-1221556-RI(1) Counterfeit Postage Stamps Hazel Green, WI 53811 0 0 

384-1289912-RI(1) Bypass Mailing Edison, NJ 08906 0 0 

384-1294489-RI(1) Business Reply Mail Chicago, IL 60605 0 0 

388-1183443-RI(1) Postage Meter Kansas City, MO 64108 0 0 

920-1293409-RI(1) Plant Loads Franklin Park, IL 60131 0 0 1.02

920-1297017-RI(1) Periodical Mail Des Moines, IA 50321 0 0 

922-1256220-RI(1) Manifest Mailings St. Paul, MN 55101 0 0 

923-1221400-RI(1) Business Mail Entry Unit Holliston, MA 01746 0 0 

923-1274894-RI(1) Business Mail Entry Unit Richmond, VA 23232 0 0 

924-1170790-RI(1) Presort Bureaus Charlotte, NC 28228 0 0 

924-1240141-RI(1) Business Mail Entry Unit Seattle, WA 98111 0 0 

924-1257645-RI(1) Presort Bureaus Canton, OH 44711 0 0 

924-1262702-RI(1) First-Class Mail Denver, CO 80239 0 0 

924-1266353-RI(1) Business Mail Entry Unit Seattle, WA 98134 0 0 

924-1282716-RI(1) Presort Bureaus Lansing, MI 48913 0 0 

924-1284723-RI(1) Presort Bureaus Memphis, TN 38173 0 0 

924-1290085-RI(1) Presort Bureaus Nashville, TN 37210 0 0 

924-1290851-RI(1) First-Class Mail Boston, MA 02205 0 0 

TOTAL $0 $0 $1,023

PAGE 106 APPENDICES
PAGE 107

041-1292192-PA(2) Delivery Point Sequence 0 0 0 9/21/99

042-1274505-PA(2) Information Systems Security 0 0 0 6/29/99

044-1272744-PA(2) Physical Security 0 0 0 6/10/99

044-1281484-PA(2) Workplace Behavior 0 0 0 9/17/99

045-1290390-PA(2) City Route Inspections/ 0 0 0 7/1/99

Adjustments Follow-Up

045-1291771-PA(2) Vehicle Utilization Follow-Up 0 0 240,000 9/3/99

045-1291772-PA(2) Vehicle Utilization Follow-Up 0 0 0 9/25/99

052-1257657-PA(3) Indefinite Quantity Contract 0 0 0 5/26/99

Work Orders

052-1257658-PA(3) Indefinite Quantity Contract 0 0 0 5/26/99

Work Orders

052-1270438-PA(3) Delivery Units 0 0 0 8/27/99

052-1273552-PA(3) Injury Compensation 0 0 0 9/30/99

052-1284213-PA(3) Operational Efficiency 0 0 0 7/7/99

052-1290419-PA(3) Operational Efficiency 0 0 0 6/25/99

052-1294288-PA(3) Endorsement Mail 0 0 0 9/23/99

311-1262202-PA(3) Registered Mail Operations 0 0 0 4/16/99

312-1272877-PA(3) Processing & Distribution 0 0 0 5/25/99

312-1274544-PA(3) Mail Processing-Utilization 0 0 0 5/27/99

of Manpower

312-1275293-PA(3) Registered Mail Operations 0 0 0 8/12/99

312-1294973-PA(3) Operation 030 Productivity 0 0 0 8/10/99

070-1294280-SI(1) Observation of Mail Federal Way, WA 98063 0 0 0 8/17/99

Conditions

071-1251330-SI(2) EXFC Expansion Readiness New Brunswick, NJ 08899 0 0 0 11/24/98*

