Postal Reg Violations Cost Mailers Millions

Yikes, that’s gotta hurt.

Two high-volume postal customers were slapped with multi-million dollar penalties and fines in recent decisions by the U.S. Postal Service, reports Dead Tree Edition.

“The U.S. Postal Service assessed Southern California Edison [SCE] $7.6 million in penalties for not keeping its address lists up to date and Sears $1.1 million for allegedly violating the rules governing how folded self-mailers should be sealed, according to the lawsuits,” the article notes.

Both of those decisions are currently being appealed, and other high-volume mailers would be wise to pay attention as these cases play out.

According to the article, “SCE was dinged because of a ‘suspiciously high increase’ in the amount of undeliverable and return-to-sender First Class Mail it sent between 2006 and 2008. The big utility acknowledges two minor errors in its address-correction procedures – regarding missing suite or apartment numbers and the handling of fractional-number street addresses (such as 29 ½ Elm Street) – but contends those did not cause an appreciable increase in bad addresses.”

Rather, the utility attests, the recent economic upheaval and resulting unemployment, foreclosures and mortgage defaults resulted in an increase in customer moves and address issues. They also note in their appeal that, while they overrode the USPS address correction database, they did so “based on customer communications indicating that the USPS data were out of date, the company contends.”

The trouble at Sears results not from address issues but from tabs on so-called “fletters” or self-mailers. The USPS claimed the pieces needed an additional tab, while Sears maintains their design was pre-approved by USPS employees.

It’s amazing to us that an organization like the USPS would make it so difficult for their best customers to do business with them. We’ve had this kind of discussion before. And it’s a good reminder to all of us that the cost of doing business with USPS requires diligence and a thorough understanding of the nuances and vagaries of postal regulations.