The investigation was initially launched after Project Veritas, a far-right political operation seeking to undermine media outlets and tech companies, produced an affidavit from a “whistleblower” postal worker, Richard Hopkins, in November.
The Inspector General report said Hopkins admitted he never actually heard other employees talking about backdating ballots in the first place.
“[Hopkins] revised his claims, eventually stating that he had not heard a conversation about ballots at all – rather he saw the Postmaster and Supervisor having a discussion and assumed it was about fraudulent ballot backdating,” the report says. “[Hopkins] acknowledged that he had no evidence of any backdated presidential ballots.”
OIG investigators also said they reviewed all the ballots in the post office where Hopkins worked that were postmarked November 3 and later and did not find any evidence of tampering.
“The physical examination of ballots produced no evidence of any backdated presidential election ballots at the Erie, PA Post Office,” the report said.
Investigators also interviewed several other officials in the post office. None of them said they saw any evidence of backdated ballots, the report said.
The OIG report is yet another failure for Project Veritas, run by the conservative activist James O’Keefe. The organization is known for a series of high-profile “sting operations.” Also in 2020, it released a video that baselessly attempted to link Rep. Ilhan Omar to voter fraud. O’Keefe didn’t immediately respond to Insider’s request for comment.
After weeks of mounting pressure from Democrats, President Joe Biden named three nominees to open positions on the US Postal Service’s governing board Wednesday, as a first step toward securing control of the agency that became a point of contention under the Trump administration last year.
Biden nominated two Democrats and a voting rights advocate – Ron Stroman, Anton Hajjar, and Amber McReynolds – to the agency’s board of governors, according to The Washington Post. Stroman previously served as the deputy postmaster general, Hajjar acted as former general counsel for the American Postal Workers Union, and McReynolds is the chief executive of the National Vote at Home Institute.
If all three are confirmed by the Senate, Democrats would essentially gain an advantage over the governing body which would have equal numbers of Democrats and Republicans and one Independent in McReynolds, whose organization is beloved by the left, according to The Post.
The board would then have the potential votes to oust the current postmaster general, Louis DeJoy, who drew criticism last summer over an agency overhaul that led to slower mail service and caused many to worry about the agency’s ability to handle the influx of mail-in ballots for the 2020 general election.
DeJoy has faced repeated calls for his resignation since the summer, with some progressive lawmakers urging Biden to remove the entire board of governors as a way to fill the body with people who would support removing DeJoy, according to Politico.
Biden’s three nominees also mark a significant step toward diversifying the currently all male, mostly white governing body. Of the Biden nominees, Stroman is Black, McReynolds is a woman, and Hajjar provides legal advice to the American-Arab Anti Discrimination Committee, Politico reported.
In stark contrast to its governing body, the US Postal Service is disproportionately Black and female when compared to the rest of the federal workforce, the Pew Research Center showed in a May 2020 report.
At a House Oversight and Reform Committee meeting Wednesday, Rep. Cori Bush of Missouri questioned DeJoy on the board’s lack of diversity, comparing the group to a “millionaire white boys’ club.”
DeJoy pushed back, reminding lawmakers the president is responsible for nominating board members and the Senate is responsible for confirming them, while noting the agency “would love to have a diverse board.”
According to Politico, DeJoy “appeared perturbed” at times during Wednesday’s hearing by certain members’ lines of questioning and discussion of the critical media coverage USPS has faced during his tenure.
He remained defiant, telling lawmakers that he’s not going anywhere and intends to be around “a long time” the outlet reported.
But later that day, the White House signaled it may have other plans for the embattled postmaster.
“He [Biden] believes the leadership can do better, and we are eager to have the board of governors in place,” Press Secretary Jen Psaki said when asked if the president was interested in replacing DeJoy, according to The Hill.
Lawmakers also questioned DeJoy on his next plan for the agency, which, according to The Post, will include higher prices and slower delivery. He reportedly told committee members a strategic plan for the USPS should be ready by March.
