Postal Service ‘welcome kit’ raises questions; White House now cites Privacy Act

The White House has secretly questioned the U.S. Postal Service about whether its change of address “welcome kit” program used by tens of millions of Americans violates the federal Privacy Act.

Despite telling The Washington Times that it had no such records, the White House Office of Management and Budget made inquiries into the Postal Service’s MoversSource program, which is managed under a 10-year, exclusive contract with Pitney Bowes Inc. subsidiary Imagitas, according to internal emails obtained through the Freedom of Information Act.

The federal Privacy Act bars agencies from selling or renting personal information, including names and addresses. Through Imagitas, the Postal Service uses information it collects from people who filled out change-of-address forms to send an official-looking MoversGuide welcome kit filled mostly with advertising and coupons from companies selling cellphones, insurance, home security, mattresses and lots of other move-related products and services.

The Postal Service and Imagitas split the ad revenue. Both say their arrangement is perfectly legal.

In a previous statement to The Times, the Postal Service said it does not sell or rent name and address information and that its program “is well within the Postal Service’s legal authority.”

The OMB inquiry to the Postal Service came just days after privacy specialists in 2011 raised questions about the program in The Times.

“In this case, you have a federal agency collecting information for one purpose, forwarding mail, and using it for a wholly different purpose, direct marketing,” one of the specialists, John Verdi, told The Times in 2011, when he was the senior counsel for the Electronic Privacy Information Center in Washington.

Matthew Broder, vice president of external communications for Pitney Bowes, sent an email to a public information officer for the Postal Service soon after The Times’ story ran.

“I think the bullet was successfully dodged,” he wrote. Reached by phone Monday, he declined to elaborate.

OMB officials had denied having any record of communications with the Postal Service concerning privacy, according to OMB’s response to an open-records request filed by The Times last year.

After initially agreeing to respond to questions about the OMB inquiry Monday, a Postal Service official said the agency would not be able to respond immediately and referred to previous statements on the issue.

The OMB inquiry was included in more than 700 pages of internal emails provided to The Times in recent days. Those documents came after the newspaper filed an appeal with the Postal Service stemming from a previous open-records request seeking information on the Imagitas agreement.

In the email, the OMB analyst wrote that it was “surprising” nobody in the OMB office overseeing privacy compliance across government could recall seeing a System of Record Notices on the agreement.

No one could recall seeing the System of Record Notices “with this agreement laid out and it’s also surprising given that it is a non-federal entity and is for commercial use,” the OMB officials wrote. “Additionally, if there are any other [Postal Service] specific authority that allows you to do this, we want to be made aware of that.”

Taken together, the internal correspondence, though highly redacted in parts, also reveals the extent to which Pitney Bowes and high-level Postal Service officials discussed how to handle the privacy questions.

In another email obtained by The Times, postal officials discussed delaying implementation of a project until the privacy questions from The Times “have ended or at least reduced.”

“This is just in an effort to recognize the sensitivity around the issue,” a postal official wrote in an email to colleagues.

Details about that delayed project are unclear, as much of the information was redacted in the email released by the Postal Service.

The issue also prompted extensive discussions involving the Postal Service’s corporate law office, according to the emails.

Under its arrangement with Imagitas, the Postal Service doesn’t hand over this information directly to advertisers, but instead gives Imagitas exclusive rights to manage the program. Imagitas then sells ads to retailers, though it does not turn over the personal information to ad buyers either.

In a previous statement to The Times, Pitney Bowes called the change-of-address program a “model public-private partnership” that has helped reduce postal operating costs by “millions of dollars a year while connecting countless Americans to valuable discounts from local businesses.”

“We and the Postal Service run this program with integrity and consistent with all our legal obligations,” the company said in the statement.

In a November 2011 interview with editors and reporters at The Times, U.S. Postmaster General Patrick R. Donahoe said the change of address program was vetted by privacy advisers and Postal Service attorneys.

He said the welcome kits with ads and coupons sent to people at their new address were popular with customers, but noted that on privacy issues “we’re looking at double-checking to make sure we’re all set.”

A Postal Service legal memo obtained and reported on by The Times last year proposed legislation to “immunize the current address correction services from any challenge under the Privacy Act or Section 412.”

The Privacy Act prohibits federal agencies from renting or selling personal information unless specifically authorized by law. Section 412 refers to a provision in federal law that bars the Postal Service from making public the names or addresses of postal customers.

“Suggestions have been made that these long-standing services may be inconsistent with current law,” a copy of draft legislation by Postal Service states.

In a statement to The Times on the draft, the Postal Service acknowledged “isolated concerns by a very few individuals who do not agree with the Postal Service’s position.”

The statement also said the draft legislation, which Congress did not enact, offered to “make stronger what the Postal Service already believes is a strong legal position.”

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