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Local 12: ‘Friendly fraud’ hurting honest consumers

Lindner professor weighs in on retailers’ reaction to customers’ mischief

headshot of Grant Freking By Grant Freking
1 minute read January 31, 2024

Unfortunately, not all consumers possess the best intentions when returning products. And according to a University of Cincinnati information systems professor, the outcome of “friendly fraud” winds up harming sincere shoppers.

A Local 12 report described friendly fraud as consumers “returning damaged or counterfeit goods for money or store credit” or falsely reporting safely delivered packages as lost or damaged.

Andrew_Harrison

Andrew Harrison, PhD, associate professor of information systems.

Retailers have responded with both heightened scrutiny and higher prices to combat their customers’ reported transgressions.

“The prices of dishonest consumers’ fraudulent actions are eaten up by honest consumers,” Andrew Harrison, PhD, associate professor of information systems in the Carl H. Lindner College of Business, told Local 12. “Returning will actually become harder for honest customers, as well, as companies try to put in more safeguards to insulate themselves from the losses associated with this.”

See more from Local 12.

Featured image courtesy of Adobe Stock.

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