Return fraud cost U.S. retailers
billions of dollars during the holiday season in various forms,
according to an industry survey report released on Tuesday.
The National Retailer Federation (NRF) found the industry may lose 2.9 billion U.S. dollars to return fraud in November and December when Thanksgiving Day and Christmas Day take place, and 8. 9 billion dollars in the whole year, after surveying executives at 60 retail companies. Overall, retailers estimated 4.6 percent of holiday returns were fraudulent.
Return fraud may be in the form of criminals who return stolen merchandise, use counterfeit receipts, or even return items already worn or used that are not defective. NRF Vice President of Loss Prevention Rich Mellor noted that "innocent consumers often suffer because companies have to look for ways to prevent and detect all types of crime and fraud in their stores, oftentimes resorting to shorter return windows and limitations on the types of products that can be returned."
According to the survey, wardrobing, which means the return of used, non-defective merchandise like special occasion apparel and certain electronics, is a huge issue, with 64.9 percent of retailers saying they have been victims of this activity in the past year.
When it comes to holiday return policy, 83.1 percent of respondents from discount stores, department stores, drug stores, supermarkets and specialty stores said they won't change the existing policies.
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