FEATURE: Holiday Return Fraud to Cost Retailers Billions
Retailers are estimating that holiday return fraud will total $2.2 billion this year, compared to roughly $1.9 billion from last year. This finding comes from the National Retail Federation’s latest survey, “Return Fraud Survey” which found that vendors are expecting 3.5% of holiday returns this year to be fraudulent.
Bob Moraca, the National Retail Federation’s VP of loss prevention commented: “Return fraud remains a critical issue for retailers with the impact spanning far and wide, in-store and online. While technology has played a significant role in deterring many in-person fraudulent transactions that would have otherwise gone unseen, there is little that can be done to prevent a determined criminal who will find a loophole one way or another. When it comes to retail fraud, retailers can build taller walls, but criminals continue to find taller ladders.”
One particular fraudulent return category involves the return of stolen merchandise, a category that generated concern from 91.9% of survey respondents. The second greatest concern involves the return of used or non-defective merchandise as cited by 72.6% of respondents.
On a more positive note, 75.8% of those polled experienced the return of merchandise purchased on a fraudulent tender, down by 81.8% the year prior. One possible reason for fraud in this area can be attributed to the growing use of e-receipts. One third of retailers experience return fraud by way of e-receipts, up 18.2% from last year’s figure.by