DeJoy acknowledged the USPS experienced major delivery delays during the holiday season, citing problems with the agency’s air transportation network as the cause.
The agency has reported billions in losses over the last few years, according to Politico, and the postal board chair Ron Bloom told lawmakers Wednesday that the agency is projected to lose around $160 billion over the next decade if reform measures aren’t taken.
“The years of financial stress, underinvestment, unachievable service standards and lack of operational precision have resulted in a system that does not have adequate resiliency to adjust and adapt to changing circumstances,” DeJoy reportedly testified, arguing the agency’s structural problems preceded his arrival.
Most Republicans defended DeJoy during the hearing and accused their Democratic colleagues of vilifying the postmaster general over how the agency handled mail-in ballots leading up to the 2020 election, which led to “tense exchanges” between members at times during the hearing, The Post reported.
Several of the operational changes made to the USPS last summer under DeJoy were stopped in August, after public outcry over the mounting crisis. The agency’s internal watchdog found in October the changes combined with COVID-19 staffing issues “negatively impacted the quality and timeliness of mail delivery,” according to Politico.
Workhorse extended its two-day slide to 57% on Wednesday after losing a coveted US Postal Service contract to Oshkosh Defense.
The company’s stock fell over 50% amid increased volatility after the news on Tuesday, triggering multiple trading halts before the stock recovered slightly, ending the day 47.5% lower.
The USPS awarded Oshkosh Defense the first part of a 10-year, multi-billion dollar contract to modernize the postal delivery fleet. An initial investment of $482 million will help finalize the design of the new vehicles for mail and package delivery, and allow Oshkosh to assemble 50,000-165,000 vehicles over the contract period.
The USPS made the agreement an indefinite-delivery, indefinite-quantity (IDIQ) contract, meaning that after an initial dollar commitment, the Postal Service will be able to order more vehicles throughout the 10-year contract period.
According to Bloomberg Intelligence analyst Christopher Ciolino, the total contract could be worth more than $5.7 billion in revenue for Oshkosh.
For a time, the electric vehicle maker Workhorse was thought to be a leader in the competition for the lucrative contract. The USPS commissioned five prototype postal service vehicles and Workhorse partnered with truck builder VT Hackney to produce their own.
Analysts at BTIG said they saw Workhorse securing a portion of the USPS contract as a part of their base case scenario and held a “buy” rating on the company, per CNBC.
But now Oshkosh has secured the contract to make both fuel-efficient internal combustion engines and some battery-electric powertrains for USPS, leaving the pre-revenue EV startup Workhorse in a difficult spot.
In October of last year, short-seller Fuzzy Panda Research alleged that Workhorse destroyed its chances of landing the USPS contract.
According to the short-seller, there were numerous failures including suspension issues, motor outages, and even a parking brake malfunction that led to a postal worker injury.
Workhorse stock was down 9.14% as of 8:44 a.m. ET on Wednesday.
The US Postal Services said it will remove mailboxes in several major cities as a security measure ahead of Joe Biden’s Inauguration next week.
As a security measure ahead of the January 20 event, mailboxes in at least 17 states including California and New Jersey, as well as Washington, DC, will be temporarily removed, several press releases from USPS said.
“It’s part of our normal procedures to keep our employees and customers safe during times of protest or when large crowds are gathered near postal facilities, on postal routes, or by mailboxes,” USPS spokesman David Partenheimer told Insider.
At least 14 post offices in DC will also be closed on Inauguration Day, the Postal Service said in a statement.
States and cities are bracing for more civil unrest ahead of Biden’s inauguration. On January 6, supporters of President Donald Trump breached the US Capitol and clashed with law enforcement, halting the joint session of Congress as lawmakers were debating challenges to electoral votes.
Five people died, including a Capitol Police officer and a woman who was shot by law-enforcement officials while participating in the riot.
