Why Should I Care If An Employee Uses Illegal Drugs On Their Own Time?

Because like alcohol abuse, both legal and illegal drug use, affects your bottom line. This issue never has a happy ending and it will never go away unless you meet it head-on.

Drug abuse affects your bottom line through poor performance, high numbers of no call/no shows, risk to customer and employee safety, high workers comp claims, bad elements frequenting your business, customers shying away from your business and much, much more.

If you operate in a State that has essentially de-criminalized marijuana use, you have an even bigger exposure. Employees that feel empowered to get high on a frequent basis and come to work in that condition, are a threat to your livelihood. State law does not relieve you of liability. Marijuana use and possession are still illegal under Federal law. Even if the Federal law was to change, you would still be liable for your employee’s actions while they are at work. It is just the same as an employee that is under the influence of alcohol while at work.

But you probably suspected or knew this already. What you cannot do is look the other way. Your plan should start with hiring, as competently as you can. I teach pre-employment interviewing live, via webinar to LPSI customers free of charge. A candidate will likely tell you if they abuse drugs, you simply need to know how to ask the question. These techniques also apply to employee theft from their previous employers. You just need to know how to ask.

A solid Applicant Management Center (AMC) will allow you to keep track of the application and their information. We have an excellent AMC that is also so inexpensive that it is a no-brainer. No more paper applications to keep up with.

Next, you must conduct a background investigation (okay, we do that too). A search of the candidate’s criminal record, credit (if necessary), education and a drug screen will give you a much better idea of who you are hiring.

Drug testing is simple and inexpensive. Our customers approve the candidate for the drug test and our online system allows the candidate to locate and schedule the test at a lab near them. Our nationwide system then tracks the progress. Results are given to you automatically. We can advise you on what substances you should include in your testing. Tests that come back positive are automatically reviewed by an M.D.

So now that this is out of the way, we need to return to the reason why you should require drug testing. Imagine this: one of your employees in the process of doing their job, is under the influence of a substance, and they injure one of your customers, accidentally. In today’s climate that incident will be known far and wide. None of us want to be on the five o’clock news with the headline “Customer injured at insert your company’s name here by an employee that was high”.

Need more? People who use illegal drugs attract other people who use illegal drugs. The whole birds of a feather, flock together scenario. And in my 40+ years of Loss Prevention and Law Enforcement experience, I can tell you that the financial pressure that illegal drugs puts on a person will make them likely to steal to support their needs. Illegal drugs WILL lead to employee theft regardless of how well you think your employees like you and company.

Fix the issue before it becomes a financial drain and a liability to YOUR business and livelihood. Contact us today for more information.


Preventing Shoplifting In Your Store

A Target or Walmart store can and are able to fight shoplifting in their stores every day of the year.  The expense associated with shoplifting has for many years been known to be passed down to the consumer, and the increase in prices has been an expense that gradually has affected consumers around the globe.

In the United States retail shrink which includes shoplifting, employee theft, administrative errors and vendor fraud cost the US retailers close to $50 billion in 2016 alone. More than 36% of shrink was due to shoplifting, and 30% was due to employee theft.

Many local businesses across the United States have taken different approaches to prevent shoplifting.  From investing in Facial recognition software to shoplifting prevention training, many businesses have taken different approaches to the prevention of this crime.  But, according to the National Retail Federation (NRF) even as the average inventory shrink rate has increased by close to 1.5% the budgets for loss prevention personnel has decreased or remained flat.

What are some of the steps local businesses have taken to prevent shoplifting?

Signage – A Spokane Washington local business has signage that lets you know from the time you enter their store that they have Video surveillance in use and they will prosecute you in case of shoplifting, and they also have a policy of taking your name when you enter their fitting rooms. If you shoplift, they already have your name.

Customer Service -has been proven to be one of the major loss prevention strategies businesses have adopted that can also benefit them in the long run. Be aware of the difference between offering great customer service and stalking a customer.