071-1251331-SI(2) EXFC Expansion Readiness Newark, NJ 07101 0 0 0 11/09/98*

071-1273763-SI(2) Air Route Review Newark, NJ 07114 0 0 0 4/1/99

071-1275896-SI(2) Mail Processing Operations Miramar, FL 33027 0 0 0 6/16/99

071-1278421-SI(2) Mail Service San Diego, CA 92121 0 0 0 5/11/99

071-1280286-SI(2) Observation of Mail San Diego, CA 92121 0 0 0 03/29/99*

Conditions

071-1286044-SI(2) Observation of Mail San Antonio, TX 78245 0 0 0 5/5/99

Conditions

071-1288464-SI(2) Mail Transport Equipment Washington, DC 20260 0 0 0 5/24/99

Review

071-1289438-SI(2) Oversight of Carrier Edison, NJ 08899 0 0 0 5/14/99

Street Time

072-1254408-SI(2) Cleaning Maintenance Chicago, IL 60669 0 0 0 4/19/99

Review
INSPECTION SERVICE GRAND TOTAL $16,275,943

$10,383

$38,183

*Reports with an (*) were issued in a prior semiannual reporting period; however, th

entered into the Inspection Service Database Information System until the current 

period. To ensure all reports issued to management are reported to Congress, they a

included during this reporting period.

PAGE 108 APPENDICES
PAGE 109

Reports requiring a management

decision that were issued during

the reporting period 9 $16,286,326 $10,383

TOTAL 37 $184,353,511 $12,951,756

Reports for which a management

decision was made during the

reporting period (i + ii) 17 $159,906,695 $6,701,135

(i) Dollar value of disallowed costs $159,813,108

(ii) Dollar value of costs not disallowed $93,587

Reports for which no management

decision was made by the end of the

reporting period. Negotiations are ongoing. 20 $24,446,816 $6,250,621

Reports for which no management

decision was made within six months

of issuance (Note 1) 4 $7,122,599 $5,841,563

Reports for which no management

decision was made within one year

of issuance (Note 2) 9 $1,348,710 $398,675

Note 1 - Reports for which no management decision was made within six months of issuance:

Unsupported

Costs

Total Included In

Questioned Questioned

Report Date Case Number Subject Costs Costs

01/21/99 184-1228152-AC(1) Marriott Corporation $28,437 $0

12/07/98 184-1243166-AC(1) Emery Worldwide Airlines $7,087,038 $5,841,563

03/18/99 184-1265466-AC(1) Marriott Corporation $5,576 $0

10/30/98 192-1254969-AC(2) Remitco Management Corporation $1,548 $0

TOTAL $7,122,599 $5,841,563

Note 2 - Reports for which no management decision was made within one year of issuance:

Unsupported

Costs

Total Included In

Questioned Questioned

Report Date Case Number Subject Costs Costs

06/16/98 184-1218249-AC(1) First Data Merchant Services Corporation $515,521 $398,675

09/18/98 184-1244332-AC(1) King-Casey, Inc. $57,213

09/18/98 184-1244333-AC(1) King-Casey, Inc. $70,668

09/18/98 184-1244335-AC(1) King-Casey, Inc. $31,805

03/12/98 182-1224877-AC(1) MidCon Gas Services Corporation $14,920

05/20/96 184-1183079-AC(1) King Casey, Inc. $353,962

02/28/97 184-1203149-AC(1) King Casey, Inc. $14,542

02/28/97 184-1203150-AC(1) King Casey, Inc. $247,133

02/28/97 184-1203153-AC(1) King Casey, Inc. $42,946

TOTAL $1,348,710 $398,675
Reports requiring a management decision

that were issued during the reporting period 20 $

TOTAL 101 $

Reports for which a management decision was

made during the reporting period 52 $

(I) Value of recommendations implemented $

by management

(ii) Value of recommendations that management 

did not recover

(iii) Value of recommendations that management 

did not agree to implement

Reports for which no management decision was

made by the end of the reporting period 49 

Reports for which no management decision was

made within six months of issuance (Note 1) 10 

Reports for which no management decision

was made within one year of issuance (Note 2) 28 

Note 1 - Reports for which no management decision was made within six months of issuance:

Report Case 

Date Number Subject 

12/11/98 181-1251878-AC(1) Key Handling Systems, Inc. 

11/18/98 181-1252266-AC(1) Remitco Management Corporation 

10/13/98 181-1252323-AC(1) Siemens ElectroCom, L.P. 

10/30/98 181-1252372-AC(1) The Freeman Companies 

12/18/98 181-1253441-AC(1) Motion System, L.C. 

11/24/98 181-1254410-AC(1) Dearborn Mid-West Conveyor, Inc. 

11/25/98 181-1254812-AC(1) North American Conveyor, Inc. 

