Should manufacturers who make refund and rebate offers discriminate against people who use post-office boxes? I received a letter from Phy Bresse of Lumberton, N.C., in which she recounted the problems she encountered with two promotion offers from Correctol, a product made by Schering-Plough. The first offer asked for the front panel from a box of a competing product, Ex-Lax. The second offer, for a free cup, required a proof-of-purchase from a Correctol package.
Ms. Bresse never received the free product or the cup. She wrote to Schering-Plough to inquire about this, but her letter was not answered. "I wonder if this has happened to others?" Ms. Bresse asked.
I called Schering-Plough, and a spokeswoman told me that both of these offers had a restriction: Requests from post-office boxes would not be honored or even acknowledged. This is why Schering-Plough did not acknowledge my reader's inquiry.
"Rebate fraud is a racket that often uses post office boxes," said the Schering-Plough spokeswoman. She went on to tell me that the "no PO box" policy had been adopted on the advice of Schering-Plough's fulfillment agent, the Young America Corporation. Young America told Schering-Plough that every person has a residential address at which he can receive mail; consequently, the restriction does not prevent any customer from participating in company offers.
Many manufacturers have adopted the "no PO box" restriction based on advice like this. But it's time they considered the facts and adopted a better way to deter fraud.
First, the facts: "The fulfillment agency is not correct," said Sandra Harding, a Postal Service spokesperson. "There are 720,000 post office boxes that are provided to Americans free of charge because they are not entitled to home delivery of their mail."
However, the number of consumers who are affected by the "no PO box" policy is far greater. There are more than 17 million post office boxes. The Postal Service does not keep track of how many of them are used for personal mail, but it could be 10 million or more. These are the consumers who, like Phy Bresse, wait and wait and never receive word that their requests and proofs-of-purchase have been trashed because of a restriction that's written in fine print. This is poor customer relations and a harmful business practice.
It is also no longer necessary. Rick Bowdren is a postal inspector who has been fighting both coupon fraud and refund fraud for more than 20 years. He is a member of the Joint Industry Rebate Task Force.
Mr. Bowdren told me that the task force has compiled a list, called the "central file," of 58,000 people who have been suspected of sending for multiple refund offers by using more than one address or altering their names. In the year that this list has existed, the Postal Service has targeted and sent letters to many of the suspected misredeemers. Mr. Bowdren notes that 87 percent of them have signed voluntary discontinuance letters in which they agree to end their misredemption activities.
Here is an example of how the central file works: The Task Force examined one manufacturer refund offer which received 895,000 requests from consumers. The Task Force determined that 20,107 of these requests were from people who were on the list of misredemption suspects. In this example, the manufacturer could have saved more than $40,000 by using the list to question these suspected misredeemers.
"When a manufacturer sends inquiry letters asking suspected misredeemers to contact the company, the suspects realize their fraudulent practices have been uncovered, and they rarely respond," Mr. Bowdren said.
However, grocery-product manufacturers do not want to play the role of the refund police. Mr. Bowdren believes the best way to use the list of suspects is to make it available to fulfillment agencies, such as the Young America Corporation. With instructions from manufacturers, fulfillment agencies could match refund requests with the list and, when appropriate, withhold payment. "Denying consumers the use of PO boxes is not the answer," Mr. Bowdren said. "Having fulfillment agencies use the central file is a better solution."
A post-office box is a legitimate way to receive mail, and the time has come for both manufacturers and fulfillment agencies to face the fact that the "no PO box" restriction discriminates against a significant number of customers. Fulfillment agencies should take advantage of the Postal Service's central file, and they should advise manufacturers to put an end to the "no PO box" restriction.
Write to Martin Sloane care of United Media, 200 Madison Ave. Fourth Floor, New York, NY 10016.
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