The USPS has agreed to take several measures to ensure mail-in ballots arrive on time ahead of the Georgia Senate runoff election, The Washington Post reported.
As part of the agreement between the agency and civil rights groups, the US Postal Service will treat ballots as express mail if they are in a processing plant within three days of the January 5 election.
The postal service has been struggling to keep up with massive volumes of mail this year.
The agency said delays are due to the pandemic, with almost a quarter of its employees out sick or in quarantine.
The US Postal Service agreed to adopt measures to speed up ballot processing and delivery ahead of the Georgia runoff elections after discussions with civil rights groups, The Washington Post reported.
The organization agreed to treat ballots as express mail if they were still in a processing plant in the three days before the election. That means mail-in ballots would be delivered the next day. Additionally, ballots being sent from a New York printer to the state would be fast-tracked, and the postal service will sweep facilities to ensure no ballots are misplaced.
In Atlanta, the USPS agreed to skip the processing plants and directly send the ballots to vote-counting centers.
The new policy is a result of challenges from groups like the NAACP Legal Defense Fund and Vote Forward.
The Atlanta voting district has seen a low rate of ballots arriving on time to mail processing centers, The Post reported. Only 80.4% of the over 150,000 mail ballots in that district that have already been processed were on time, but experts told the newspaper that the rate should be closer to 97%.
Across the country, a record number of mail-in-ballots was recorded during the November general election, and civil rights groups expect Georgia, and especially the Atlanta area, which is the most populous and diverse, to also surpass its own records during the runoffs.
Two Democrats, Raphael Warnock, and Jon Ossoff are working to unseat Republican Sens. Kelly Loeffler and David Perdue.
This also comes amid high scrutiny of the US Postal Service, after it determined it would have a hard time delivering an avalanche of packages by Christmas. In some cases, mail parcels are stacked so high that it’s difficult for employees to walk around, packages are sitting on trucks for several days waiting to be sorted, and employees are working as many as 80 hours per week.
The agency has said the delays are due to the coronavirus pandemic. Almost 25% or 19,000 of the agency’s 644,000 workers are sick or in isolation due to COVID-19.
“Amid the historic volume, the Postal Service continues to flex its network, including making sure the right equipment is available to sort, process, and deliver a historic volume of mail and packages this holiday season,” Kim Frum, a spokesperson for the Postal Service told Insider.
“Our entire Operations team, from collections to processing to delivery, worked throughout this past weekend and continues to work around the clock to address the historic volume.”
FedEx is placing daily package limits on some businesses as its shipping network faces capacity issues during the pandemic-fueled surge in online holiday shopping.
Carriers have taken similar steps before, but small business owners told Business Insider that FedEx hasn’t been transparent about the current wave of quotas, which have been as low as 75 packages per day and hit them right before Black Friday and Cyber Monday.
Shipping experts told Business Insider that smaller businesses are likely getting hit the hardest because of worse access to customer support, fewer resources to make alternative shipping arrangements, and less bargaining power with FedEx.
The pandemic has also forced UPS, Amazon, and other major carriers to impose restrictions on businesses and scramble to add capacity during what experts have called “shipageddon.”
Like many e-commerce businesses, Letterfolk held its annual holiday sale early this year – the week before Black Friday – in an attempt to get customers’ orders to their doorsteps before the pandemic-fueled surge in online shopping overwhelmed mail carriers.
Letterfolk, which makes bespoke letter boards and other home decor and is based in Salt Lake City, Utah, has four full-time employees and five to 10 part-timers during peak season. But on the Saturday after its sale, co-founder Johnny Galbraith had gathered all hands on deck, even rounding up family and friends to help fulfill the flurry of orders.
“We were feeling great because we had done our holiday sale early, we had about 3,000 orders in the queue, and that was after already having shipped out a decent volume,” Galbraith said.
