Trump panel wants to give USPS right to hike prices for Amazon, others

FILE PHOTO - A view shows U.S. postal service mail boxes at a post office in Encinitas, California in this February 6, 2013, file photo. REUTERS/Mike Blake/Files

By Diane Bartz and Jeffrey Dastin

WASHINGTON (Reuters) – The United States Postal Service should have more flexibility to raise rates for packages, according to recommendations from a task force set up by President Donald Trump, a move that could hurt profits of Amazon.com Inc and other large online retailers.

The task force was announced in April to find ways to stem financial losses by the service, an independent agency within the federal government. Its creation followed criticism by Trump that the Postal Office provided too much service to Amazon for too little money.

The Postal Service lost almost $4 billion in fiscal 2018, which ended on Sept. 30, even as package deliveries rose.

It has been losing money for more than a decade, the task force said, partially because the loss of revenue from letters, bills and other ordinary mail in an increasingly digital economy have not been offset by increased revenue from an explosion in deliveries from online shopping.

The president has repeatedly attacked Amazon for treating the Postal Service as its “delivery boy” by paying less than it should for deliveries and contributing to the service’s $65 billion loss since the global financial crisis of 2007 to 2009, without presenting evidence.

Amazon’s founder Jeff Bezos also owns the Washington Post, a newspaper whose critical coverage of the president has repeatedly drawn Trump’s ire.

The rates the Postal Service charges Amazon and other bulk customers are not made public.

“None of our findings or recommendations relate to any one company,” a senior administration official said on Tuesday.

Amazon shares closed down 5.8 percent at $1,669.94, while eBay fell 3.1 percent to $29.26, amid a broad stock market selloff on Tuesday.

The Package Coalition, which includes Amazon and other online and catalog shippers, warned against any move to raise prices to deliver their packages.

“The Package Coalition is concerned that, by raising prices and depriving Americans of affordable delivery services, the Postal Task Force’s package delivery recommendations would harm consumers, large and small businesses, and especially rural communities,” the group said in an emailed statement.

Most of the recommendations made by the task force, including possible price hikes, can be implemented by the agency. Changes, such as to the frequency of mail delivery, would require legislation.

The task force recommended that the Postal Service have the authority to charge market-based rates for anything that is not deemed an essential service, like delivery of prescription drugs.

BAD NEWS FOR AMAZON

“Although the USPS does have pricing flexibility within its package delivery segment, packages have not been priced with profitability in mind. The USPS should have the authority to charge market-based prices for both mail and package items that are not deemed ‘essential services,'” the task force said in its summary.

That would be bad news for Amazon and other online sellers that ship billions of packages a year to customers.

“If they go to market pricing, there will definitely be a negative impact on Amazon’s business,” said Marc Wulfraat, president of logistics consultancy MWPVL International Inc.

If prices jumped 10 percent, that would increase annual costs for Amazon by at least $1 billion, he said.

The task force also recommended that the Postal Service address rising labor costs.

The Postal Service should also restructure $43 billion in pre-funding payments that it owes the Postal Service Retiree Health Benefits Fund, the task force said.

Cowen & Co, in a May report, said the Postal Service and Amazon were “co-dependent,” but that Amazon went elsewhere for most packages that needed to arrive quickly.

Cowen estimated that the Postal Service delivered about 59 percent of Amazon’s U.S. packages in 2017, and package delivery could account for 50 percent of postal service revenue by 2023.

The American Postal Workers Union warned against any effort to cut services. “Recommendations would slow down service, reduce delivery days and privatize large portions of the public Postal Service. Most of the report’s recommendations, if implemented, would hurt business and individuals alike,” the union said in a statement.

Amazon, FedEx Corp and United Parcel Service Inc did not return requests for comment.

(Reporting by Diane Bartz and Jeffrey Dastin; editing by Bill Berkrot)

Texas serial bomber made video confession before blowing himself up: police

Law enforcement personnel investigate the scene where the Texas bombing suspect blew himself up on the side of a highway north of Austin in Round Rock, Texas, U.S., March 21, 2018. REUTERS/Loren E

By Jon Herskovitz

PFLUGERVILLE, Texas (Reuters) – The serial bomber whose deadly attacks terrorized Austin, Texas, for weeks left a 25-minute video “confession” on a cell phone found after he blew himself up on Wednesday as officers closed in to make an arrest, police said.

Texas blast suspect Mark Anthony Conditt. Austin Community College/via REUTERS

Texas blast suspect Mark Anthony Conditt. Austin Community College/via REUTERS

Mark Conditt, 23, an unemployed man from the suburb of Pflugerville, detailed how he made all seven bombs that have been accounted for – five that exploded, one that was recovered before it went off and a seventh that he detonated as officers rushed his vehicle early on Wednesday.

