The US Postal Service Inspector General issued a management alert on the problem of counterfeit postage on April 8, 2026. In the introduction of the heavily-redacted report, the Office of Inspector General (OIG) stated:
“This management alert presents issues the U.S. Postal Service Office of Inspector General identified during the Counterfeit Postage Program audit. Our objective is to promptly notify the U.S. Postal Service about an identified deficiency in the detection of counterfeit package labels.”
According to the OIG alert, since 2020, the US Postal Inspection Service (an investigative agency within the Postal Service) noted a significant increase in the creation, sale, and use of counterfeit postage. And in February of 2026, the OIG identified a “significant increase” in the volume of packages with suspected counterfeit labels.
The report explained that counterfeit postage is any marking or indicia that has been made, printed, or otherwise created, without authorization from the Postal Service, that is printed, applied, or otherwise affixed on an article placed in the mail that indicates or represents that valid postage has been paid to mail the article.
“Although the Intercept Process has been in place for three years, the Postal Service has not updated the process to keep up with evolving trends in counterfeit labels,” the OIG’s report stated. And “Without the implementation of further controls, the Intercept Process remains vulnerable to evolving counterfeiting methods, as shown by the rise in the use of counterfeit (redacted).”
It noted that the Postal Service had piloted an update to mail processing equipment to detect and mitigate “counterfeit (redacted)” in January 2026.
In its April 3rd response to the OIG alert, Postal Service management disagreed that it had insufficient controls to detect “counterfeit package labels with (redacted),” asserting that it had the ability to detect those labels, but that its ability to intercept the packages was limited. It agreed that prioritizing detection and interception of such counterfeits was crucial to protecting USPS revenue.
The Postal Service noted it has been working on mitigation efforts along with the USPS Inspection Service since August 2025 and has been testing and enhancing a fraud identification program since January. Its target implementation date to meet the OIG’s recommendation is June 30, 2026.
Postal Service management also agreed with the OIG that the amount of unrecoverable revenue since November 2025 was $46.3 million. The full OIG management alert and USPS response is published on the USPS OIG website.