01/08/99 181-1262969-AC(1) Remitco Management Corporation 

03/09/99 181-1265241-AC(1) GFI Genfare 

03/05/99 181-1273828-AC(1) URS Greiner Woodward Clyde 

TOTAL 

Note 2 - Reports for which no management decision was made within one year of issuance:

Report Case 

Date Number Subject 

04/14/98 181-1237199-AC(1) Siemens ElectroCom, L.P. 

04/17/98 181-1238604-AC(1) Siemens ElectroCom, L.P. 

09/25/98 181-1246015-AC(1) MOS International 

08/28/98 181-1246017-AC(1) MOS International 

08/14/98 181-1248027-AC(1) Siemens ElectroCom, L.P. 

PAGE 110 APPENDICES
PAGE 111

09/10/97 1811213327AC(1) Motion Systems, L.C. $491,132

09/10/97 181-1213328-AC(1) Motion Systems, L.C. $545,692

09/10/97 181-1213329-AC(1) Motion Systems, L.C. $561,088

09/08/97 181-1213332-AC(1) Motion Systems, L.C. $569,652

08/14/97 181-1215545-AC(1) Carter Control Systems, Inc. $52,347

09/12/97 181-1218347-AC(1) Siemens Electrocom L.P. $196,086

01/23/98 181-1214298-AC(1) Midwest Conveyor Company, Inc. $135,198

12/03/97 181-1215690-AC(1) K&T Electrical Contractors $481,301

03/06/98 181-1216419-AC(1) Siemens ElectroCom L.P. $66,317

11/26/97 181-1216446-AC(1) North American Conveyor Inc. $517,017

03/06/98 181-1229831-AC(1) Siemens ElectroCom L.P. $3,215,867

03/06/98 181-1231556-AC(1) Siemens ElectroCom L.P. $24,179

TOTAL $59,912,195
Reports Resolved:

Issued Before (10/1/98) 1 35 

Issued Prior Period (3/31/99) 0 46 

Issued This Period (9/30/99) 0 100 

Total Resolved 1 181 

Reports Unresolved as of (9/30/99):

More Than one Year, (Note 2) 0 22 

More Than Six Months, (Note 3) 7 23 

Less than Six Months 3 51 

Total Unresolved 10 96 

Reports Resolved Where Management Did Not Agree 

to Implement All Recommendations 0 7 

Note 1: Excludes audits previously reported, in Appendix C, Findings of Questioned

Costs; and Appendix D, Recommendations That Funds Be Put To Better U

PAGE 112 APPENDICES
PAGE 113

09/30/98 1225935-AD(1) EDP Controls, St. Paul, MN - Management is concluding administrative security

issues.

05/05/98 1169074-AD(1) Inbound International Statistical Systems, Jersey City, NJ - Management is

strengthening controls for international and military mail operations.

08/13/98 1223405-AF(1) Financial Installation Audit, Washington, DC - Management is developing procedures for the BMEU to strengthen internal controls.

06/04/98 1225186-AF(1) Financial Installation Audit, Atlanta, GA - Management is providing attention

to ensure proper administration and collection of fees on mailings.

09/02/98 1222998-AF(1) Financial Installation Audit, South Elgin, IL - Management is acquiring new

equipment for COD operations. Training is being given in BMEU operations.

09/15/98 1220283-PA(1) National Audit on Postal Retail Stores - Management is developing procedures

in retail operations and a handbook and instructions are being updated.

05/12/98 1209811-PA(1) National Audit on Air Transportation Networks - Management is preparing

operating plans and corrective actions are being taken.

06/05/98 1214098-PA(1) National Audit on City Route Inspections and Adjustment Process -

Management is developing instructions to review, train, and increase supervision

for the route inspections/adjustment process and the associated monitoring of

savings.

05/11/98 1204380-PA(1) National Audit on Effectiveness of Employee Reassignments - Management is

developing integrated policies and procedures on reassignment processes and providing attention in complement planning initiatives.

06/04/98 1234520-PA(2) Flats Automation, Denver, CO - Management is developing implementation

plans to address flat sorting machine utilization, flat automation processing, performance targets, staffing and maintenance.

08/20/98 1241721-PA(2) Carrier Transportation, St. Louis, MO - Management is continuing to provide

attention to vehicle maintenance operations.

