Did you know that return fraud is costing the retail industry billions of dollars in revenue? Many stores do not have effective ways to detect return fraud. If this issue remains unresolved it can determine whether your business will continue to stay afloat or not.
“Return fraud” is returning retail merchandise with the intent to get a refund (whether cash or store credit) even though you are violating the retailer’s returns policy.
Sometimes this can happen innocently, but lately, this type of fraud has become a business or side hustle for some people.
It is not only a small percentage of shoppers taking advantage of this crime but even illegal businesses or your competition, trying to move your inventory to make a quick buck at your expense.
So, what defines the line between an innocent mistake and the illegal act of return fraud?
We believe that, in order to get a clearer picture of the intentions behind a suspicious return, we can track the data on each client’s account to recognize a pattern of their shopping behavior before jumping to assumptions.
Having a good return policy creates a certain level of trust and satisfaction with the shoppers you do want in your business. But it is important to be aware of the main traits to look out to protect yourself from those with ill intentions.
Return fraud is illegal. In most U.S. states it is recognized and treated as theft or robbery. Meanwhile, in other states, it is recognized as a felony or misdemeanor. Return fraud is being taken more seriously and so are the repercussions following this crime.
Return fraud is a delicate matter and should be treated as such. Even if you might be suspicious of a specific return or client account, it is very important to remain calm. Never make any accusations you cannot prove because that could lead to losing customers and damaging your business’s reputation.
Know the most common types of return fraud and look out for patterns in behaviors. Not all returns are bad, that is why the most important step to prevent this type of fraud is by first revising your return policy, especially during the holiday season.
The industry of counterfeiting is rampant. There are many variations to return fraud, the things you need to look out for are:
You can also hire a company like Real Authentication as your professional authentication service to track this data for you and help you protect your business from return fraud.