Floor Polish: Gallery of Retail Fraud

Knowing the different forms of return fraud could save you big money.

Return fraud in the United States represents an $11.8 billion annual criminal enterprise, with the perpetrators of these crimes ranging from organized syndicates to everyday people.

The SIRAS Gallery of Retail Fraud has been developed to shed light on these criminal acts by sharing some real-life examples of the many ways criminals take advantage of retailers and manufacturers through the fraudulent return of products.

SIRAS works with retailers, manufacturers and the law to eliminate return fraud through its patented Point of Sale (POS) Electronic Product Registration, live return validation and product-tracking technologies. Here’s one of the company’s marketing campaigns that highlights some of the most prevalent types of return fraud.

1. Apples and Oranges

Three digital media player boxes: One returned with a granite tile, the second with AAA batteries and the third with a deck of playing cards.

These examples represent a national fraud epidemic of “brick-in-box” returns, where similar cases are reported by nearly every retailer from every region of the country. With this return fraud, customers bought digital media players and replaced them in the original box with something of relatively similar size and weight. The thieves carefully repackage the “brick” in the original product carton, shrink-wrap it,and return it to the retailer as “new” for a full refund.

The stolen units are commonly then sold through online auction sites, to pawn shops or even shipped overseas. Sometimes the returns look so convincing, they even end up back on store shelves and are re-sold to unsuspecting customers.

2. Trade-in Program

Thieves often put a film camera inside a digital camera box return. This is an example of an all-too-familiar scenario where individuals, tired of their old item, purchase a new one to replace it. They then “return” the old one in the new item’s box and with the new item’s receipt, getting the new one for free.

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