Note: This case study represents a snapshot in time, intended to provide insights into the administration of a complex enforcement action. Subsequent work may have been performed.
Regulatory Compliance
September 16, 2025
Administering Complex Government Enforcement Actions
The Situation
United States v. Epsilon Data Management, LLC; United States v. KBM Group, LLC
The United States Department of Justice (DOJ), the United States Postal Inspection Service and other law enforcement partners, investigated two separate companies that provided consumer data to fraudulent mass-mailing schemes. Such alleged schemes typically targeted elderly Americans and involved sending letters by mail promising prizes and other rewards upon the payment of a fee.
In January 2021, Epsilon Data Management LLC (Epsilon) entered into a Deferred Prosecution Agreement (DPA) with the DOJ and agreed to pay $127,500,000 to compensate victims of these fraudulent mass-mailing schemes that had received consumer data from Epsilon. In June 2021, KBM Group LLC (KBM) entered into a DPA with the DOJ and agreed to pay $33,500,000 to compensate victims of fraudulent mass-mailing schemes that had received consumer data from KBM.
Seven Groups of Victims
In the course of this four-year administration, the DOJ provided Kroll with six separate sets of victim data each containing victim names, addresses and payment amounts, referred to as Compensable Victim Sets. A seventh data set prepared by Kroll consisted of potential heirs of deceased victims. Kroll’s procedures for administering each of the seven data sets were governed by their own separate statements of work.
- Based on the first Compensable Victim Set, Kroll mailed initial notices to 264,549 victims.
- Based on the second Compensable Victim Set, Kroll mailed initial notices to 163,694 victims.
- Based on the third Compensable Victim Set, Kroll mailed initial notices to 271,767 victims.
- Based on the fourth Compensable Victim Set, Kroll mailed initial notices to 57,275 victims.
- Based on the fifth Compensable Victim Set, Kroll mailed initial notices to 40,987 victims.
- Based on the sixth Compensable Victim Set, Kroll mailed initial notices to 37,275 victims.
- The seventh data set prepared by Kroll consisted of victims’ heirs and contained 8,182 names, addresses and payment amounts for potential heirs of deceased victims whose loss amounts were $5,000 and above.
Upon receipt of each Compensable Victim Set received from DOJ, Kroll scrubbed each Compensable Victim Set through the National Change of Address (NCOA) database to obtain updated addresses. Next, Kroll ran each Compensable Victim Set through a survivorship status database to search for victims who may have died. Finally, Kroll applied a unique identification number to each victim’s record. Upon completion of these three data processing steps, the updated file referred to as an Enhanced Data Set was returned to the DOJ via its secure file sharing system.
Because victim records were continuously updated throughout this administration, Kroll uploaded our entire victim database to the DOJ secure file sharing system on a weekly basis during this administration.
A Unique Data Challenge and Kroll’s Solution
For five of the six victim data sets, the DOJ provided Kroll with spreadsheets containing victim names, addresses and payment amounts. However, for one of the victim data sets, the DOJ presented Kroll with a hard drive containing approximately four million images of checks of varying image quality and data from an entity called PacNet, which was a check processing company used by bad actors. The PacNet data included bank routing and account numbers and dollar amounts for checks, but no names.
- Kroll’s first step was to de-duplicate the four million check images based on bank routing and account numbers. This yielded approximately 1,200,000 unique bank routing and account numbers.
- Kroll then built a targeted Optical Character Recognition (OCR) process to capture printed information on the checks, specifically to capture the printed name and address on the upper left corner of each check and capture the printed routing and account number on the bottom of each check.
- Many victims had multiple check images on the hard drive. If a victim’s first OCR result did not match a routing and account number in the PacNet data, Kroll performed an OCR scan on a second check, if available. This process continued until an OCR match occurred or until a victim had no additional checks to OCR.
- Kroll then compared the bank routing and account numbers in the OCR results to bank routing and account numbers in the PacNet data. The OCR results contained name(s) and addresses while the PacNet data did not. The PacNet data contained payment amounts while the OCR process cannot capture the hand-written portions of the check images, such as the check amounts.
