In response to some of our articles about HSBC late payment processing we received a reply from a reader. The following describes the entire process of mail delivery and sorting. This narrative is long, but also addresses mail fraud. If HSBC claims that your payment is a “late payment” and you know it was not, you can file complaints directly from our main menu. Here is the information in detail:
The first thing I would like to get out of the way is that I have more than thirty years experience with mail operations in both the US Postal System and in the private business sector. I have in my 30 plus years worked with major banks and insurance companies, the post office and service companies involved with processing both incoming and out going mail. I offer this as a little insight into a business that processes and handles incoming mail. I do this to show the difference between a company that follows a good business plan which includes keeping a customer happy; provide efficient movement of incoming funds in a timely manner. (Not a company that uses this excuse to generate additional income at the expense of its customers.)
Most major companies prefer to process incoming payments themselves rather than farm the operation out to service companies. They purchase a wide verity of equipment from high speed sorting equipment to high speed letter openers, scanners and other equipment to increase the speed in order to deposit payments as quickly as possible. This operation is commonly known as a “Lock Box.”
The mail, as it is sorted in the lock box, is either date stamped or time stamped. Some companies require both types of stamping. This process is sprayed on by an inkjet printer. Most companies do this for various reasons but almost all do it. It is a form of record keeping. Almost every customer I worked with wanted the fastest possible method to sort and process incoming mail in order to get the money deposited into accounts in the shortest possible time. That is, if they are reputable banks and insurance companies and do use late fees to pad the bottom line as part of their business plan. They want the incoming money deposited quickly.
The mail is delivered daily from the US Postal System. Some companies have several delivers each day, depending on the volume or at the request of the customer. Once in house the mail is processed on high-speed sorters designed to read and sort mail with speeds up to 50000 pieces per hour. This equipment is the same as us by the post office. The mail, once sorted, is then sent to the respective area of concern or to a processing area that has high speed letter openers.
The mail travels trough these machines to be opened and checks and statements are separated from the envelope. Not all companies process its incoming mail in this manor verbatim, but the larger companies require that in coming mail be processed and money deposited as soon as possible.
Working with the Post Office as a mail producer and mail manger sending out as much as 3 to 4 million pieces of mail per day, I soon learned how long it took for a piece of mail to be delivered anywhere in the US. Our business depended on getting the mail to a specific point on time. Our customers depended on us to have the mail delivered to their clients on time. So with this mind understand the following.
A piece of mail sent first class with the proper address can reach anywhere in the US in a maximum of 4 to 5 business days. A piece mailed on the East Coast can reach any East Coast destination within 24 hours. This is not registered or over night mail, this is normal first class mail. This will vary at certain times of year, such as holidays. The post office is also a business and derives its revenue from delivering the mail, so it would not be in its best interest to delay delivery. But based on the efficiency of postal equipment, the overall handling of the mail in general, I find it hard to believe that HSBC gets its mail delivered differently than any other company in the US. So unless HSBC is processing payments by hand, it does not have a valid reason other than to generate additional revenue by stating that it requires 15 days to process a payment or that you should pay $15.00 for a speed payment.
I can verify, and will do so soon, as to what type of equipment HSBC uses to process mail in its lock box operation. I already know what equipment HSBC uses to mail statements out on, therefore I also know how long it takes to process the out going mail and how many pieces of mail can be produced per hour. And since HSBC does bulk mail HSBC is allowed a discount on postage if they sort the out going mail before delivery to the post office. The DMM or Domestic Mail Manual gives various discounts based on sorting, volume etc. So as an example HSBC could save thousands of dollars per month on mailing, maybe even into the six-figure range.
If in fact a scam can be proven, I am sure that the US Postal Inspectors would be very interested as this could be considered as mail fraud. At which point the US Attorneys would take a very hard look at HSBC and its operations, as would the FBI.
Mail fraud refers to any scheme which attempts to unlawfully obtain money or valuables in which the postal system is used at any point in the commission of a criminal offense. Mail fraud is covered by 18 United States Code, Chapter 63.
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