Return fraud to hit $3.7 bn this Holiday Season - NRF Survey
08 Nov '07
2 min read
As retailers across the country gear up for increased holiday sales, they are also bracing for higher returns, some of which will be fraudulent.
According to the National Retail Federation's second annual Return Fraud Survey, loss prevention executives anticipate that nearly nine percent (8.93%) of holiday returns will be fraudulent, up slightly from 8.67 percent last year.
As a result, return fraud will cost retailers an estimated $3.7 billion this holiday season, up from $3.5 billion last year. Retailers will lose $10.8 billion to return fraud in 2007.
Despite the prevalence of fraud, more than a third of retailers (35.0%) have stated they made their return policies more lenient during the holidays to accommodate holiday shoppers. Common practices include retailers extending the amount of time for returns to be made and also being more flexible to customers without a receipt.
“Many retailers offer more lenient return policies during the holiday season to accommodate honest customers,” said NRF Vice President of Loss Prevention Joseph LaRocca . “But unfortunately, retailers must constantly balance the desire to take care of their customers with the undisputed fact that criminals are constantly looking to take advantage of return policies.”
According to the survey, completed by 60 retail loss prevention executives last month, nine out of ten retailers (92.0%) have had stolen merchandise returned to stores within the past year.
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