08/11/98 1233190-PA(2) Injury Compensation and Safety Programs, Kansas City, MO - Management is

progressing in finalizing training material.

09/16/98 1238815-PA(2) Limited and Light Duty Program, Dallas, TX - Management is developing

instructions on claim management.

07/10/98 1244116-PA(3) Service and Efficiency Mail Condition Reporting System, Anchorage, AK -

Management is awaiting final approval of operating plan.

09/11/98 243831-PA(3) Highway Contract Route Driver Screening Process, New Brunswick, NJ -

Management indicated the driver screening process is complete. Functional

responsibility for the driver screening process needs to be identified.

07/01/98 1245454-PA(3) Commercial Mail Receiving Agencies, Van Nuys District - Management indicated that training will be provided.

07/28/98 1245455-PA(3) Commercial Mail Receiving Agencies, San Diego District - Management is

working to improve CMRA controls.
Allegations and to Reassign a Supervisor - USPS and OIG are in 

implementing a resolution process to address the disagreements.

03/31/99 LR-AR-99-009 Health and Safety Issues and Administration of the Advance Sick 

Program at the Garden Grove, California Post Office - USPS and 

process of implementing a resolution process to address the disagre

03/30/99 LR-MA-99-006 Employee Allegations at the Ponca City Post Office - USPS and O

process of implementing a resolution process to address the disagre

INSPECTION SERVICE

Report Report

Date Number Condition

01/29/99 1258946-RI(1) Postage Meter, Miami, FL - Management is in the process of impl

meter inspection schedule.

01/25/99 1262707-RI(1) Postage Meter, Houston, TX - Management is developing a new m

tion schedule and updating the Meter Accounting Tracking Syste

03/29/99 1261754-AF(1) Financial Installation Audit, Royal Oak, MI - Management is pr

tion to internal controls in the BMEU.

03/12/99 1224758-AD(1) FY 1998 Financial Opinion Audit, St. Louis, MO - Management 

attention to internal controls in the International Records Unit a

control procedures for the Pseudo Voucher process.

03/12/99 1225936-AD(1) FY 1998 Financial Opinion Audit, St. Paul, MN - Management 

controls for the National Accounts Receivable System and is in t

developing a report regarding employee separations.

03/12/99 1219706-AD(1) FY 1998 Financial Opinion Audit, San Mateo, CA - Managemen

cessing of implementing recommendations regarding certification 

02/26/99 1256273-AF(1) Financial Installation Audit, Franklin Park, IL - Management is r

dures and providing training for BMEU, employee accountabilitie

due/business reply mail, post office box/caller service, and COD m

12/17/98 1256279-AF(1) Financial Installation Audit, Mattoon, IL - Management is review

relating to unit reserve accountability and employee accountabilit

12/23/98 1256284-AF(1) Financial Installation Audit, Elmhurst, IL - Management is review

relating to employee accountabilities.

01/08/99 1215615-FPA(1) National Priority System, Chicago, IL - Management is in the p

menting recommendations regarding functional responsibility, ran

and evaluation factors.

12/30/98 1223496-PA(1) National Audit on Logistics and Transportation - Management is 

of implementing recommendations regarding air-to-surface mail ro

12/30/98 1262023-RI(1) Postage Meter, Southington, CT - Management is in the process o

ing recommendations regarding meter inventories, meter control, 

meters.

01/27/99 1260310-RI(1) Postage Meter, Anchorage, AK - Management is in the process of 

stock inventory records.

11/03/98 1234435-RI(1) Postage Meter, Denver, CO - Management is developing a new m

schedule.

PAGE 114 APPENDICES
PAGE 115

03/17/99 1255370-AF(1) Financial Installation Audit, Oak Hill, OH - Procedures are being developed to

strengthen internal controls in office accountability.