Training –  Trained personnel cannot only help you prevent shoplifting but can prevent incidents from getting out of hand.  Knowing the laws, regulation, and the process when a shoplifting incident occurs can save lives and prevent lawsuits.

Facial recognition software – If you are using facial recognition software in your stores, caution has to be taken into consideration.  Using facial recognition improperly can lead to too many problems and too few rewards.  Properly trained personnel are one important aspect of using this kind of security measure.

There is probably a fine line between great customer service and making your customer feel like a criminal.  Losing customers because your employees follow them and are constantly asking them if they need help or making them uncomfortable is not a good solution.  If you are also targeting people for no apparent reason, the probability that the bad experience will find an outlet that will carry bad publicity for your business is very likely.

Let us know if some of the above methods you are using seem to be working for you.


Valentine’s Day and Shoplifting

Some of the most stolen items in stores in the United States are not surprising.  From Infant formula to razors, people are stealing these items to sell them for quick cash or because they are shoplifters that are dedicated to doing this crime. Valentine’s Day is approaching, and some of the items that seem to be gifted during this day are among the most commonly stolen items in the United States.  A shoplifter will steal any time of the year, whether the opportunity presents itself or not, or whether it’s a holiday or a weekday.  As a store manager or employee of a store, greeting and treating a customer politely can gain you a customer, and deter a shoplifter from stealing from your store.  Customer service has been proven time and again to be a great deterrent to shoplifters, and cannot hurt to be polite and competent with your regular customers.

Here are the ten most commonly stolen items in the United States:

1. Alcohol – It is not surprising that alcohol is one of the most sought items to steal.

2. Makeup– small items that are accessible on the shelves  and that can be concealed with very little work, makeup is one of the hot items to steal every day of the year, not only during the holidays

3. Fashion accessories -including creams, sunglasses, belts, and scarfs can easily be concealed and carried away between jackets or other loose fitting clothing

4. Mobile Accessories– From chargers to cases and everything you need for your smartphones and Ipads are some of the items many shoplifters can steal and that are easily sold elsewhere for a profit.

5. Beauty and Hygiene items but especially razors are one of the top items shoplifters seem to prefer to steal.

6. Lingerie – February 14th. is just two weeks away, and believe it or not lingerie seems to be very popular to give and receive during this sweet holiday.  If you are a retail store and sell Valentine’s day items, prepare your employees for the shoplifting that may occur.

7. Meat – Red meat is not good for our health, but apparently shoplifters like to steal meat from supermarkets and is one of the most commonly stolen items today

8. Baby Formula– One of the most stolen items today is baby formula. Shoplifting baby formula and then selling for a profit seems to be the way shoplifters prefer to do this and stores across the country seem to be feeling the pinch

9. Chocolate – For Valentine’s Day, chocolate is a favorite for many people.  Keeping a lookout for this item can probably reduce your losses a bit this February and throughout the year.

10. Over the counter drugs– With the price tags of some of these over the counter medications, it is not surprising many people are choosing to steal them instead.


 

Sex, Drugs, Rock & Roll

I actually like and believe in all three of these things. When it comes to drugs they have to be the legal kind. All of us have seen the destruction that illegally used drugs cause. In a business environment, illegal drug use by an employee not only has an impact on their work performance but creates serious customer and legal issues for employers. An employee that is under the influence of any substance that influences their ability to do their job correctly or safely, will cause customers to question who they are doing business with.

If this employee drives for their employer and is involved in an accident, even if it is not their fault, then liability could come back to the company. That one is easy to understand. But what about the recent changes in the law regarding marijuana? Some States have relaxed or legalized its use. However, it is still against Federal Law… EVERYWHERE. I do not agree with these changes. Not because I am a former Law Enforcement Officer that has seen firsthand the impact on society but because it is simply wrong.

The biggest argument I hear is “well alcohol is legal. Marijuana is no different”. Sorry to say yes it is. The active ingredient in marijuana is THC. THC stays in the bloodstream for up to two weeks after it has been ingested. Alcohol leaves the bloodstream within hours of consumption. The person may not be high but the “drug” is still there.