But when he got home Saturday night, Galbraith got a call from his FedEx representative, who told him Letterfolk would be capped at its September shipping levels plus an additional 10%.
“The math on that worked out to be 110 packages a day,” Galbraith said. That equaled out to less than 4% of the orders his company was waiting to ship that Saturday.
“We had been pretty loyal to FedEx, probably 75% of our shipping business has gone through them, the [remaining] balance going through USPS, and so we didn’t really have any contingency plans,” Galbraith said. He attempted to find a workaround, even offering to personally drive the packages more than 400 miles to larger FedEx hubs in Denver or Las Vegas, but was unsuccessful.
“I felt like this could really compromise our entire small business operation. We’ll lose the trust of our customers,” he said. “And then to apply it the week before Black Friday with no warning, it was just unbelievable. It was just crazy to have to adapt to that among all the other challenges that a year with COVID is presenting.”
Galbraith isn’t alone, either in being capped by FedEx this holiday season or in facing challenges getting clear answers from the company about the quotas.
Business owners from Portland, Oregon, to Toronto, Canada, told Business Insider they’ve faced daily limits of just a fraction of their expected shipping volume – in one case as low as 75 packages per day – and in some instances weren’t told about the limits by FedEx ahead of time.
“FedEx expected an unprecedented surge in packages during this season, and we implemented various measures proactively to prepare. This included hiring more than 70,000 seasonal workers, moving to seven-day operations and accelerating Sunday delivery capabilities, improving the efficiency of our delivery routes, and, as always, proactively working with our customers to understand their expected volume and identify opportunities to ensure the best possible service throughout the season,” FedEx spokesperson Janna Hughes told Business Insider in a statement.
“In some cases, volume has significantly exceeded customer projections. We know how important it is to our customers that their packages are delivered on time, and we remain committed to working with them on ways to leverage our network flexibility,” she added.
FedEx and other carriers have been forced to take extreme steps to prepare for the unprecedented holiday rush expected this year as COVID-19 exposure risks drive more shoppers online and more packages into carriers’ shipping networks.
Scott Wingo, co-founder of e-commerce software company ChannelAdvisor and the host of an e-commerce podcast, coined it “shipageddon.“
According to analysis from eMarketer, online shopping is expected to grow 35.8% this year, and logistics data company ShipMatrix recently told the Wall Street Journal that, between Thanksgiving and Christmas, it expects there to be an excess of about 7 million packages per day that the shipping industry won’t have the capacity to ship.
Earlier this month, The Wall Street Journal reported that UPS imposed limits on major retailers, including Nike, Gap, L.L. Bean, Hot Topic, Newegg, and Macy’s. Last week, CNBC reported that Amazon had capped the number of products third-party sellers can ship to its warehouses, causing them to lose out on some holiday sales.
Jason Goldberg, chief strategist for RetailGeek and co-host of the podcast with Wingo, told Business Insider that, while carriers have rolled out package limits and higher rates in past years in response to increased shipping volumes, rarely did they actually refuse to pick up packages.
Another key difference with companies like Letterfolk, he said, is that while FedEx has conversations with larger retailers months in advance in order to estimate how much they’ll need to ship, many smaller businesses don’t have that level of access to FedEx or the leverage to negotiate better prices and quotas.
“Nike or Gap were not surprised in the slightest that they hit their caps… they knew what their cap was, they were informed well in advance,” he said. “It’s more likely to be a surprise for the smaller shipper.”
While it’s possible a particular business owner may have missed communication from FedEx about the caps, Goldberg said that multiple businesses in an e-commerce group he belongs to reported being blindsided by FedEx’s limits.
‘Caught us off guard’
That was the case for Second Closet, a Canada-based self-storage company that began using its warehouse space to help businesses fulfill their e-commerce orders during the pandemic.
“We found out one day, about a week before Black Friday Cyber Monday, that FedEx was going to cap us at 80 shipments a day,” Jarrett Stewart, senior operations manager at Second Closet, told Business Insider.
