Postcomm, the regulator, is finalising its first action against Royal Mail for jeopardising “mail integrity” and is expected to levy a substantial fine in the next few days.

The watchdog has found “a number of shortcomings”, but it is especially concerned about the use of agency staff by Royal Mail, which it feels were not scrutinised sufficiently. The report will ask Royal Mail to review its procedures.

Large-scale crime at Royal Mail has been revealed several times in recent years through undercover investigations such as Channel Four’s Dispatches programme and by high-profile court cases.

In December Dido Mayue-Belezika, a mail centre employee, was jailed for 6½ years for masterminding a £20 million scam involving stolen cheque books.

His case came after the imprisonment for 15 months of Chandan Patel, a postal worker, who stole 40,000 letters and greetings cards that had contained £80,000 in cash. Patel had focused on coloured envelopes because they were more likely to contain greetings cards and money. Dispatches showed undercover reporters being shown how to recognise banking post and how to dump sacks of letters.

After public concern over security at Royal Mail, Postwatch, the consumer’s organisation, has called for it to publish specific details of its stolen post.

At present, figures for stolen mail are included only within a broader published category of lost and substantially delayed mail. Last year the postal group reported that 15 million items had been lost or substantially delayed out of an annual mailbag total of 22 billion, equating to a 99.93 per cent success rate in delivering post safely.

Postcomm’s investigation into the integrity of Royal Mail’s letters and parcels delivery began two years ago and the regulator subsequently used the Dispatches investigation for further lines of inquiry.

A spokesman for Royal Mail said that the organisation had not yet seen the Postcomm report and so could not comment in detail.

However, he said: “We have reduced the number of temporary workers from a peak of nearly 25,000 in 2003 to around 1,000 now and all our new recruits are vetted.”

Royal Mail has previously been fined more than £7 million by Postcomm for failing to deliver first and second-class letters by their due date. It has also had to pay out tens of millions of pounds in compensation to business and domestic customers for poor service.

Since then its performance has improved and now it is meeting most of the delivery targets required by its licence to operate.

New rules for postcode database

TOUGHER guidelines are to be imposed on Royal Mail’s postcode service for businesses after concerns that some customers were being favoured over others.

Postcomm, the regulator, believes that some businesses were concerned that the Royal Mail’s postcode database, including updates, were not available to all users. The database of 27 million addresses helps businesses to quickly find much of a customer’s full address by using their postcode details only.

The regulator is thought to be concerned that all businesses did not have access to regular updates of the database. Postcodes are updated for new housing and business developments, as well as when postcodes specific to a particular company fall out of use.

Postcomm was anxious that Royal Mail acted with impartiality in dealing with the postcode list because it was the sole owner of the information.

Royal Mail charges businesses a minimum of £750 a year for the service, with charges increased according to the number of registered users within each business.

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