- The OCR results successfully matched to PacNet data were referred to as Match Data Set 2. Kroll performed random quality control, to verify that the OCR results matched the printed information on the check images, as well as a limited manual review of Matched Data Set 2 to look for misspelled or mistyped names and/or addresses.
- Kroll then applied the same Enhanced Data Set steps to the Matched Data Set 2, running it through the NCOA database, the survivorship status database and applying a unique identification number to each victim’s record. Kroll then uploaded Enhanced Data Set 2 to DOJ. Subsequently, the DOJ uploaded to Kroll Compensable Victim Set 2 identifying certain victims along with payment amounts. Compensable Victim Set 2 identified 163,694 victims for Kroll to attempt to compensate.
Heirship Claim Process
Because the victims of these fraudulent activities tended to be elderly, many victims had passed away before these funds became available for distribution. Therefore, in an effort to distribute as much of the fund as possible, for deceased victims with losses of $5,000 or more, the DOJ approved an heirship claims process to allow heirs of some deceased victims to present claims and receive payments.
Kroll began the heirship claims process by preparing a list of deceased victims with losses of $5,000 or more based on searching DOJ’s Compensable Victim Sets. Kroll then scrubbed this list of deceased victim names/addresses through an heir’s database to identify potential heirs. Kroll mailed 8,162 Heirship Claim Forms to potential heirs, requiring the form to be completed and returned along with proof of legal entitlement to any payments, such as a trust, a will or a probate order. As a consequence of this heirship process, Kroll issued approximately 1,000 payments and $3,729,175 dollars to heirs of deceased victims.
The Notice Program
Kroll prepared first drafts of all victim outreach materials, including the original notices, reminder notices, postcard and email notices, outbound call scripts and website content for each of the different victim data sets, which were circulated to the parties for review and approval.
When the DOJ provided Kroll with each Compensable Victim Set, Kroll mailed the initial notice, which informed victims of their eligibility to receive a payment and their payment amount. Within 60 days of mailing the initial notice, Kroll mailed payments along with a cover letter to the compensable victims.
Cumulatively, for the seven Compensable Victim Sets, Kroll mailed a total of 850,385 initial notices to victims and mailed a total of 838,422 checks to victims.
Victim Communications Support
Kroll provided weekly live operator phone support Monday through Fridays, 8a.m. to 9p.m. ET, and offered Interactive Voice Response (IVR) during other times of the day and on weekends. Kroll provided teletypewriter (TTY) services as a means for victims with disabilities to communicate effectively. We also collected and reported certain metrics on a weekly basis to the parties, notably including the top three topics victims raised with call center operators each week.
In addition, Kroll provided multiple options for victim communications via our informational websites, phone, email and fax.
Cumulatively, Kroll received:
- Total number of live operator calls: 180,043
- Total number of hours/minutes on live operator calls: 6,643 hours, 20 minutes
- Total number of IVR calls: 75,870
- Total number of hours/minutes on IVR calls: 9,587 hours, 3 minutes
Three Different Outreach Efforts for Uncashed Checks
Within 60 days of mailing checks to victims, Kroll commenced a reminder outreach campaign to victims whose checks remained uncashed. Specifically, Kroll mailed reminder postcards, sent reminder emails and placed outbound reminder phone calls to victims who had not yet cashed their checks. The outbound reminder calling campaign included up to four call attempts per victim.
For the seven Compensable Victims Sets, Kroll’s reminder outreach efforts totaled:
- Reminder Postcards mailed: 520,305
- Reminder Emails sent: 324,900
- Reminder Outbound Calls placed: 847,288
The Distributions
- Total Number of checks issued: 838,435
- Total Number of checks cleared: 437,827
As required, undistributed funds were returned to the government.
Conclusion
Of the $160,000,000 allocated for victims and their heirs, Kroll distributed more than $130,000,000, or over 81% of the funds. This was accomplished through various efforts, including notice mailings, remailings, seven rounds of check cashing reminders via postcards, emails, and outbound calling campaigns.
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