Merchandise returns in 2013 cost U.S. retailers more than $267 billion in lost sales, and retail fraud and abuse accounted for $9.1 billion to $16.3 billion in the United States, an increase of 2.6 percent from 2012, according to The Retail Equation’s 2013 Consumer Returns in the Retail Industry report.
Identity theft is already a serious problem—the No. 1 complaint to the Federal Trade Commission, and tax-related identity theft is a growing part of this crime spree.
Retailer Neiman Marcus said that thieves stole some of its customers' payment card information and made unauthorized charges over the holiday season.
Ginger Reeder, spokeswoman for Dallas-based Neiman Marcus Group Ltd., said in an email that the retailer had been notified in mid-December by its credit card processor about potentially unauthorized payment activity following customer purchases at stores, said AP. On Jan. 1, a forensics firm confirmed evidence that the upscale retailer was a victim of a criminal cyber-security intrusion and that some customers' credit and debit cards were possibly compromised as a result, said AP.
Reeder wouldn't estimate how many customers may be affected but said the merchant is notifying customers whose cards it now knows were used fraudulently. Neiman Marcus, which operates more than 40 upscale stores and clearance stores, is working with the Secret Service on the breach, said AP.
"We have begun to contain the intrusion and have taken significant steps to further enhance information security," Reeder wrote.
A California escrow firm that was forced out of business last year after a $1.5 million cyberheist is now suing its former bank to recoup the lost funds.
The identity theft rate for children is 51 times higher than the rate for adults, according to new research. These long-term frauds can be devastating to a child's future, as a preexisting bad credit score can make it difficult to secure student loans, housing or a job.
Companies and their Boards are struggling with increased regulatory burden and the risks associated with operating in emerging markets. Regulators are challenging corporate compliance and governance models as companies aim to mitigate risk while shareholders expect growth. The changing landscape for cross-border disputes, bribery and corruption and cyber-crime continues to test compliance and governance models, especially in new markets.
The retail industry will lose an estimated $8.76 billion to return fraud this year, and $3.39 billion during the holiday season alone. Overall, 5.8 percent of holiday returns are fraudulent, up slightly from 4.6 percent last night.
Nearly half of financial frauds being uncovered involve criminals trying to use someone else’s stolen personal details, Experian warns. The credit checking company says that identity theft is a “significant and rising threat,” accounting for 46 percent of financial frauds detected this year – that’s almost double the rate of cases seen in 2012 (27 percent).
Shrink, comprised of shoplifting, employee or supplier fraud, organized retail crime and administrative errors, cost the retail industry more than $112 billion globally last year, according to the 2012-2013 Global Retail Theft Barometer, and represented 1.4 percent of retail sales, on average.