Now that same person comes to work. They have not ingested any marijuana for let’s say a week. Now they are involved in a customer accident. This could be dropping something on a customer from a shelf, hurting a customer with the use of a forklift, pallet jack or motor vehicle, or any other poor judgment that results in injury. If it is discovered as a result of testimony, blood test…. that the employee had THC in their bloodstream….. Surprise, you as the business owner could now be liable.

As a Loss Prevention Manager, I was involved in an accidental death case in one of my stores. Picture a building materials type store. Lumber, hardware, carpet, nuts, bolts…. A forklift operator was moving two full bundles of lumber and had them up on the lift about ten feet off the ground. At that moment a man and his very young son walked underneath the load. One of the forks on the lift gave way and an entire load of lumber landed on them. It killed them both instantly. There was not a piece left of either of those human beings thicker than three inches.

When OSHA, Fire/Rescue, Law Enforcement and a whole bunch of other government folks arrived on the scene, it was quickly determined that there was a defect in the fork that broke. This defect occurred during the manufacturing process. That defect was not caught as it should have been. So liability rested squarely on the forklift manufacturer. However, as required by law, our employee was drug tested immediately. His test came back positive for THC/marijuana. This caused the liability to shift to my company. All because this employee had smoked marijuana the weekend before.

So you may be thinking this can’t happen to me. I own a small boutique, grocery store, clothing store….. Yes, it can and could happen at any time. Why risk it? The commonly accepted practice is an employment drug test. Screen out potential liability and poor performers. A drug test should be required as a part of the pre-employment process, no exceptions. It is a simple and painless process. Contact us today, we can set your drug screening program up, make it very cost effective and make it simple for you and your candidate. You can reach us toll-free at 1-770-426-0547.


Sweethearts In February Are wonderful, Sweethearting Deals Between Employees And Their Friends Are Not

It is the time of year again when Cupid starts shooting his arrows and couples fall in love. What is more romantic than the marriage proposal in a restaurant and a ring presented in a glass of champagne? How about sweethearts strolling along the beach under a moonlit night? Is there anything more touching than the couple that has been married for a very long time and they still walk hand in hand wherever they go? Sometimes love makes us do something dumb to try to impress the apple of our eye. In one instance, a prisoner escaped from jail because he was worried how his wife might react to all the time he had been spending in jail. In another instance, a man robbed three waffle house restaurants and a 4th business in order to pay off his girlfriend’s probation fees (both from mentalfloss.com, “11 Strange Things Done in the Name of Love,” by Jennifer M. Wood, Feb 14, 2014). Perhaps it is the purchase of a ring we can’t afford but we are determined to show our love and commitment to the person we are enamored with. Love is fine and we may even excuse behaviors we might normally consider silly when two people are in love. What is not acceptable is when love and friendship turn into “Sweethearting” deals in a retail business.

 Sweethearting is a theft or fraud activity that transpires between two or more people who know each other. At least one is an employee who provides special deals to his or her friend(s) and sometimes co-workers. The transgressions often start out small. They may involve giving a small discount on a drink or snack. Maybe it is “accidentally on purpose” overlooking an item while scanning merchandise through a register. More often than not what starts off as a little gift or friendly gesture evolves into a big problem. That boyfriend or girlfriend starts coming to the store more frequently and checking out in their friend’s line. What may have started out as the occasional extra candy bar in the bag or a large drink at the snack bar for the price of a small drink quickly turns into outright passing and theft.

If the activity is going to take place at the register, the cashier may send a text message to the friend alerting them that they are on a register and will look for them to come in. There are a variety of ways the two can rip-off the store. The cashier can ring merchandise up and discount it so it appears the transaction is legitimate. The employee can fail to ring up merchandise and bag it which becomes a passing situation. There is also the tendering of money that can result in cash shortage. The friend hands over a cash payment and the cashier gives too much change to the patron. This is a difficult type of theft to see transpire because money does change hands.

