Wardrobing-5 WC Blog 441
Return Fraud-3
Do Gift Cards Remove The Incentive To Commit Return Fraud? Part 1
As a Retail Loss Prevention Manager I remember getting frustrated at the growing trend I was seeing over the years of people returning merchandise without receipts and we stopped issuing cash back or credit card credit and started giving refunds back in the form of a store credit or gift card. I wanted to see more even exchanges for no-receipt refunds. The concept behind the gift cad issuance as I understood it was, if we give a gift card we are keeping the money in the store so we really don’t lose anything. On the surface it sounds right. The person committing the fraud can only use the store gift card in our stores so I guess it really does stay in the store. Then I started finding that those committing return fraud were turning right around and attempting to sell the gift cards to customer in the parking lot or in the store. We would chase them off letting them know we had a no-solicitation policy. That worked for a bit and then we found out through an apprehended shoplifter that he was returning stolen merchandise, getting gift cards as a refund and then taking the gift cards to local pawn shops and selling them. Added to the mess of fraudulent returns were those who engaged in wardrobing. Their returns were more complicated because while fraudulent they didn’t meet the criteria of fraud for any type of prosecution.
What is wardrobing you may ask? It is a type of return fraud when the person intentionally buys an item to wear once or twice and then return for a full refund. The customer makes the purchase, keeps the tags on the clothing by hiding them and of course keeps the receipt. They may also carefully remove tags and replace them when they are ready to take the garments back to the store. The merchandise is worn to dinner, an event or party and it appears the person has a new addition to their clothing repertoire. Rather than keep the clothes and continue to wear them in the future they go back to the store for a full refund. Making matters worse for the retailer is that many times the clothing being returned by a wardrobing customer is that the merchandise has odors from perfume, cologne, food or cigarettes or there may be make-up stains or food stains.
As gift cards have become a more popular form of credit for retailers to avoid the “incentive” of giving cash back for fraudulent transactions the need for selling the cards on the street or in pawn shops has been eliminated. There are now online web sites that will purchase gift cards from people. One web site claims a gift card seller can get up to 92% of the value of a gift card. As I perused the site I found I could buy a $100 CVS gift card for $90 and another website offered a $25 American Outfitters gift card for $19. I found that the website tells a seller that a credit card has to be on file so they will charge it if it is found a gift card was obtained through fraudulent or illegal means. What was not clear to me is how they make this determination? While there are some gift cards I was able to put a stop on because I could prove they were obtained through fraudulent means, such as the use of a stolen credit card or stolen checks, those situations were the exception. I don’t know how or if the site can determine gift cards were obtained through return fraud.
By the way, if someone is committing wardrobing fraud in most cases they don’t worry about getting the gift card. They are receiving cash back because they have all of the proper tags and receipts. There may be a few situations where they receive the gift card because of excessive wear and tear on the garment but often they raise their voices and create a scene to get their way. In part 2 of this article I will discuss how retailers can deal with wardrobing versus other types of fraud.
Get more information on return fraud contact us or call 1.770.426.0547 today.
As a Retail Loss Prevention Manager I remember getting frustrated at the growing trend I was seeing over the years of people returning merchandise without receipts and we stopped issuing cash back or credit card credit and started giving refunds back in the form of a store credit or gift card. I wanted to see more even exchanges for no-receipt refunds. The concept behind the gift card issuance as I understood it was, if we give a gift card we are keeping the money in the store so we really don’t lose anything. On the surface it sounds right. The person committing the fraud can only use the store gift card in our stores so I guess it really does stay in the store. Then I started finding that those committing return fraud were turning right around and attempting to sell the gift cards to customer in the parking lot or in the store. We would chase them off letting them know we had a no-solicitation policy. That worked for a bit and then we found out through an apprehended shoplifter that he was returning stolen merchandise, getting gift cards as a refund and then taking the gift cards to local pawn shops and selling them. Added to the mess of fraudulent returns were those who engaged in wardrobing. Their returns were more complicated because while fraudulent they didn’t meet the criteria of fraud for any type of prosecution.
What is wardrobing you may ask? It is a type of return fraud when the person intentionally buys an item to wear once or twice and then return for a full refund. The customer makes the purchase, keeps the tags on the clothing by hiding them and of course keeps the receipt. They may also carefully remove tags and replace them when they are ready to take the garments back to the store. The merchandise is worn to dinner, an event or party and it appears the person has a new addition to their clothing repertoire. Rather than keep the clothes and continue to wear them in the future they go back to the store for a full refund. Making matters worse for the retailer is that many times the clothing being returned by a wardrobing customer is that the merchandise has odors from perfume, cologne, food or cigarettes or there may be make-up stains or food stains.
