Hello, I have an ecommerce store and the products that I sell have a low return rate. I typically receive approx 5 returns per year, but in the last few months I’ve received 8 returns on one product, then after I labeled it out of stock, I received another 10 returns on another, very different product.
The customers are from all over the U.S., but the scenario is nearly identical on every order.
Both of these products are under $25 dollars and all of the customers send nearly the exact same message: “I have just received the product and decided I no longer need it. It is still in the box, unused. Please send me return information”
This is clearly some type of scam, but I can’t understand what the scam is?
The products are an electrical power cable and a water spigot. I wouldn’t think these are likely counterfits and we inspect them upon return. The all appear unused.
I created a 15% restocking fee, but this hasn’t seemed to make a difference.
They pay shipping on the purchase + they pay for the return shipping & the restocking fee. All totaled, these end up costing the customer nearly as much as the returned product, so I can’t understand what they’re getting out of this?
Does anyone have any insight on what this scam is? Any suggestions how I can stop it?
The only solution I can come up with is to significantly raise my restocking fees on these low cost items, but I fear this may discourage “legitimate” customers from purchasing.
I totally understand this is a frustrating situation for you and it seems you are right, this does look like a scam.
Possible Scam Explanation:
Reselling for Profit:
Scammers might be purchasing your products to resell them elsewhere at a higher price. They return the items to you to get their money back, essentially using your store as a free inventory source if the product is not sold and the return date is near.
Credit Card Fraud:
Another possibility is that scammers are using stolen credit cards to make purchases. They return the items to get a refund to a different account, effectively laundering the stolen money. This may happen if they have sub accounts linked to the main account. You might be returning the money to the original source while they would be getting it in the sub account.
Fake Returns:
Some scammers might be returning counterfeit or similar but cheaper products, keeping the original items for themselves. I am sure, you are already validating this thoroughly when the return comes.
Competitor Sabotage
There maybe a case where one of your competitor is trying to discourage or show your store in bad light by allocating a set fund for all these activities. I may be wrong here, just thinking through ;( There may be a payment processor linked to your store, and every return/refund lowers your reputation with the payment processor upto an extent and eventually they may object and think twice before they continue offering their services as they do monitor return % for their clients as a parameter.
Steps to Mitigate the Issue1. Increase Verification:
Implement stricter verification processes for returns. For example, require proof of purchase and detailed reasons for returns.
Analyze Patterns:
Look for patterns in the return requests, such as similar email addresses, shipping addresses, or IP addresses. This can help identify fraudulent activities.
Adjust Return Policies:
Consider tightening your return policies for low-cost items. You could increase the restocking fee or limit returns to a shorter time frame.
Use Fraud Detection Tools:
Shopify offers various apps and tools that can help detect and prevent fraudulent activities. Apps like Fraud Filter can help you set up custom filters to flag suspicious orders.
Contact Shopify Support:
Reach out to Shopify Support for assistance. They can provide additional resources and tools to help you manage and prevent fraud.
The “near-identical message” signal is the giveaway — that’s almost always a coordinated group or a single actor recycling a script. Two patterns I’d check:
Device fingerprint / IP overlap — different names and addresses but same browser fingerprint or IP subnet means one actor. Shopify doesn’t show this natively, but you can approximate it by checking the order timing (orders placed within seconds of each other, same user agent).
“Empty box” returns on low-value items — the scam is often to return an empty box or a cheap substitute. USPS/UPS won’t weigh returns for you. If your product is small, take a before-ship photo with weight — it’s your only leverage if you ever need to dispute.
On whether to refund: if the items are under $25 and the volume is high, most merchants take the L on the first wave rather than fight it, then silently tag those shipping addresses and require pre-authorized returns going forward.
The identical message is the dead giveaway. Real customers don’t word return requests the same way.
For items under $25 where they’re paying shipping both ways plus restocking, the math only works in two scenarios.
Credit card testing. Someone runs stolen card numbers through small purchases to verify they work before using them for bigger orders elsewhere. The returns are just cleanup so chargebacks don’t pile up on your account too quickly.
Or triangulation fraud. A scammer lists your product on eBay or Amazon, buys from you with a stolen card, ships to their buyer. When the real cardholder notices, your “customer” returns the item. Either way you lose.
Practical fix for sub-$25 items: stop accepting physical returns on them. Just refund and tell them to keep it. Sounds counterintuitive, but processing a return costs you $5-8 in labor and materials alone. And if it IS stolen cards, the chargeback is coming anyway.
For prevention, Shopify Flow can auto-tag customers with more than 2 returns in 90 days. Flag those accounts for manual review on future orders. Also check if the return requests cluster around certain days or times. That pattern tells you whether it’s one person running multiple accounts.
Are the shipping addresses all different, or do you see any overlap there?
The shipping addresses are all different. The solution that has worked for me is implementing a 20% restocking fee on all orders. I hate doing this for legitimate customers, but it seems to have put a stop to this scam in my store.