Sweethearting also takes place when an employee intentionally looks the other way when her friend is in the store shoplifting.  This does not require the employee to take an active role in the crime. All that is required is for the employee to make a point of turning a blind eye to the theft as it is being perpetrated. There are times when the two parties plan out when the friend will come to the store and steal. This also means the employee is now an active participant and aiding in the commission of the crime which is much more serious on the part of the staff member.

Encourage your team to be friendly and courteous. Go above and beyond in the service you offer to customers. Love your shoppers, just make sure your employees aren’t being sweethearts in the process.


 

Don’t Let The Dark Days Of Winter Catch You Unsecure

With darker daylight hours comes the need for more coffee, the use of lights earlier and a plan to keep crime away from your store or business. Have you considered that one of the following types of crime could affect you?

Burglary – This is where a bad guy, low life scum type, breaks into your property when you and your staff are gone for the day. First and foremost you must have an alarm system. Not just the $99 special either. Invest enough that you have ALL exterior doors contacted. Yes, this also should apply to doors that are not used frequently or at all. Add glass break detectors on all exterior glass that can be easily reached. Enough motion detectors to create a trap effect. In other words so that no one can move around very far without a motion detector seeing them. Bad guys do not like light and sound, so add several sirens and strobe lights with at least one strobe on the front exterior and the back exterior. This will help to draw attention to your property by other citizens and the Police. You should always have an alarm control that uses cellular to communicate instead of phone or internet lines which can be cut or compromised.

Leave select lights on in the store to make it easy for the Police to see movement. The bad guys would prefer it to be dark. Are your doors and windows secure, I mean REALLY secure? Check the locks and make sure they operate correctly and are not simply cheap hardware that will give with a push or kick.

Robbery – This is the nightmare situation where someone presents you with a gun. Not as a present either. I have been involved in many shooting situations and have looked down the barrel of a few from the wrong side. It’s kind of funny how a barrel of a 9mm pistol looks like the opening of a 55 gallon barrel.

The key here is being prepared. Deterrents include well-lit stores and alert employees. Keep the cash drawers drained. Only keep the minimum amount of money in the till, the rest needs to go into a drop safe below the register or to the safe in the office. The lower form of life that commits robberies in many cases will make small purchases even a day or two ahead to see how much money is in the drawer. And yes, they know all about larger, excess bills being kept under the till tray in the drawer.

This is where a CCTV system that is adequately covering your point of sale comes in. The DVR should never be in plain sight at the point of sale; preferably in the office. Cameras should look at the point of sale from several different angles. Invest a couple of hundred dollars in a camera that mounts on the door frame at eye level. This will get a great face shot of anyone leaving.

All cameras should record 24/7 since hard drive space is cheap. You should easily get 30 to 60 days of recording. Another awesome deterrent is a Public View Monitor (PVM). A PVM is a monitor that is placed so that everyone entering the store sees themselves as they come in. It lets everyone know the system is active. A larger monitor in the 27+” range is preferred.

Employee Theft – I do not think employee theft picks up any more than other times of the year but it should get an honorable mention. Make sure you have adequate key and door control. Trash should be inspected by a manager before it goes out. Employees that steal will use the trash to get merchandise out picking it up later or have a friend get it. Employee bags should be inspected when they leave. I can send you a policy draft if needed.

Shoplifting – Shoplifters thrive and seek out concealment. Darkness adds to their psychological comfort. This is another reason for a well-lit store. Replace any burned out bulbs. Walk your store when it is dark outside to help discover any areas such as back corners that will provide aid and comfort to the shoplifting enemy. Make sure your Checkpoint system is operating correctly. If not call us for a service call. Ensure that your staff knows how to approach potential shoplifters with customer service techniques. I teach a live seminar on this for our customers, free of charge, whenever they need it.

Existing customers can call us at 770-426-7593 x103 to schedule a seminar. I also suggest that you pick up a copy of my new book: “Protect Your Store! The shoplifting prevention guide for small to medium retailers”. It is available online at Amazon and Kindle. The book has tools to shut off shoplifters right away.