As gift cards have become a more popular form of credit for retailers to avoid the “incentive” of giving cash back for fraudulent transactions the need for selling the cards on the street or in pawn shops has been eliminated. There are now online web sites that will purchase gift cards from people. One web site claims a gift card seller can get up to 92% of the value of a gift card. As I perused the site I found I could buy a $100 CVS gift card for $90 and another website offered a $25 American Outfitters gift card for $19. I found that the website tells a seller that a credit card has to be on file so they will charge it if it is found a gift card was obtained through fraudulent or illegal means. What was not clear to me is how they make this determination? While there are some gift cards I was able to put a stop on because I could prove they were obtained through fraudulent means, such as the use of a stolen credit card or stolen checks, those situations were the exception. I don’t know how or if the site can determine gift cards were obtained through return fraud.
By the way, if someone is committing wardrobing fraud in most cases they don’t worry about getting the gift card. They are receiving cash back because they have all of the proper tags and receipts. There may be a few situations where they receive the gift card because of excessive wear and tear on the garment but often they raise their voices and create a scene to get their way. In part 2 of this article I will discuss how retailers can deal with wardrobing versus other types of fraud.
Get more information on return fraud contact us or call 1.770.426.0547 today.
Pre-employment Screening- 4 WC Blog 429
Background Check Company-4
Pre-employment Screening Or Hiring Assessments; Is One A Better Tool Than The Other For Staffing Your Business? Part 2
In Part 1 of this article I spent some time discussing how hiring assessments can be detrimental to an employer in terms of the limiting effect it can have on a hiring pool. These assessments are often a hundred questions or more and can take an hour or so of a job applicant’s time. I related in part 1 my personal experience of taking an assessment for a department manager position and failing it despite my extensive management and retail background. It was also irritating to fail this assessment since I know many of the questions involved integrity issues and handling difficult situations or theft related incidents. Cover your ears, I’m about to shout…I WAS A RETAIL LOSS PREVENTION MANAGER FOR 13 YEARS AND HAD 17 YEARS OR MORE OF TOTAL LOSS PREVENTION EXPERIENCE, FOR CRYING OUT LOUD! Shouting over, you can uncover your ears. You don’t handle many more integrity or theft situations than I have over my lifetime. To top it off, I figured out what the test was wanting, tested for a sales associate job for the same company and scored a 100% on the same day. The questions were generally the same so it was a flawed system, in my humble opinion. Using a background check company is a better way to assess whether an applicant would be a good member of your team than using one of these assessments.
A background check company conducts pre-employment screening for employers and looks at the background and history of someone applying to a business. These checks can be customized to the needs of a particular company so that pertinent information on a candidate can be more carefully scrutinized. A long-haul truck company may be more interested in an applicant’s driver history and training schools attended than his/her credit history. A school will be more concerned with a thorough check of sex offender registries than they will be of a driver history. All employers may want to know that their employees have proper I9 credentials to ensure their workers are working legally in the United States. Based on the position search criteria may be even more stringent. The depth and intensity of the checks can be determined by the background check company and the business. The important thing to know is that you can learn a lot more about who an applicant is through pre-employment screening than through a test/assessment that may not give a true picture of the person you are considering for the job.
Aside from my own experience I also want to share the story of another person who has been affected by one of these assessments. I met a homeless man and had a conversation with him. During the course of our conversation, I asked whether he had applied to a store nearby where I knew they were hiring and have a need for hard working, freight team members. The gentleman said he had applied and even had an interview but had failed the company’s assessment so they couldn’t hire him. I was furious. Not only was this man not out panhandling or asking for handouts, he was trying to apply for work and was turned down because of one of these STUPID assessments. And while he may have been telling me a story I don’t believe he was because I have failed one and I have a college degree and over 34 years of work experience.
I do not know this guy any more than I know the men who traveled to the moon. What I do know is had the business he applied to relied on a background check company to run a pre-employment screening in lieu of an assessment, he may have had a chance to pass and get a job. It is possible this business lost an opportunity to hire one fantastic worker. I know there are those who will be naysayers and insist that hiring assessments are unbiased and give the best evaluation of a candidate’s personality. Hold that thought. According to an article on the website “workable” titled, “Pre-employment Testing: pros and cons” by Nikolleta Bika, October 11, 2016, she lists the positives of pre-employment testing but she also lists the negatives of testing including: testing can be discriminatory, they invite lies and tests assume unique people are made through molds. https://resources.workable.com/tutorial/pre-employment-testing What I am trying to point out is testing is not necessarily going to give you the best candidates and you may cheat yourself out of a great employee. Use pre-employment screening and your interview process to get the best candidates for your team.
Get more information on pre-employment screening, contact us or call 1.770.426.0547 today.
In Part 1 of this article I spent some time discussing how hiring assessments can be detrimental to an employer in terms of the limiting effect it can have on a hiring pool. These assessments are often a hundred questions or more and can take an hour or so of a job applicant’s time. I related in part 1 my personal experience of taking an assessment for a department manager position and failing it despite my extensive management and retail background. It was also irritating to fail this assessment since I know many of the questions involved integrity issues and handling difficult situations or theft related incidents. Cover your ears, I’m about to shout…I WAS A RETAIL LOSS PREVENTION MANAGER FOR 13 YEARS AND HAD 17 YEARS OR MORE OF TOTAL LOSS PREVENTION EXPERIENCE, FOR CRYING OUT LOUD! Shouting over, you can uncover your ears. You don’t handle many more integrity or theft situations than I have over my lifetime. To top it off, I figured out what the test was wanting, tested for a sales associate job for the same company and scored a 100% on the same day. The questions were generally the same so it was a flawed system, in my humble opinion. Using a background check company is a better way to assess whether an applicant would be a good member of your team than using one of these assessments.
