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Six Percent of Returns Last Year Were Fraudulent

National Retail Federation
National Retail Federation

Six percent of returns last year were fraudulent – and it adds up to a big number: $25.3 billion, according to the National Retail Federation (NRF).

The retail trade organization said 10.6% of merchandise sold in 2020 were returned – that was $428 billion in merchandise returned to retailers.

The top categories of merchandise returned include auto parts (19.4 percent), apparel (12.2 percent), home improvement (11.5 percent) and housewares (11.5 percent).

Ecommerce accounted for 14% of total US retail sales in 2020, and the rate of fraudulent returns for online orders was higher – 7.5%. That’s $7.7 billion of the $102 billion of merchandise purchased online that was returned.

NRF said online returns more than doubled in 2020.

You can find details of the findings on the NRF website.

Ina Steiner on EmailIna Steiner on LinkedinIna Steiner on Twitter
Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.

4 thoughts on “Six Percent of Returns Last Year Were Fraudulent”

  1. Ina, what exactly is a ‘fraudulent return’ (as opposed to an ordinary return)?

    1. Something returned that was different than what was purchased. Returning a new item as used, or broken. Returning a different item. Sending back a bag of rocks (or an empty box). All of those things happen regularly. We sell bike accessories on Amazon, it’s quite common for someone to crash and return the (now unusable) product as new for a refund. We’ve received a number of items where they’ve put a different (cheaper, usually the old item) in the manufacturer box and make it took like it wasn’t removed.
      In short, if something is returned that would make an average honest person think it’s wrong, you can be pretty sure that it’s really fraud.

      1. NRF asked retailers about returns fraud, they appear to have relied on respondents’ definition of what they considered returns fraud. In November, we delved into the topic; Signifyd described some of the same things Gottaride is describing above:

        http://bit.ly/2Ls9x4S

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