03/26/99 1223382-AX(1) Mail Transport Equipment Service - Management is implementing recommendations regarding program planning management. 
Rebate fraud 19 19 

Directory solicitations 111

Distributorships 

Employment

False billings 5 4 

Fraud against government agencies

Fraud against USPS

Insurance

Investments

Loans 

Lotteries (Foreign and Domestic) 52 53 

Medical 1 1 

Memberships 

Merchandise:

Failure to furnish 2 2 

Failure to pay 1 1 

Misrepresentation 4 2 

Miscellaneous 452

Solicitations 231

Travel

Work at home 551

TOTAL 102 47 63 

Other Administrative Actions

Administrative Action Requests 82

Temporary Restraining Orders Requested 3

Temporary Restraining Orders Issued 3

Civil Injunctions (1345) Requested 0

Civil Injunctions (1345) Issued 0

Cases Using Direct Purchase Authority 2

Refusals of Direct Purchase Authority 0

Civil Penalties (Section 3012) Imposed $7,000

Expenditures Incurred for:

Test Purchases $588

Expert Testimony $250

Witness Travel $0

Withholding Mail Orders Issued 98

Voluntary Discontinuances 252

PAGE 116 APPENDICES
PAGE 117

Directory solicitations. Fraudulent solicitations in the guise of invoices for advertisement or

renewal in business directories.

Distributorships. Pyramid schemes in which it is mathematically impossible for all participants

to recoup their investments. The emphasis is not on the sale of the product, but on getting

others to participate.

Employment. Soliciting money for information or assistance in obtaining nonexistent or misrepresented jobs.

False billings. Mailing solicitations in the guise of billings.

Fraud against government agencies. Any scheme that attempts to defraud a U.S. government

agency except the U.S. Postal Service. 

Fraud against U.S. Postal Service. Any scheme that attempts to defraud the U.S. Postal

Service.

Insurance. Investigation of insurance-related fraud involving false claims, false advertising on

the availability of insurance, or the collection of premiums for nonexistent policies. 

Investments. Misrepresented opportunities to invest in commodities, gems, metals, stocks,

bonds, certificates of deposit, mutual funds, IRAs, coins, stamps, art, etc.

Loans. Mailings soliciting money for information on nonexistent or misrepresented loans.

Lottery. Advertisements seeking money or property by mail for participation in schemes to win

prizes through chance.

Medical. Sales by mail of misrepresented health products or services, including fraudulent

medical degrees.

Memberships. Failure to provide services advertised in connection with organization

membership.

Merchandise failure to furnish. A mail order operator that does not provide ordered

merchandise.

Merchandise failure to pay. Mail order merchandise that is acquired without providing payment.

Merchandise misrepresentation. Mail order merchandise or services that are materially

misrepresented in advertising.

Miscellaneous. Any other scheme not described in a specific category. 

Solicitations. Fraudulent solicitation of funds through the mail for alleged charitable, religious

minority-oriented groups and similar causes or organizations.

Travel. Fraudulent vacation or travel opportunities.

Work at home. Schemes, such as envelope stuffing, that do not provide home employment.
INSPECTION SERVICE

Type of Investigation ARRESTS 

Revenue & Asset Protection Program

Expenditure Investigations 11 

Financial Investigations 159 

Workers' Compensation Fraud 35 

Revenue Investigations 64 

Robbery 69 

Burglary 75 

Miscellaneous External Crimes

(includes counterfeit and contraband postage, money order 

offenses, vandalism and arson) 316 

Assaults Against Employees

(includes threats and assaults against on-duty postal employees) 214 

Employee Narcotics Cases

(includes employees and non-employees selling narcotics on 

postal property) 14 

Mail Theft by Employees

(includes theft and possession of stolen mail) 229 

Mail Theft by Non-Employees or Contractors

(includes theft and possession of stolen mail) 2,233 

Miscellaneous Employee Crimes

(includes theft of postal property and sabotage of equipment) 49 

Bombs/Explosive Devices 37 

Mailing of Controlled Substances

(includes narcotics, steroids, drug-related proceeds and drug

paraphernalia) 802 

Child Exploitation, Mailing of Obscene Matter and

Sexually Oriented Advertisements 96 

Mailing of Miscellaneous Nonmailables

(includes hazardous material, firearms and weapons, intoxicants,

explosives other than bombs, extortion and false documents) 68 

Mail Fraud 775 

Inspection Service Total2 5,246 

GRAND TOTAL 5,251 

1 Convictions reported in this time frame may be related to arrests made in prior reporting pe

2 Arrests and convictions include joint investigations with other federal law enforcement agen

PAGE 118 APPENDICES
DID YOU 

KNOW?

PAGE 119

Does the OIG investigate individual labor 

management complaints?