But the video failed to reveal a coherent motive for the attacks spread over the past three weeks, police said.

“He does not at all mention anything about terrorism, nor does he mention anything about hate, but instead it is the outcry of a very challenged young man, talking about challenges in his personal life,” Austin Police Chief Brian Manley told reporters.

“I would classify this as a confession,” Manley said.

Conditt, who had never before been in trouble with the law, killed two people and wounded five with a campaign of violence that began on March 2, authorities said.

Based on their search of the suspect’s home and his video statement, authorities said they felt confident that there were no other bombs and that the public was safe from further harm.

FBI special agent Christopher Combs said investigators believe the suspect would have continued his attacks had he not been apprehended.

Police recovered a “target list” of addresses for future bombings, the Los Angeles Times reported, citing U.S. Representative Michael McCaul of Texas, the Republican chairman of the House Homeland Security Committee.

Even so, the video gave no explanation for the individuals and addresses singled out as recipients of the bombs that were planted or shipped, Manley said.

Police previously said they had considered the possibility that the attacks were racially motivated, noting that the first several victims, including the two who died, were either African-American or Hispanic.

Conditt likely recorded the video between 9 p.m. and 11 p.m. on Tuesday. According to Manley, Conditt said he believed police “were getting very close to him,” and he was right. Authorities filed a criminal complaint and issued an arrest warrant around that time.

A surveillance image shows the serial bombing suspect inside a FedEx office store in Austin, Texas, U.S., which was given to law enforcement and obtained by TV station, WOAI/KABB, March 21, 2018. Courtesy of WOAI/KABB/Handout via Reuters

A surveillance image shows the serial bombing suspect inside a FedEx office store in Austin, Texas, U.S., which was given to law enforcement and obtained by TV station, WOAI/KABB, March 21, 2018. Courtesy of WOAI/KABB/Handout via Reuters

By Wednesday morning, police had tracked Conditt to a hotel and were waiting for the arrival of tactical units and equipment before they planned to make an arrest, Manley said. But then Conditt drove away.

Police followed and decided to stop him before he got on the highway. Just as officers approached the vehicle, the explosion went off, Manley said. There was also some police shooting.

“This can never be called a happy ending, but it’s a damn good one for the people of this community, the people of the state of Texas,” Travis County District Attorney Margaret Moore told reporters.

Residents in Austin, a city of 1 million people and a liberal enclave of university students and tech companies, voiced relief that the hunt for the serial bomber was over.

“I am going to be leery and extra careful tomorrow at work, but I feel relieved now,” said Jesus Borjon, 44, an employee of parcel delivery firm UPS, who lives in Pflugerville.

Austin was hosting thousands of out-of-town visitors for its annual South by Southwest festival of music, film and technology when the first bombings occurred.

Law enforcement personnel investigate the surroundings of a house linked to the bomber in Pflugerville, Texas, U.S., March 21, 2018. REUTERS/Loren Elliott

TRAIL OF CLUES

The trail of clues leading hundreds of investigators to the serial bomber ranged from store receipts and fragments of booby-trapped packages to surveillance video of the suspect in a hat and wig.

Experts scoured the suspect’s home for further evidence on Wednesday, removing explosive materials and bomb components.

“I wouldn’t call it a bomb-making factory, but there’s definitely components consistent with what we’ve seen in all these other devices,” Fred Milanowski, special agent in charge of Houston office of the Bureau of Alcohol, Tobacco, Firearms and Explosives, told reporters.

Investigators evacuated a four-block radius around Conditt’s house while they searched the home, which Conditt shared with two roommates who had been detained for questioning. Conditt moved in a year ago after leaving his parents’ home about a mile (1.6 km) away, public records showed.

One law enforcement official involved in the investigation but speaking on condition of anonymity told Reuters that some of the materials found in remnants of the bombs were traced back to where they had been sold.

The source also said investigators, once they had identified Conditt as a potential suspect, obtained a warrant to monitor his Google search history.

Surveillance video showed the suspect in a hat and a blond wig, as he prepared to ship one of two booby-trapped packages he was known to have sent through FedEx Corp’s delivery service, according to the source.

He used the alias “Kelly Killmore” to ship those packages, ABC News reported, citing unnamed law enforcement sources.

Conditt, who was home-schooled, described himself as a conservative but said he was not politically inclined, according to blog posts he wrote as part of a U.S. politics class at Austin Community College. He attended from 2010 to 2012 and had no record of any disciplinary actions, the school said.

