'Return fraud' costing retailers big bucks

SEATTLE -- Wednesday is historically one of the busiest shopping days of the year, but it's also the start of the holiday season for crooks illegally returning items to stores.

The wide-ranging scam costs businesses nearly $9 billion, and almost half of the money lost to "return fraud" comes during the holidays, according to a survey from the National Retail Federation.

The survey estimates that one in every 21 holiday returns is a rip off.

Oftentimes the scam involves someone wearing clothing or watching a television and then returning the items. Return fraud costs businesses billions each year, and that loss gets passed on to customers in the form of higher prices and stiffer return polices.

In an effort to combat the scam, some retailers are now keeping track of how many items a customer returns. For someone like Bob Perkins, it's not a problem.

"I know that sometimes if you buy using a credit card, sometimes they'll let us go without the receipt. But we got the receipts that we needed," Perkins said.

But bad guys use common tricks such as buying merchandise with fake checks and then returning it for cash or exchange. There's also "wardrobing," which involves wearing a dress and then bringing it back. Counterfeit receipts are also big part of the scam.

Online shopping is also hurting the industry because emailed receipts are easier to fake. Despite the high risk, 90 percent of the stores surveyed allow items purchased online to be returned at a brick-and-mortar store.

The National Retail Federation says most stores are keeping their return policies intact, but more retailers are loosening their policies than tightening them. Competition demands it, despite the rip offs.

Northgate Mall Hallmark worker Gina Henderson said employees are trained to watch out for return scams, but she doesn't think it's a big problem.

"You always gotta be on your toes," she said.

To avoid problems when returning items, customers should follow a few easy tips. First, electronics must be returned sooner than other items -- often within 30 days. You also have a better chance of getting a full refund if the box is unopened.

Many stores track purchases electronically and no longer need a receipt. When you can, you should also keep tags on the items you're returning, especially clothes.