Of course, these tips are good practice year round. However, take a hard, objective look at your store as it is better to prevent than recover from an incident. If we can help you, please reach out to us since we are only a call or email away.


 

Now that the holidays are over does that mean theft is too?

 Whew! You made it through the holidays and hopefully, you were successful in deterring shoplifters and survived the fraudulent return attempts but does that mean you can rest on your laurels? Unfortunately, the answer is “No”. Criminals do not take a break because you do. As a matter of fact, you could find that this is a prime time for criminal activity to increase. Why would that be? It is during these next few weeks and months that traditionally retail owners and managers begin to tighten up payroll. They release their seasonal employees and reduce the hours budgeted to the various work centers. This leads to several theft concerns:

  • If given too much advance notice that the end of their employment is imminent there are workers that may get angry and justify stealing because of a perceived injustice. This person may think they worked hard enough to earn a permanent spot on the team or assumed they would be retained based on what they thought they were told when hired. Some managers feel a bit guilty for having to let seasonal employees go and feel an obligation to give a significant amount of advance notice so the person can look for new work. The best way to avoid this situation is to give a seasonal employee a date they will work up to and no later than during the interview process. By doing so the employer can give a reminder a week out that the last day is approaching. This gives the worker time to start looking for other employment and does not give too much lead-up time for them to start stealing if they may be so inclined.
  • As sales decline after the holiday season, managers and owners have to make budget decisions on payroll expenditures. It is not reasonable to spend the same amount of money on sales floor coverage with reduced customer counts. Where you had three or four cashiers during the last few months to ensure customers were served quickly you may now have only one cashier. The staff members that were getting 32 hours a week may be down to 25 hours a week. If the employee is dependent on that income to make ends meet and their hours are cut they may decide that stealing is a way to make up for what they have lost. 
  • When seasonal employees are released and hours reduced to cut back on payroll expenses, sales floor coverage starts to wane. This means there are fewer people to provide customer service that is one of the critical components in theft deterrence. Shoplifters know when there are fewer employees present and find it easier to avoid those few workers that are on the floor. Remember that one of the three things needed to shoplift is the opportunity and with less chance at discovery, more opportunities to steal present themselves.
  • There are operational functions that may suffer due to a reduction of payroll hours. Specifically, merchandise protection strategies including electronic article surveillance tagging of merchandise may not be as thorough. As an example, if a freight pusher is responsible for tagging products with retail anti-theft devices but they are struggling just to get freight stocked on the floor in the allotted period tagging could be a secondary issue. The focus may be on filling the floor in order to sell rather than protecting it to prevent theft.

Criminals are not going to take a vacation after the holidays. They will look for stores that lower their defenses and then take advantage of them. Be on guard as you come out of the busy season and things seem to slow down. Be wise in how you reduce seasonal employee staff and do what you can to encourage the people you are keeping. Make plans to identify and address potential problems that may arise from those decisions. Strategic planning and follow-up can minimize the chances thieves will try to target your store.


Retailers’ Biggest Nightmare: Shoplifting

Big corporations across the globe worry about cybersecurity attacks and the repercussions those attacks have on the corporation’s bottom line. These cybersecurity attacks to their servers and information databases can be costly and can bring with them costly lawsuits as well.  But, according to many analysts, employee theft and shoplifting are the more concerning issues affecting the retail industry.  They alone account for more than two-thirds of their shrinkage and that figure seems to be rising every year.  During the holiday season, those issues become more problematic and costly, and the retail industry looks for ways to prevent the great loses they will certainly suffer during this jolly time.

For more about this and other stories, follow the links below.


This crime in the workplace is costing US businesses $50 billion a year

There is a hidden risk facing small businesses across the country that often goes unnoticed until it suddenly rips through a firm’s finances: employee theft. It’s a crime that is costing U.S. businesses $50 billion annually, according to Statistic Brain.