(Reporting by Jon Herskovitz; Additional reporting by Jim Forsyth in San Antonio, Brendan O’Brien in Milwaukee, Mark Hosenball in Washington, Jonathan Allen and Gina Cherelus in New York and Steve Gorman in Los Angeles; Writing by Daniel Trotta; Editing by Rosalba O’Brien, Peter Cooney & Simon Cameron-Moore)

Texas bombing suspect blows himself up as police close in

FILE PHOTO: Law enforcement personnel investigate an incident that they said involved an incendiary device in the 9800 block of Brodie Lane in Austin, Texas, U.S., March 20, 2018.REUTERS/Loren Elliott

By Jon Herskovitz

PFLUGERVILLE, Texas (Reuters) – An unemployed 23-year-old man suspected of a three-week bombing campaign in Texas that killed two people and injured five others before blowing himself up on the side of a highway was identified by local media on Wednesday.

The suspect was identified as Mark Anthony Conditt, of Pflugerville, Texas, according to the local CBS television affiliate and Austin American-Statesman newspaper, citing unnamed law enforcement sources. Reuters could not immediately confirm the suspect’s identity.

Public records showed Conditt’s age as 23. Officials had said the suspect was 24.

Police tracked the suspect to a hotel about 20 miles north of Austin, the state capital, and were following his vehicle when he pulled to the side of the road and detonated a device, killing himself, Austin Police Chief Brian Manley told reporters near the scene.

“The suspect is deceased and has significant injuries from a blast that occurred from detonating a bomb inside his vehicle,” Manley told reporters. He declined to further identify the suspect, except to say he was white.

Investigators had tracked him for a couple of days before closing in at an unidentified hotel in Round Rock, Texas, not for from his home in Pflugerville, Governor Greg Abbott told Fox News on Wednesday.

“We’ve known for a couple of days who the suspect likely was,” Abbott said. “Law enforcement is at his house in Pflugerville where we are learning whether or not that was the location he was making his bombs.”

The governor added that the suspect is believed to have lived with two roommates, who are not currently considered suspects, Abbott said. The suspect was not a military veteran, Abbott said.

Texas law enforcement officials blocked off the street where the suspect lived, not far from where the first bomb went off on March 2, killing one person.

Jay Schulze, a 42-year-old network engineer, said on Wednesday he lived a few houses away from the bombing suspect and that the suspect and his friends would hang out late at night.

“They would be out in back playing music and partying pretty late,” Schulze said.

While jogging on Tuesday night, Schulze noticed a heavy police presence in the area, with drones flying overhead. He said he was stopped briefly by a person who he thought was an FBI agent.

‘DO NOT UNDERSTAND’ MOTIVATION

Manley said the suspect was believed to be responsible for six bombs around Austin, all but one of which detonated. He said the motivation for the bombings or whether the suspect had help was not yet known.

Manley warned residents to be cautious since it was not clear whether any more bombs had been left around the city.

The bombings killed two people and injured at least five others, unnerving residents of Austin, a city of some 1 million people. The first bombings occurred as the city was hosting the annual South By Southwest music, film and technology festival.

While officers waited for reinforcements before they arrested him, the suspect left the hotel and police followed.

The suspect pulled off the city’s main highway and two Austin police officers approached his vehicle when he set off the device. One officer fired at the vehicle and the other sustained a minor injury when the bomb went off, Manley said.

U.S. President Donald Trump congratulated authorities on Twitter: “Great job by law enforcement and all concerned!”

The first three devices were parcel bombs dropped off in front of homes in the Austin area. A fourth went off on Sunday night, apparently detonated with a trip wire also around Austin, and a fifth exploded inside a FedEx Corp <FDX.N> facility near San Antonio on Tuesday.

The bombings bewildered authorities, who by Sunday had publicly called on the bomber to contact them and explain why he was carrying out the attacks.

The first two bombs killed black men, raising fears that they were part of a hate crime, but investigators said the blasts that came later and were more random made that less likely.

Manley said investigators have no clear idea of what prompted the suspect to carry out the bombing, saying, “We do not understand what motivated him to do what he did.”

(Reporting by Jonathan Herskovitz; Additional reporting by Brendan O’Brien in Milwaukee and Jonathan Allen and Gina Cherelus in New York; Writing by Scott Malone; Editing by Larry King and Jeffrey Benkoe)

Fifth device explodes in Texas, seen linked to others

A FedEx truck is seen outside FedEx facility following the blast, in Schertz, Texas, U.S., March 20, 2018. REUTERS/Sergio Flores

By Jon Herskovitz and Jim Forsyth

AUSTIN/SCHERTZ, Texas (Reuters) – A package bomb blew up at a FedEx distribution center near San Antonio on Tuesday, the fifth in a series of attacks that have rocked Texas this month and sent investigators on a frantic search for what they suspect is a serial bomber.

The package filled with nails and metal shrapnel was mailed from Austin to another address in Austin and passed through a sorting center in Schertz, about 65 miles (105 km) away, when it exploded on a conveyer belt, knocking a female employee off her feet, officials said.

