Online fraud communities have been created for people to share tips on making fraudulent returns of bought items.
A new study also reveals the widespread practice of wardrobing, where people buy an item of clothing, wear it once and then return it.
Griffith University criminologists Michael Townsley and Andrew Childs, and Joseph Clare from The University of Western Australia, reviewed returns habits through a customer survey and a scan of online fraud communities.
They found practices ranged between outright deception, such as using fake receipts or returning stolen goods, and “grey-area conduct” such as wardrobing.
Professor Townsley said wardrobing was an example of returns abuse because many customers did not see it as serious misconduct.
“Wardrobing is when someone buys an item, uses it once, and then returns it for a full refund,” he said.
“Customers often justify this by telling themselves the retailer can simply resell the item, or that it was only a one-off, but retailers carry the cost of processing, inspecting, discounting or writing off those returns.”
Professor Townsley said treating all returns misconduct as the same problem made it harder for retailers to respond effectively.
“Fraud involves deliberate deception whereas abuse is more often opportunistic behaviour where customers bend the rules and rationalise it as harmless,” he said.
“That distinction matters because the response needs to be different.”
Dr Childs said the existence of online sharing could make returns fraud easier to learn and repeat.
“We found online communities where people exchange detailed instructions for fraudulent returns, including what to say to retailers and how to avoid detection,” he said.
“Some of these spaces also operate like informal mentorship markets, where less experienced offenders pay for advice from people who have already worked out which methods are most likely to succeed.”
The report recommended that retailers add more “friction” to the returns process, employ stronger governance of returns policy, join-up data from purchase through to refund and provide better support for frontline staff.
“Retailers do not need to make returns harder for every honest customer,” Professor Townsley said.
“The better approach is to know which problem they are dealing with. Fraud is mainly a verification and data problem: can the retailer link the customer, product, payment and return claim with enough confidence to spot deception?
“Abuse is different. It is often about ambiguous rules and customer rationalisations, so staff training, clearer policies and simple customer education can make a real difference.”