Matt Ham can attest to that. He has had two run-ins with thefts by employees at his small business, Computer Repair Doctor, which has eight stores in Florida, Ohio and South Carolina, which collectively totals 30 employees.

At a store in Florida, two employees were caught stealing parts from inventory and skimming cash about a year and half ago, he said. After a thorough investigation, Ham sat them down with his attorney and they came up with a plan for restitution. Both employees had to pay back the thousands of dollars they stole. The chain has now put more safeguards in place, such as better inventory controls and a strict cash-counting process.


Survey finds no let up in one of retailers’ biggest threats

Nearly all retailers fell victim to organized retail crime during the past year. And the losses are mounting.

 Ninety-six percent of responding retailers experienced ORC in the past year, according to the 13th annual ORC study by the National Retail Federation. And 67% reported an increase in this type of activity during the past year.

The survey of retail loss prevention employees found that losses averaged $726,351 per $1 billion in sales, up from $700,259 last year. Los Angeles continued to be the hardest-hit area for ORC in the nation, a position it has held since 2012. Following in order were New York City, Houston, Miami, Atlanta, Chicago, Orlando, San Francisco/Oakland, Orange County, Calif., and Northern New Jersey.

“Organized retail crime continues to be one of the biggest challenges to retailers of all sizes,” NRF VP for loss prevention Bob Moraca said. “These crimes happen across the country every day, with criminals getting smarter, more brazen, more aggressive and sometimes even attacking store employees and shoppers. Fighting ORC is a full-time job, and retailers must learn how to stay a step ahead of these thieves.”


Loss Prevention Trends to Watch During the Holiday Shopping Season

All retail eyes are focused on online security and digital transactions during the holiday season. But according to the National Retail Federation (NRF), shoplifting and employee theft accounted for more than two-thirds of inventory shrinkage in 2016. Retailers need to improve their internal security systems to boost their loss prevention abilities and keep their shrink rate from rising above last year’s historical high of 1.44 percent.

Retail store shrinkage is a known part of the industry, but with all the attention centered around cybertheft of customer information and implementing proper security measures at point-of-sale (POS) systems, the age-old problem of losing products at the physical store has taken a back seat.

Leveraging Cybersecurity Technology for Loss Prevention

Technology is playing a larger role across all retail efforts, and some of the tactics employed in the back office to protect the company’s digital data can be expanded to store-level prevention. The specifics of the skills needed differ between cybersleuths and on-the-floor store personnel, but more education and discussion between these disciplines can help.


 

Bad Santa (this one is on the naughty list)

Could it be that Santa Claus is not always a jolly, giving man? Oh yeah. Take a look at this Santa. He (or I guess it could be a she) is out for a little cheer for…. himself. Regardless who they are, customers need to be watched. In this case, the store let their guard down because of the costume. Shoplifters use deception and costumes to steal.

In this case, the Santa costume allows plenty of room to hide merchandise. Shoplifters will make or modify clothing to become a shoplifting tool. We call these “booster” items. Booster coats, dresses, skirts, pants and more. I have even seen booster “bloomers”. They are worn under a loose fitting skirt or dress. The shoplifter drops a merchandise item through what looks like a pocket in the outer garment and into the bloomers which are secured at the knee. A lot of merchandise can be concealed that way. We once caught a woman with four cordless drills including batteries concealed that way.

Other costumes include religious clothing. How about a Nun? I have caught one of those. It was a difficult “habit” for her to break. Even someone who dresses as a member of the Armed Forces, a security officer, repairman, phone company technician with tools and a toolbox. A shoplifting team may use a person like this to distract your attention or create a scene while the others steal.

Another booster item could be a false bottom gift-wrapped box. Your merchandise Items go in the bottom with a trap door. Shopping bags are yet another tool. Especially ones from your store. Our inclination is that whatever is in there, was already purchased. Or they put stolen merchandise under merchandise that they did purchase.

