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How Retail Can Navigate Phony Claims This Holiday Season

With Covid-19-related shutdowns and stay-at-home recommendations keeping millions of Americans unemployed and underemployed, merchants face a holiday sales season like no other.

On one hand, retailers are retooling to meet the new challenges posed by the prolonged health crisis — most notably, they quickly embraced omnichannel selling to make it more convenient for people to shop online and pick up their packages at the curbside.

But the pandemic presents another unexpected challenge, one that promises to put retail resourcefulness to the test over the next few months: rising rates of retail fraud, especially Return fraud and so-called friendly fraud are not entirely new. At Signifyd, we asked consumers in January whether they’d lied about an e-commerce order not being delivered in order to obtain an improper refund. More than 14% said they had. When we asked a similar question in September, the percentage had increased to 33%. Meanwhile, about 40% of consumers “said they had asked for a refund because of a fraudulent charge when in fact they knew no fraud had been committed.”when it comes to filing claims on e-commerce orders and returning products for refunds.

- Digital Partner -

We’ve never seen this high a percentage of online shoppers admitting to filing phony claims. It’s hard to say precisely why this is happening, but the widespread dislocation of so many of our fellow citizens looms large. Dire straights don’t excuse friendly fraud, but they do call for a tactful approach when confronting potential cases…   Forbes

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