Black Friday has finally arrived. Shoppers across the country are walking the aisles or scouring the net for the best deals that they can find, but tensions for retailers also run high on this pseudo-holiday. Not only do they have to handle a veritable flood of customers, but they must remain vigilant when it comes to spotting scammers.
The Chicago Tribune reports that return fraud is very high on this pseudo-holiday; in 2015, retailers lost an estimated $15 billion to these schemes. While some consumers may try to shrug that number off, it has some real economic consequences – not only are retailers losing out on all that revenue, but prices may rise to make up for the losses. The Tribune details four scams that retailers will be looking out for this year.
Black Friday scams
The “hot exchange” scam is an old standby that is favored by thieves. It occurs when a fraudster steals an item from a store and tries to return it for cash. While it might be hard to get away with stealing a bigger item – like a large TV – smaller items can often be secreted away for the purposes of the scam.
The second scam is one that many consumers may have considered at one time or another for a big event, but employees will be keeping a close eye on it this year. The “rent and return” scam occurs when a person buys an item that they use once and then return for a full refund; it usually involves clothing or jewelry. Stores have dubbed the practice “wardrobing,” and experts estimate that 72% of retailers have been fooled by it.
The third scam – another old standby – involves using counterfeit bills to make a purchase. Scammers pay for the item with false currency and later return the item for a full refund of “real” money, store credit, or a gift card. Around 75% of retailers say they have experienced this kind of scam.
The fourth and final scam may be the most difficult for stores to monitor because it happens from inside. Some scammers will collude with a store employee to write up a phony return claim on an item that can be returned for cash. Most of the time, though, the item was never bought and the guilty parties split the money. Seventy-seven percent of stores have been plagued by this kind of scam.
Always another scam
While the scams detailed above are more “physical” and straightforward, retailers also have to be on the lookout for e-fraud. Savvy hackers will often try to get their hands on e-receipts to get refunds on items that they never bought.
Unfortunately, cracking down on every kind of fraud is nearly impossible. Scammers are constantly plying their trade and finding new ways to get away with their ill-gotten gains. “The criminal creativity is seemingly endless and mind-boggling,” commented Rob Karr, CEO of the Illinois Retail Merchants Association.