Angering customers can lead to reputational damage. You have no definitive way of verifying their claim, though.Įven if you suspect fraud, you don’t want to risk alienating customers by making unprovable accusations. Customers can use a lot of different excuses to claim a return. For instance, there’s the fact that a claim can often be your word against the cardholder's. There are several reasons why many merchants turn a blind eye to suspected return fraud.
However, the return request is invalid, as the customer does not have a legitimate right to a refund for one reason or another. Return fraud happens when consumers bring an item (or items) back to you to request a refund in the form of store credit or cash. The merchandise may be ineligible for a refund because it was purchased from another retailer, because the item is used, or was marked as otherwise ineligible for a refund before purchase. Return fraud refers to the act of returning merchandise to a retailer for a refund in violation of the merchant’s stated return policy.
