Commission alert issued to charities to help stamp out stamp fraud

The sending of Christmas cards looms, as does the traditional harvesting of stamps from the envelopes received, to give to any charity fundraising by collecting used stamps.

And, as if to mark the start of the card writing season, the Charity Commission has issued a regulatory alert to charities that might inadvertently be profiting from the collection and sale of used stamps which are then sold again for fraudulent reuse.

The Commission’s concern is that charities, by selling used stamps collected from members of the public in packages known as “kiloware”, may be enabling fraudsters to resell those used stamps for reuse. Kiloware is the term used when packages of postage stamps are sold by weight rather than quantity.

However, because of the generally low value of the kind of stamps included in such packages, the Commission believes that most stamps sold in this way are then prepared and fraudulently re-sold as if they were valid postage, often online and at much lower rate than the standard postal service rate.

A look at the Stanley Gibbons blog suggests that while some collectors may be interested in kiloware that has been “unpicked” or “unsorted” in the hope of a thrilling and unexpected find, charities need to be alert to the risks of this kind of fundraising, and to avoid selling stamps as kiloware, unless they are sure the kiloware is being purchased by a genuine collector.

Warning signs

To help charities avoid becoming involved in stamp fraud, the alert provides the following warning signs for charities engaging in used stamp collections:

• It is unlikely individual stamp collectors would contact a charity directly to buy kiloware in bulk – be suspicious of calls from individuals requesting this.
• Be wary of requests for particular types of stamps in bulk – such as previously used but uncancelled stamps (which have gone through the postal system but remain unmarked in error), Christmas stamps, or “Non Value Indicator” stamps (which do not show a value) – as there is no reason for a genuine collector to make such a request.
• Charities should consider a company or person offering to deal stamps on their behalf as a potential red flag.

Steps charities should take

The alert also confirms that charities should:

• Decline requests from individuals or organisations to purchase stamps directly
• inform Royal Mail if they believe they have been contacted by someone they suspect is not a genuine dealer of stamps in relation to their used stamp collections
• Check the kind of stamps being collected by the charity – foreign stamps are less likely to be sold fraudulently in the UK
• Be aware that a charity’s name may be used in kiloware advertising without permission, and consider checking for this
• Only buy stamps for the charity’s own use from the Post Office or other reputable seller of stamps!

If a charity believes it has inadvertently been involved in stamp fraud, it will need to involve the relevant authorities – Royal Mail and Action Fraud – as well as make a serious incident report to the Commission.