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Returns fraud continues to pose a serious threat to retail

Wednesday 28 November 2018 11:12 CET | News

The National Retail Federation (NRF) recent study has revealed that returns fraud continues to pose a serious threat to the retail industry.

According to the study, 11% of retailers’ annual sales will be returned this year, and 8% of those returns are likely to be fraudulent. And while the NRF surveyed loss prevention professionals at department stores, big-box stores, and other retailers, it seems likely that returns fraud would be at least as high if not higher for online sellers.

Other results show that 38% reported in an increase in online purchases being returned to a bricks-and-mortar location, and 29% cited an increase of those returns being fraudulent.

During the holiday season, retailers expect 11% of sales to be returned, on average, down from 13% last year, and that 10% of the returns will be fraudulent, down from 11% last year.

The NRF noted that organized retail crime losses (ORC) is a growing problem, with 92% of companies surveyed reporting they had been a victim of ORC in the past year, with 71% reporting that ORC incidents were increasing. Losses averaged USD 777,877 per USD 1 billion in sales, up 7% from last year’s previous record of USD 726,351. Retailers said online selling contributed to the problem, with criminals targeting items that could be easily stolen and quickly resold.


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Keywords: returns fraud, commerce, retail, merchants, NRF, survey, report, holiday shopping, ecommerce fraud
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Countries: World