Stores tighten return policies to combat fraud

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Behind the retail sales counter, Carole Penberthy has heard every kind of excuse from customers trying to return items."I spilled wine all over this shirt," a man told her after having dinner at a nearby restaurant.He had bought the shirt from her two months earlier."Give me a new one," he insisted. "This one is ruined."Another customer walked in with about 12 pairs of men's shorts, part of her husband's old wardrobe."Her excuse," Penberthy said, "was my husband's lost a lot of weight. Will you give me new ones?"Penberthy, who works as a floor manager for Tommy Bahama at The Lakes in Thousand Oaks, Calif., wonders if customers think that retail workers are dumb."We're all intelligent," she said. "I have a college degree. I choose to work retail.""Return fraud," as this behavior is known, includes returning stolen merchandise, merchandise bought with fake or stolen credit cards, and items backed up with fake receipts.Nearly 9 percent of holiday returns this year are expected to be fraudulent, costing retailers an estimated $3.7 billion, according to the National Retail Federation.Much of what Penberthy sees is people asking for cash refunds on merchandise purchased for less from a discounter or online."Wardrobing" -- wearing purchased clothing once and returning it -- is another big problem. That's what Steve Phillips, manager of J.C. Penney in Ventura, gave as an example of what he's seen people try to do.He said J.C. Penney changed its return policy in October. "A receipt is needed with a (purchase) date within the last 90 days," he said.Phillips said the change was made "to be consistent with other retailers.""And, of course, when you tighten a rule like that you reduce problems, which reduces expenses, which enables us to keep our merchandise reasonably priced for our customers."It's the honest customer with a legitimate gripe who pays for return fraud as stores institute stricter rules for returning purchases."Stores have to tighten up their policy because there are so many frauds and so many bad returns," Penberthy said.Target Corp. changed its return policy over the summer, spokesman Joshua Thomas said."Yes," he said, "we have taken some steps with regard to our return policy to combat fraudulent returns."The stores now won't allow you to return a product without a receipt unless it is $20 or less. It previously was $100 or less, Thomas said.It probably hasn't been noticed by most shoppers, Thomas said, because more than 90 percent of customers use a receipt or the stores can look up a receipt for people who paid with anything other than cash."The impact on our guests in terms of the non-receipted returns is minimal," he said.Still, there are some retailers who are going in the other direction, according to the National Retail Federation , which found that 35 percent are making their return policies more lenient for holiday shoppers."Retailers must constantly balance the desire to take care of their customers with the undisputed fact that criminals are constantly looking to take advantage of return policies," said Joseph LaRocca, the federation's vice president of loss prevention.Returns will be ubiquitous during what Penberthy calls the "bad season," Dec. 26 to Feb. 1.Her advice for shoppers during that time is to keep receipts."When people come in for a legitimate return, I'm happy to help," she said.(Contact Stephanie Hoops of the Ventura County Star in California at www.venturacountystar.com.)