It was the fifth explosion in Texas in the past 18 days and the first involving a commercial parcel service.

“We do believe that these incidents are all related. That is because of the specific contents of these devices,” interim Austin Police Chief Brian Manley told members of the Austin City Council, the Austin American-Statesman reported.

A second package sent by the same person was discovered and turned over to law enforcement, FedEx Corp said in a statement. Meanwhile police had surrounded yet another FedEx location in the Austin area after discovering a suspicious package there.

The series of bombings have unsettled Austin, the state capital of some 1 million people, and drawn hundreds of federal law enforcement investigators to join local police. Schertz lies on the highway between Austin and San Antonio.

Speaking through the media, officials have appealed to the bomber to reveal the motives for the attacks. They have also asked the public for any tips, offering a $115,000 reward for information leading to the arrest and conviction of the culprit.

White House spokeswoman Sarah Sanders said in a tweet: “We are committed to bringing perpetrators of these heinous acts to justice. There is no apparent nexus to terrorism at this time.”

The White House did not respond to a request for comment on whether it was ruling out both international and domestic terrorism.

“This is obviously a very, very sick individual, or maybe individuals,” President Donald Trump told reporters. “Theseare sick people, and we will get to the bottom of it.”

Investigators were trying to come up with a theory or intelligence regarding the motive for the bombings or identity of the bomber or bombers, a U.S. security official and a law enforcement official told Reuters.

Members of the media move cameras around before the start of a news conference outside the scene of a blast at a FedEx facility in Schertz, Texas, U.S., March 20, 2018. REUTERS/Sergio Flore

Members of the media move cameras around before the start of a news conference outside the scene of a blast at a FedEx facility in Schertz, Texas, U.S., March 20, 2018. REUTERS/Sergio Flores

The Federal Bureau of Investigation was investigating the FedEx package explosion as if there were a connection to the Austin bombings, the law enforcement official said. Both sources declined to be identified.

The individual or people behind the bombings are likely to be highly skilled and methodical, said Fred Burton, chief security officer for Stratfor, a private intelligence and security consulting firm based in Austin.

“This is a race against time to find him before he bombs again,” Burton said.

The four previous explosions killed two people and injured four others.

The first three devices were parcel bombs dropped off in front of homes on in three eastern Austin neighborhoods. The fourth went off on Sunday night on the west side of the city and was described by police as a more sophisticated device detonated through a trip wire.

The four devices were similar in construction, suggesting they were the work of the same bomb maker, officials said.

Federal authorities at the scene of Tuesday’s blast offered few details, telling reporters their probe was in the early stages and that the building would be secured before investigators could gather evidence.

The FBI and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) were among those working with local officials in Austin, Schertz and San Antonio.

“We have agents from across the country. We have our national response team here. We have explosive detection canines here. We have intel research specialists,” Frank Ortega, acting assistant special agent in charge of the San Antonio ATF office, told reporters. “We’ve been working around the clock.”

(Additional reporting by Brendan O’Brien in Milwaukee and Mark Hosenball and Lisa Lambert in Washington; Writing Daniel Trotta; Editing by Jeffrey Benkoe and Tom Brown)

FedEx says cyber attack to hurt full-year results

A Federal Express truck is shown on deliver in La Jola, California, U.S., May 17, 2017. REUTERS/Mike Blake

(Reuters) – Package delivery company FedEx Corp <FDX.N> said a disruption in services in its TNT Express unit following a cyber attack last month would hurt its full-year results.

FedEx’s shares fell as much as 3.4 percent to $211.53 in early trading as the company said the financial impact of the disruption on its results was likely to be “material”.

The Netherlands-based TNT Express is still experiencing widespread service delays following the attack, caused by the Petya cyber virus that spread through a Ukrainian tax software product, FedEx said.

FedEx said it lost revenue due to decreased volumes at TNT Express and incurred incremental costs from contingency plans and remediation of affected systems.

The company said it did not have an insurance in place that covered the impact from the cyber attack.

FedEx, which is evaluating the financial impact of the cyber attack, said it was unable to estimate when services at TNT Express would be fully restored. (http://bit.ly/2uAnQKG)

The company also said no data breach or data loss to third parties was known to have occurred as of July 17.

The Petya cyber virus spread from Ukraine in June, crippling thousands of computers around the globe, with the shipping and logistics industry among those hit the hardest.

The malicious code encrypted data on machines and demanded victims $300 ransoms for recovery, similar to the extortion tactic used in the global WannaCry ransomware attack in May.

FedEx is scheduled to report its first-quarter results in September.

(Reporting by Ankit Ajmera in Bengaluru; Editing by Maju Samuel and Saumyadeb Chakrabarty)