The OIG generally does not review individual

employee complaints. However, as a new

agency, we have conducted reviews of some

complaints to develop an understanding of the

Postal culture and employee concerns. 
PAGE120

OFFICE OF INSPECTOR GENERAL

REVENUE

● Bribery, Kickback, and Conflict of 

Interest

● Systemic Reviews

HEALTH CARE FRAUD

● Provider Fraud

● Workers’ Compensation Program 

Oversight

EMBEZZLEMENTS

● Conduct/Partner on cases of $100K or More

EXPENDITURES

● Bribery, Kickback and Conflict of Interest

● Systemic Reviews

● CONDUCT/PARTNER ON CASES INVOLVING EXECUTIVES

✖ TORT CLAIMS: SERIOUS INCIDENTS

● INSPECTION SERVICE INTERNAL AFFAIRS

● Executives

● COMPUTER FORENSICS

● HOTLINE

This exhibit describes the

designation of audit and

investigative functions

agreed to by the OIG and

Inspection Service upon 

passage of the 1996 

amendments to the

Inspector General Act. 

The designation, which 

was approved by the Board

of Governors, identifies 

work already transitioned;

work in transition; and 

new functions now being

performed by the OIG. This

designation is currently

being revised by OIG and

the Inspection Service.

OFFICE OF INSPECTOR GENERAL

FACILITIES

✖ New Facilities Construction 

of $10M or More

✖ New Facilities Right of First 

Choice Between $5 – $1 M

✖ Leases of $1M or More

✖ Repair and Alterations of $1M or More

REVENUE FOCUSED

✖ International Mail

● FINANCIAL STATEMENT - OVERALL OPINION

● POSTAL-WIDE PERFORMANCE

● CONTRACTS, EXCEPT PRE-AWARD AND POST-AWARD

● ALL DEVELOPMENTAL

INSPECTION SERVICE

FACILITIES

-New Facilities Construction 

of $5M or Less

-New Facilities Between $5 – $1 M 

if not chosen by IG

-Leases under $1M

-Repair and Alterations under $1M

FINANCIAL STATEMENT - INSTALLATION AND DISTRICT

AREA DISTRICT AND LOCAL PERFORMANCE 

SERVICE INVESTIGATION

CONTRACTS PRE-AWARD AND POST-AWARD

TRANSITION OF

AUDIT

FUNCTIONS

✇ REVENUE GENERATION

✇ OVERSIGHT OF INSPECTION SERVICE

✇ RATE-MAKING REVIEWS

✇ SELF-INITIATED AND PROACTIVE WORK (CONTRACTING/PERFORMANCE)

✇ LABOR-MANAGEMENT

✇ ELECTRONIC COMMERCE

✇ COMPUTER INTRUSION

ADDITIONAL/

EXPANDED OIG

FUNCTIONS

Designation of Functions (under revision)

OFFICE OF INSPECTOR GENERAL

Key: FY 1999 Status

● Transitioned ✖ In Transition ✇ New Function

INSPECTION SERVICE

REVENUE

-Revenue Loss Detection

WORKERS’ COMPENSATION

-Recipient Cases

EMBEZZLEMENTS

-Under $100 K

EXPENDITURES

-As Referred by IG

-IMPAC Cards

-Local Purchases/Procurements

EMERGENCY RESPONSE ON CASES INVOLVING EXECUTIVES

INTERNAL/EXTERNAL CRIMES

PROTECTION OF EMPLOYEES

SECURITIES FRAUD AND PROHIBITED MAILINGS

TORT CLAIMS

INSPECTION SERVICE INTERNAL AFFAIRS

-Non-executives

FORENSIC AND TECHNICAL SERVICES

Exhibit A

TRANSITION OF

INVESTIGATIVE

FUNCTIONS

THIS PAGE TEARS OUT FOR YOUR CONVENIENCE
PAGE121

INSPECTOR GENERALKarla W. CorcoranSpecial Assistant(Vacant)Executive AssistantCindy Monahan

GENERAL COUNSEL TO THEINSPECTOR GENERAL Thomas CooganCongressional and Public RelationsLaura A. WhitakerLegal ServicesKirt West

INVESTIGATIONSSylvia L. OwensDeputy Ronald K. StithDeputy Richard S. Trinidad

ContractsKim StroudFacilitiesAnthony T. CannarellaHealthcare FraudKatherine K. JohnsonRevenue Generation

