Evaluating Mail Recovery Center Package Growth
Background
U.S. Postal Service customers submit complaints about missing packages more than any other issue, with 5 million missing package complaints submitted in fiscal year 2025. When packages go missing, customers turn to the Mail Recovery Center (MRC), which is the Postal Service’s lost and found. It handles “dead mail” — packages that cannot be delivered or returned to the sender – which increased 45 percent during a recent 12-month period, driven in part by shippers refusing these packages.
What We Did
Our objective was to evaluate the processes and policies for dead mail packages sent to the MRC. We reviewed policies and visited 11 facilities generating or processing dead mail, including the MRC. We also sampled and analyzed 2,500 packages.
What We Found
We found the MRC received four times more volume than it reported. MRC management reported that it returned 39 percent of packages to customers, but in reality, it returned less than 1 percent. This was due to flawed estimates that obscured the MRC’s operational shortcomings. As a result, management did not have accurate visibility, hindering its ability to optimize operations and support customers. Shippers also used the MRC as a free disposal service by refusing return-to-sender items (which often come with postage due) or other actions to shift costs to the Postal Service. The Postal Service did not track this data, and 1) lost revenue on return postage and 2) bore the costs of handling discarded packages. As a result, it lost at least $109 million in postage due and $54 million in potential refusal fee revenue from October 2023 through February 2026. The Postal Service could increase revenue by almost $20 million over the next 13 months if it collected postage due from direct shippers and began assessing a refusal fee. Finally, improper upstream handling of dead mail hurt customers’ chances of finding lost items.
Recommendations and Management’s Comments
We made nine recommendations to address the issues in the report. The Postal Service agreed or partially agreed with eight recommendations and disagreed with one recommendation. The U.S. Postal Service Office of Inspector General (OIG) considers management’s comments responsive to recommendations 1, 3, 4, 6, 7, 8, and 9, as corrective action should resolve the issues identified. We view management’s comments to recommendations 2 and 5 as unresolved and will work with management through the audit resolution process.