As North and South grew closer to war in early 1861, the Federal government continued postal service in the South for a limited time. However, U.S. post offices across the South held substantial stamp inventories and the Federal government feared they would be used or sold for profit. To this end, the U.S. government declared that all existing U.S. stamps would be demonetized (declared invalid) as of June 1, and U.S. postal operations in the South would cease on that day. As a result, the Confederate Post Office Department was formed in February 1861. John Henninger Reagan was appointed Postmaster General of the Confederate Post Office in March of 1861. Reagan persuaded many of the U.S. Post Office’s most talented bureau heads to follow him to the Confederacy. Several brought their records and account books with them.