The general rule of thumb is that shoplifters want to blend in with your regular customer look. Take a look at this video of a customer that “blended in” but was bottomless:

If your average customer wears a suit then that is the way the shoplifter will dress. If they wear shorts and flip-flops, then that is their targeted look. But a costume that portrays confidence such as uniforms, religion, public servant… is like hiding in plain sight. We dismiss that person “because an XXX would not be stealing from me”.

If a costume makes people uncomfortable, they would tend to avoid that person. Someone dressed in an outrageous way such as a stripper (okay, not too many places to hide something), odd clothing combinations and colors or some of what we can find at the People of Walmart website probably qualify.

Of course, no story on shoplifting costumes would be complete without a creepy clown. So if I have not weirded you out too much, then happy hunting!


Proper Preparation For Holiday Gift Returns Reduces Fraud

The end of the holiday gift buying season ushers in the inevitable holiday gift return season. Clothes that don’t fit, ugly holiday sweaters no one really wanted, toys that were too old for a young child or too young for the older child all lead to returns, exchanges, and refunds. For those who have been in retail for any length of time, we know that many of these items will be returned without tags or a receipt and not even a gift receipt. It also means people will try to return merchandise to your store that was never even purchased there, despite what the customer in front of you says. This means it is prime time for those who engage in return fraud. There are so many people making returns that trying to separate legitimate refunds and exchanges from the fraudulent ones is difficult. There are steps you can take to minimize the number of fraudulent returns you accept.

  • Ensure you have your store return policy clearly posted at the points of sale all year round but make it especially prominent during November and December.
  • Encourage cashiers to remind customers of the store return policy at the time of purchase. If there is a time limit to how long a customer has to refund an item that should be stated.
  • While some stores have gone to print as well as emailed receipts if your store has instituted this recommend that patrons use BOTH options. This means that even if a receipt is lost it should still be in their email.
  • Open packages to see what is inside even when shrink-wrapped. The really good criminals will know how to seal a rock inside a box to make it look normal.
  • Require a government-issued I.D. card with no-receipt refunds. It may sound extreme but those persons who engage in fraud are less likely to do so if they have to produce a picture ID.
  • For no-receipt refunds require an exchange for a like item. Criminals have gotten to the point where they are willing to accept in-store credits what they don’t want is the merchandise. Exchanging for a like item defeats their purpose.
  • Be ready for the returns. If possible have one return line for receipted returns get customers through more quickly. Have a second line for no receipt refunds/exchanges that may take more time to process. You will make life easier for the customers with receipts and you give cashiers the opportunity to be more thorough with no receipt returns without feeling pressured to hurry through the transactions.
  • Don’t leave a regular employee alone with a line of customers, have a manager at the return desk or register too. Most customers will be understanding of wait times and return policies but some won’t be and hourly employees shouldn’t have to put up with the added stress caused by upset “no-receipt” returners. Fraudulent returners also look for employees who appear to be young or relatively new. Having a manager up front can discourage some of these people.

Being aware in advance that fraudulent returns will be attempted helps prepare managers for the situations when they arise.

It should also be pointed out that gifts are not the only items that will be returned fraudulently after the holidays. A lesser-known practice called wardrobing will also be conducted by dishonest customers. Store owners should be aware that these will be the Christmas or New Year’s Eve partygoers that don’t want to rent an outfit or buy it outright. The problem with this group is they are returning their merchandise with the tags intact and with a proper receipt. Unless they are returning the items outside of a specified policy it can be very hard to put a stop to this activity. An example might be if a store has a 30-day return policy and a customer attempts a return on day 31. This would be a clear reason to turn down the refund. The only sure way to prevent this fraud is for a store to use devices known as wardrobing tags on clothes to keep it from occurring. Loss Prevention Systems Inc. can provide more information on this type of fraud for store owners or managers interested in deterring the activity.

Not all no-receipt refunds during the holidays are fraudulent but a significant number are and it hurts a store’s profit margin. Make preparations now and put control measures in place that will make it hard for criminals attempting to cheat your business.