(Vacant)Revenue ProtectionDan O'RourkeMike Shiohama

EBDAAHCInDLaJoC

CUSTOMERNorm HancockDeputy Debra Pettitt Computer IntrusionHoward CoxConsulting Services (To be established in FY 2001)Executive InvestigationsTommy HamptonHotlineJoe OlivaOversightBob PembertonQuick Response (T

b

bli

h

d i

FY 2001)

N

SPE

ASS SI AT

OTCEPS NI T N

R G NE

ERAL

SA SI S

NI T NAT

PS

CE

OT

R GENERA

L

ASS SI

AT

NT

NI

SPECTOR GEN

AUDITSRichard ChambersDeputy Robert EmmonsDeputy Colleen McAnteeAccepting/Processing(Vacant)DeliveryBennie CruzDevelopmentalTracy LaPointFinancial AuditJohn M. SeebaSupportGwen JohnsonTransportationDebra Ritt

STRATEGIC PLANNING & QUALITYMANAGEMENTRonald MerrymanDeputy Wayne GoleskiElectronic CommerceRobert BattaForensic & Technical ServiceJohn DeMaggioInformation TechnologyDavid SidranskyInternal QualityJim NugentQuality Assurance/Internal AfGeorge DavisStrategic Planning Russ Barbee
S OUT FOR YOUR CONVENIENCE

OFFICE OF INSPECTOR GENERALThe OIG is organized consistent with the three voices of the Postal Service CustomerPerfect! Program:

Voice of the Customer, Voice of the Employee, and Voice of the Business. The Inspector General,General Counsel, the five Assistant Inspectors General, and the seven Deputy Assistant InspectorsGeneral form the OIG Management Committee.

ASSISTANT INSPECTOR GENERAL FOR STRATEGIC PLANNING & QUALITY MANAGEMENTElectronic Commerce Team - conducts reviews of Postal Service initiatives in the emerging field of electronic commerce, including areas such as information-based indicia and electronic bill payment.Forensic and Technical Services Team - provides technical support in such areas as surveillance, evidence recovery, firearms, computer forensics, and polygraph examinations; and maintains close liaisonwith technical experts in the law enforcement community.Information Technology Team - manages computer operations and telecommunications within the OIG;operates the local and wide-area networks; provides computer security and technical support to OIG staff;and manages agency-wide information systems.Internal Quality Team - instills continuous internal process improvement and facilitates internal communications through orientation, teambuilding, and mentoring.Quality Assurance/Internal Affairs Team - conducts internal reviews of OIG operations and proceduresto ensure that they are effective and appropriate, provides advice on improving operations, and conductsreviews of allegations made against OIG employees. Strategic Planning Team - anticipates and plans for current and future changes in the Postal Service,OIG operations, and technology by identifying workload, providing research and statistical analyses,informing Postal Service employees and customers about the OIG mission, and promoting the vision ofthe OIG.ASSISTANT INSPECTOR GENERAL FOR AUDITS (PERFORMANCE)Accepting and Processing Team - conducts audits and reviews focusing on mail acceptance and collection operations, and mail processing and distribution processes.Delivery Operations Team - conducts audits and reviews to enhance delivery processes and operationsand to improve customer satisfaction.Developmental Team - conducts audits and reviews of new or redesigned Postal Service systems, programs, and operations that are under development.Financial Audit Team - conducts audit work in support of the independent public accounting firm’sannual financial audit opinion and conducts other financial-related audits to identify areas forimprovement.Support Team - provides investigative support to all Performance teams, and conducts audits and reviewsof the Postal Service enabling operations to include quality, government relations, and customer service.Transportation Team - conducts audits and reviews focusing on domestic and international transportation, and logistics operations, specifically addressing Postal Service fleet operations and contracts for airline, highway, and rail services.ASSISTANT INSPECTOR GENERAL FOR INVESTIGATIONS (REVENUE &

including repair, renovation, and new constructionHealth Care Team - identifies and investigates mService for work-related injury claims, and conducCompensation Program.Revenue Generation Team - examines and evaluaadvertising, stamp services, retail, and internationrate cases.Revenue Protection Team - investigates bribery, kenue losses and contract fraud, such as defective p

