U.S. Postal Inspectors Need Comprehensive Crypto Training, Audit Says

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The United States Postal Inspection Service (USPIS), the law enforcement body of the United States Postal Service, conducted an internal audit of how it conducts crypto-related investigations and found that there was significant room for improvement.

Notably, the USPIS handled only a small number of crypto-related cases during the two fiscal years 2019 and 2020 with a total of four closed cases for which postal inspectors seized the crypto as evidence in the past. during an investigation and nine other cases that were managed under the USPIS Cryptocurrency Fund program, established in 2017.

This program aimed to specify standards and policies that can help take into account cryptocurrency transactions during investigations and reduce the associated operational risks. As the report pointed out, this is especially important given that the anonymity of cryptocurrency transactions and large fluctuations in the value of the cryptocurrency create opportunities for abuse or theft when used. during law enforcement activities.

Despite the low volume of crypto-related activity, the USPS Office of the Inspector General (OIG) determined earlier this year that a self-initiated audit was necessary in light of the fact that crypto Currencies can often be the preferred medium of exchange for illicit activities. like ransomware campaigns, online scams and money laundering.

Evaluating operations during the two years under review, the audit report identified a lack of standardized training for USPIS employees regarding cryptocurrencies. This means that postal inspectors who conducted secret investigations and purchased cryptocurrencies as part of their business did not follow guidelines established under the cryptocurrency fund program.

While in some cases, inspectors have used the program to account for the crypto transactions they make for investigative purposes, the audit found that there are many legitimate cases where use of the program may not. be possible, such as when some cryptocurrency sellers only accept payments in the form of specific private cryptocurrencies.

In these cases, inspectors were required to request standard survey funds in the form of US dollars and were personally responsible for all crypto-fiat conversions and the management of unused survey funds.

It was in these scenarios that the audit identified a breakdown in communication between management and inspectors, meaning that program managers currently cannot account for the total amount of cryptocurrency used for the purposes of ‘survey throughout the postal inspection service.

Auditors therefore had to perform a manual keyword search for various crypto-related terms to attempt to determine whether or not cryptography had been used in certain investigative cases, finding 1,064 unique case numbers that will now need to be examined manually. On this point, the audit report concludes:

The program is unable to achieve one of its primary goals of helping postal inspectors deal with the challenges associated with the inherent volatility of cryptocurrencies, which ultimately leaves the Postal Inspection Service vulnerable to the theft, abuse and mismanagement of federal funds.

The audit report recommended that in the future USPIS should ensure that the cryptocurrency fund program has the information it needs to provide oversight and that the agency also develops a program. comprehensive cryptocurrency training course for all inspectors. Additionally, he recommended an overhaul of the current data management for survey transactions, which have been inaccurate and include duplicates, which again impacts the ability of agencies to track and manage accurately. its crypto-related law enforcement activities.

Related: Darknet, Cryptocurrency & Two Crossing Health Crises

According to Margaret McDavid, Deputy Assistant Inspector General in the OIG Audit Office, Inspectorate and Information Technology Branch, USPIS participated in joint efforts to dismantle the Wall Street Dark Web Marketplace in 2019, which led to the seizure of over $ 25 million in crypto.

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