Charity Commission warning on postal stamp fraud
30 Nov 2018
The Charity Commission has issued an alert to trustees, employees and volunteers about postal stamp fraud and the risks associated with it
30 Nov 2018
Stamp fraud involves the preparation, distribution and sale of previously used stamps for reuse. Usually these stamps are sold online, at a lower price than the standard postal service rate.
Anyone knowingly collecting, preparing, distributing, reusing or selling used stamps to avoid paying full postal fees may be committing a form of fraud, the regulator warns.
A number of charities collect used stamps as a means of fundraising. The Charity Commission says it does not believe that charities are knowingly profiting from the collection and sale of used stamps, but has concerns that some are inadvertently enabling this form of fraud by selling packages of used stamps, commonly referred to as ‘kiloware’.
The majority of these stamps are then prepared and fraudulently re-sold as if they were valid postage, the Charity Commission says. The money being made by criminal gangs from this type of fraud is significant, and can be used to fund further and wider scale criminal activity.
Fundraisers may believe they are selling stamps to collectors but this is rarely the case as these stamps have little collectable value.
The regulator advises that charities should avoid engaging in this activity unless they are certain that the stamps collected and sold are genuinely being bought by collectors, and are not being used for fraudulent purposes.
Signs that a potential buyer of used stamps may not be a genuine collector include requests to bulk buy. Genuine collectors tend to have their own sources of used stamps and often trade with each other – it is unlikely that they would specifically call on charities to provide loose stamps.
In addition, the Charity Commission says there is no reason for any genuine dealer to request previously used, uncancelled stamps, ‘non value indicator’ stamps which do not display a price, or Christmas stamps in bulk. An uncancelled stamp is one which has been through the postal system, but has not been marked as used, and is sometimes incorrectly described as ‘unfranked’.
Charities are also advised that while some stamp collectors may genuinely request foreign or specialist stamps, they should consider a company or person offering to deal stamps on their behalf as a potential red flag.
The regulator’s advice is that charities should decline requests from individuals or groups who wish to purchase used GB stamps directly - either through direct contact or via an online marketplace.
If a charity is satisfied that the stamps are destined for collectors, they should check the type of stamps. Foreign stamps are less likely to be fraudulently sold in the UK.
Charities should also consider checking that their charity name is not being used in ‘kiloware’ advertising without permission.
Finally, the Charity Commission advises charities buying stamps for their own use to do so from the Post Office or any other reputable seller. Stamps are typically not sold at a discounted price.
Charities which have concerns about postal fraud are advised to alert Royal Mail, Action Fraud and the Charity Commission.
Report by Pat Sweet