Is someone stealing your refunds?

When we hear of fraud we mostly think of counterfeit cash, or scam calls. We tend to forget about return fraud, and that is because we don’t necessarily notice it. Let me tell you, I have worked a lot in customer service and have witnessed my fair share.

Return fraud?

Retail establishments are one of the three business establishments that suffer from this kind of fraud (alongside banking and health & property insurance) (Canada, 2008). A customer may want to return a stolen pair of jeans, or might say they never purchased from your online store but their credit card was charged. If you fall victim to return fraud, you may have to face chargeback’s. The key to minimizing return fraud is to be aware of all transactions made face-to-face and online:

  • If an authorization is declined for the full amount, request another form of payment.
  • When processing a refund, process it on the same form of payment it was previously purchased on.
  • For any credit or debit return, compare the signatures on the back of the card and on the receipt.
  • Make sure your return policy is visible to customers at the cash, and is pre-printed on your receipts.
  • Accept store exchanges or make store credit part of your policy.
  • For online purchases made to your shop, ensure the address is accurate.

Who can help me?

You can submit a fraud report to your local police or to the Canadian Anti-Fraud Centre. For chargeback’s you can contact the FCAC for guidance. However CFIB does provide help to its members who need assistance.

Train your staff

Make your staff aware of the following:

  • Organizing your receipts (weekly).
  • Train your staff on inventory; make sure it is done daily.
  • Comparing signatures when processing a payment or a return.
  • Accept only signed cards.


Cassandra Beaugé joined CFIB’s Ottawa team as the National Affairs Assistant in 2016. Behind every small business hides a human who may need help but doesn’t know where to begin. That’s why Cassandra enjoys giving a hand in Business Resource. She enjoys reading and is a fan of the WWE!

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