More Amazon shoppers are scamming sellers with fraudulent returns

Amazon makes it so easy for consumers to return products that some shoppers are taking advantage of the policy and scamming sellers. 

Nicole Barton, a small business owner who used to sell clothing and accessories on Amazon described a customer returning a pair of flip-flops on an order for Nike cleats. Another shopper swapped a Coach wallet for an imitation accessory, according to a recent Wall Street Journal report. 

“Amazon sellers get all kinds of junk returned back to them,” Wall Street Journal reporter Sebastian Herrera, the author of the report, told CBS News. 

He said another business owner that sells households items received cable boxes and dirty soap bars back from buyers making phony returns. “It’s really anything you can imagine. People ship all kinds of junk back and they do it every day.”

Sellers who get bogus returns lack much in the way of recourse. They can file what’s called a return theft claim, but that doesn’t guarantee they’ll be made whole.  

For its part, Amazon said it has “no tolerance for fraudulent returns,” a company spokesperson told the Wall Street Journal. 

The problem is a “major issue for our industry,” according to the National Retail Federation, which reports that almost 14% of returns in 2023 amounted to fraud. Such returns led to $101 billion in losses for retailers, according to the federation.

“Sellers don’t have a lot of ways to combat this,” Herrera said, noting that Amazon’s policies tend to favor buyers. “A big part of this issue is Amazon has really set up its system to please customers, and a lot of that has to do with easy returns,” he said.

Sometimes, when Amazon decides the cost of processing a return is too high, the retail giant even gives customers refunds on low-cost items they don’t want while still allowing them to keep the products. 

It’s but one challenge merchants on the platform face, and a reason why the Federal Trade Commission is suing the online retailer.

“A lot of sellers are not happy with Amazon because they feel squeezed by the company and not very supported,” Herrera told CBS News. “And return theft is just one example that they list [as] an area where they don’t have a lot of power over Amazon.”