But Second Closet didn’t find out about its own quota directly from FedEx – it only learned about the new caps from one of its own merchants. That business had received an email from a FedEx representative with instructions not to send more than 80 packages per day on Cyber Monday and the day after.
“Basically, if you have 100 packages on Monday, please have the warehouse hold back 20 packages until the following day. The volumes in the network are extremely high at the moment and will get even more crazy over the next week, so we just need to manage capacity,” the FedEx rep said in the email, which was seen by Business Insider.
“Moving forward, I now have to submit and get approval when you are shipping 30 packages or more, which can take some time,” they added.
That email implied the caps might only apply during Black Friday and Cyber Monday, Stewart said. But that Thursday, the merchant received another email from FedEx asking the merchant to remind Second Closet about its daily limits after they shipped 135 packages on Wednesday, suggesting the caps had been extended.
“Caught us off guard, and it wasn’t for the lack of asking for a heads up,” Stewart said, adding that while FedEx had warned Second Closet about possible delays this holiday season, it provided nothing beyond “generic statements” when he asked about the caps.
As a result, Stewart said, Second Closet couldn’t “set expectations with merchants on a proactive basis,” and has had to issue refunds in some cases.
‘Highly chaotic and disorganized’
Multiple small business owners said they were similarly frustrated at the lack of clarity from FedEx around who would face shipping limits, how the limits were determined, how long they would be in place for, and whether they could help reduce some of the bottleneck by dropping off shipments at FedEx’s hubs.
“The little guys are complaining that it’s highly chaotic and disorganized and that no one’s taking their calls and they’re getting bad information… the communication is very spotty and ad hoc,” RetailGeek’s Goldberg said.
Stewart said FedEx has not been as responsive as other carriers in answering his questions about peak season challenges, adding: “They will always point you towards their different phone numbers, to different emails for customer support, so it’s hard to have that one-to-one relationship with an account rep.”
“It’s really been inconsistent,” another business owner in Portland, Oregon, told Business Insider. “The day after Cyber Monday, they called and said we were capped at 150 units. We brought everything else to our FedEx hub, and they were okay with that. Then the word from our account manager was we’re capped at 150 unless there is more room in the truck.”
Several business owners said they also tried to bypass their shipping limits by dropping packages at FedEx’s distribution hubs, to varying degrees of success – but that also introduces other issues.
“There is a big loophole in this whole system… FedEx and UPS are not in the business of turning away packages,” Goldberg said, “so they don’t actually have a robust infrastructure to enforce those caps.”
“If you drive those packages to a distribution center or a FedEx store and drop them off, they’re highly unlikely to get refused because they don’t even get scanned when you drop them off… they’re going to get processed later,” he said. “A lot of small sellers have bypassed their caps by just finding some alternative way to get them into the network.”
‘A small guy can’t do that’
While FedEx declined to share details about how it determines daily limits, experts said smaller businesses are likely being hit the hardest.
“I’ve been particularly worried about the small merchant,” Wingo told Business Insider. “The problem is, they don’t have the ability to go and negotiate a quota.”
Larger businesses can, as part of larger conversations around things like exclusivity and shipping rates, also tell FedEx what they expect to ship and negotiate higher shipping limits.
“A small guy can’t do that. You just don’t have the financial leverage,” Wingo said.
“Think about who FedEx least wants to alienate for next year,” Goldberg said. “It’s a Walmart, right? It’s not the mom and pop shipper.”
Galbraith said he understood that dynamic, admitting Letterfolk is “a drip in the ocean of packages that FedEx is moving.” But, he added, “I was hoping to hear more from FedEx about this issue… to make sure that you’re not being singled out as a small business owner.”
“I understand if it was being applied consistently,” he continued. “But a couple hundred packages for a small business – it kneecaps everything that we’re doing. And so for us to come out of this and then give FedEx all of our business again… I just don’t see that happening.”