ASSISTANT INSPECTOR GENERAL Administrative Resources Team - provides the Oand other services necessary to accomplish the OIHuman Resources Team - delivers full-service huemployee relations, ethics, pay and benefits, retirediversity opportunities, and training.Information Systems Team - audits major automadetermine Y2K readiness, and whether applicationdesigned to provide accurate data to managementsupport OIG staff.Labor-Management Teams - conduct audits and etions issues within the Postal Service to assist in fomate for employees and improving operational effand operations involving violence prevention.ASSISTANT INSPECTOR GENERAL Computer Intrusion Team - detects and investigacrimes involving Postal Service computers and telcomputer systems vulnerabilities so that appropriaConsulting Services Team - will assist Postal Servimproving the effectiveness of Postal Service operExecutive Investigations Team - investigates allegPostal Service executives.Hotline Team - operates the OIG Hotline to provbetween the Postal Service and the public.Oversight Team - conducts audits and evaluations Quick Response Team - will evaluate critical, timto requests from Congress and the Governors. (ThGENERAL COUNSEL TO THE INSPECongressional and Public Relations Team - servethe media; coordinates congressional testimony ancoordinates internal policies and procedures; and r

d


y

8 NIAGARA FALLS - recognizes one of the greatest natural wonders of the

world and celebrates the long-lasting friendship between the U.S. and Canada.

13 FREDRICK LAW OLMSTED - recognizes one of the founders of American

landscape architecture and one of America's most prolific park designers.

14 HOLLYWOOD COMPOSERS - honors the outstanding contributions made to

the world of music and entertainment by six distinguished composers: MaxSteiner, Dimitri Tiomkin, Alfred Newman, Bernard Hermann, Franz Waxman,and Erich Wolfgang Korngold.

21 DAFFY DUCK - celebrates the third Looney Tunes animated character to be

honored on a U.S. stamp and joins Bugs Bunny, and Sylvester and Tweety.

26 ALL ABOARD - recognizes the art deco-style passenger trains of the 1930s 

and 1940s.

40 SONORAN DESERT - colorfully depicts the beautiful landscape and teeming

wildlife of the Sonoran Desert in a pane of ten stamps that are part of a largerillustrative scene.

46 AYN RAND - celebrates the achievements of novelist Ayn Rand, who became

the 16th honoree in the American Literary Arts series.

48 PROSTATE CANCER AWARENESS - helps to raise awareness about 

prostate cancer and its often devasting effects on the health of thousands ofAmerican men.

49 AQUARIUM FISH - pays tribute to the spectacular world of the fragile coral

reef and depicts delicate corals, sea anemones, fish, and other species.

57 CALIFORNIA GOLD RUSH —honors the 150th anniversary of the thousands of hopeful “forty-niners” who rushed to California in the hopes of

“striking it rich.”

63 HONORING THOSE WHO SERVED - pays tribute to the nation's military

veterans, police officers and firefighters.

64 AMERICAN GLASSMAKING - showcases four of the finest American glass

designs and glassmaking techniques from the mid-18th century to the early 20thcentury: freeblown, mold-blown, pressed, and art glass.

75 XTREME SPORTS - captures the speed and action of four competitors involved

in BMX biking, inline skating, skateboarding, and snowboarding.

79 JAMES CAGNEY - celebrates the Oscar-winning film and stage great on the

100th anniversary of the year of his birth.

80 TROPICAL FLOWERS - features the breathtaking beauty and color of four

species of tropical flowers: the bird of paradise, royal poinciana, gloriosa lily, andChinese hibiscus.

86 JOHN AND WILLIAM BARTRAM - recognizes the work of John, and his

son William, in establishing the oldest existing botanical garden in the U.S.

ACKNOWLEDGEMENTSThis report represents the outstanding efforts and accomplishments of OIG and InspectionService staff. The production ofthis report would not have beenpossible without the contributions and dedication of the manyOIG and Inspection Service Staffwho contributed to this effort,particularly Wayne Goleski,Karen King-Bickle and RalphDorris of OIG and AndyClemmons of the InspectionService.
OFFICE OF INSPECTOR GENERAL

1735 N. Lynn Street 

Arlington, VA 22209-2020

(703) 248-2300

Fax: (703) 248-2291

Internet: www.uspsoig.gov