The U.S. Postal Service has launched a redesigned money order this month with added security features to deter a post-pandemic uptick in mail fraud.

The upgraded red, white and blue design adds a watermark, holographic security thread and QR code directing users to the USPS website. It also replaces the paper used on the older green documents with “tamper-resistant material.”

Fraud experts interviewed by The Washington Times said the new features will make it harder for criminals using specialized printers and software to counterfeit the document.

They said the design update could also help federal agents identify suspicious transactions and larger-scale frauds such as fake lotteries, bogus sweepstakes, and romance scams that involve soliciting money through the mail from unsuspecting victims.

“I think everyone benefits from the added security features,” said Mike Martel, a postal inspector and spokesman at the U.S. Postal Inspection Service, which investigates mail crimes. “There are a whole host of scams out there right now. Always remember that if it seems too good to be true, it probably is.”

Millions of Americans purchase money orders annually from the post office, banks and grocery stores to send payments more securely through the mail. Each money order is capped at $1,000.

In 2023, the last year of available data, the Postal Service said it issued 63.3 million money orders.

The Treasury Department’s Financial Crimes Enforcement Network, or FinCEN, estimates that the annual number of money order frauds jumped from 18,583 in 2019 to 23,191 in 2020 during the first months of COVID-19 health restrictions. That’s the highest in 11 years of annual data from 2014 to 2024.

“Data on victim costs, however, is not available,” the agency said in an email to The Times. “FinCEN declines further comment.”

Under federal law, money order fraud is punishable by a fine or up to five years in prison.

The tally of money order frauds dropped to 14,920 last year. According to federal officials, that’s partly because the Postal Service has taken steps to crack down on an uptick in mail theft, check fraud, and mail carrier robberies since the pandemic.

“There’s been a democratization of technology that is continually improving,” Mr. Martel said. “Thieves can just buy printers and software off the internet that they couldn’t easily get 20 years ago.”

Mr. Martel said digital technology allowed thieves to purchase a money order for $5 at the Post Office, use printers and software to remove the amount, and reprint the order for a few hundred dollars more.

Other cases involve counterfeit money orders or scammers tricking older victims into sending them money orders as part of larger scams. According to experts, older Americans account for the majority of money orders, leaving them especially vulnerable.

In an annual report last year, the Postal Inspection Service reported learning that The Blossoms Experience, a Miami hydroponics shop, had become the top purchaser of postal money orders in South Florida.

Subsequent investigation revealed a sweeping mail order scam and roughly $22 million in cash hidden behind the walls of the home of Luis Hernandez, the store’s co-owner.

In some cases, thieves have also counterfeited money orders to access victims’ checking accounts. Economists say it’s not uncommon for scammers to mail out a fake money order, ask the victims to deposit it, and then demand a partial refund directly from their checking accounts.

“These scams often rely on the delay between the deposit and the discovery of the fraud, allowing scammers to receive real money before the counterfeit is detected,” said Christopher Tang, a UCLA business professor who studies money supply issues.

Mr. Tang said the USPS redesign was long overdue because “the old money order design had several vulnerabilities that fraudsters exploited,” including a lack of “modern verification tools” they could have used to identify convincing fakes.

According to financial investigators, money order fraud has contributed to a rise in more lucrative crimes since the pandemic, such as overpayment scams involving wiped checks and stolen bank routing numbers.

Mark Solomon, head of the International Association of Financial Crimes Investigators, noted that fraudsters prey on the perception that money orders are “more trustworthy” than personal checks.

He called the Postal Service redesign “a positive step” toward protecting people from scammers who use money orders as a Trojan horse to get into their bank accounts.

“By far, the biggest threat with counterfeiting is still personal and business checks,” Mr. Solomon said. “Because there is no uniformity or standardization of these checks, criminals have free will to counterfeit checks and often are successful.”

Angelica Gianchandani, a marketing instructor at New York University, said Artificial Intelligence will likely provide the next upgrade to money order security features.

But she also predicted that money orders could die off entirely as emerging generations embrace digital payment as the safest way of transferring cash.

“While AI-driven innovations will streamline and secure transactions, they may also eventually phase out traditional money orders as faster, safer, and more convenient digital alternatives become the norm,” Ms. Gianchandani said.

• Sean Salai can be reached at ssalai@washingtontimes.com.