A background check company conducts pre-employment screening for employers and looks at the background and history of someone applying to a business. These checks can be customized to the needs of a particular company so that pertinent information on a candidate can be more carefully scrutinized. A long-haul truck company may be more interested in an applicant’s driver history and training schools attended than his/her credit history. A school will be more concerned with a thorough check of sex offender registries than they will be of a driver history. All employers may want to know that their employees have proper I9 credentials to ensure their workers are working legally in the United States. Based on the position search criteria may be even more stringent. The depth and intensity of the checks can be determined by the background check company and the business. The important thing to know is that you can learn a lot more about who an applicant is through pre-employment screening than through a test/assessment that may not give a true picture of the person you are considering for the job.
Aside from my own experience I also want to share the story of another person who has been affected by one of these assessments. I met a homeless man and had a conversation with him. During the course of our conversation, I asked whether he had applied to a store nearby where I knew they were hiring and have a need for hard working, freight team members. The gentleman said he had applied and even had an interview but had failed the company’s assessment so they couldn’t hire him. I was furious. Not only was this man not out panhandling or asking for handouts, he was trying to apply for work and was turned down because of one of these STUPID assessments. And while he may have been telling me a story I don’t believe he was because I have failed one and I have a college degree and over 34 years of work experience.
I do not know this guy any more than I know the men who traveled to the moon. What I do know is had the business he applied to relied on a background check company to run a pre-employment screening in lieu of an assessment, he may have had a chance to pass and get a job. It is possible this business lost an opportunity to hire one fantastic worker. I know there are those who will be naysayers and insist that hiring assessments are unbiased and give the best evaluation of a candidate’s personality. Hold that thought. According to an article on the website “workable” titled, “Pre-employment Testing: pros and cons” by Nikolleta Bika, October 11, 2016, she lists the positives of pre-employment testing but she also lists the negatives of testing including: testing can be discriminatory, they invite lies and tests assume unique people are made through molds. https://resources.workable.com/tutorial/pre-employment-testing What I am trying to point out is testing is not necessarily going to give you the best candidates and you may cheat yourself out of a great employee. Use pre-employment screening and your interview process to get the best candidates for your team.
Get more information on pre-employment screening, contact us or call 1.770.426.0547 today.
Clothing security- 4 WC Blog 524
Checkpoint tags-5
Checkpoint Tags Help Offset Tight Employee Budgets
Clothing security can be difficult for small and medium size retailers that have limited resources. As a Retail Loss prevention Manager I had to deal with shoplifters and employees who have stolen clothes so I have seen the various methods employed by criminals. One of the favorite forms of theft for shoplifters and I include employees in this, is the use of fitting rooms and restrooms to commit their crimes. Rather than trying to hide merchandise in a purse, shopping bag or under their clothing and risk being observed by store cameras or plain clothes security they go where they know that cameras are not permitted. Thieves know that most stores restrict Loss Prevention personnel from making what are known as “fitting room” stops and the same applies to restrooms. In order to prevent shoplifting many of the large retailers will spend payroll on a fitting room attendant. This person’s job is supposed to be taking all merchandise from a customer, separating the items, inspecting to be sure nothing is in between items and there are not multiple items on a single hanger. It may not be feasible for smaller stores to spend scarce payroll dollars on a fitting room attendant. This is where clothing security can be enhanced in the form of Checkpoint tags available from Loss Prevention Systems Inc.
Checkpoint tags for clothing are available in a sturdy design that is built to prevent shoplifters from defeating them. Tugged, pulled, pried or beaten on these tags will hold up to the most severe punishment. Of course it should be pointed out that in my encounters with anyone trying to pull a tag off of clothing they are usually putting so much effort into it they become obvious. Those shoplifters that choose to try to conceal tagged clothing and attempt to get out of a store will set off an electronic article surveillance (EAS) alarm pedestal. The alarms and lights of the pedestals are so bright and noisy that employees respond and recover merchandise through a check of the culprit’s receipt. An employee well trained on appropriate EAS alarm response knows how to keep encounters calm and recover merchandise without a nasty confrontation.
The question arises, “Why can’t I just look in a fitting room and if there are empty hangers then I can simply stop the suspect?” You can never be absolutely sure that a hanger is an indicator of theft. Some people try on clothes and if they find a garment they like they don’t bother putting it back on a hanger. When I was a Loss Prevention Associate and brand new to the retail world I worked in a department store. I vividly recall going into a fitting room and bringing out a handful of clothes hangers. I showed them to the associates at the register and told them that someone had probably stolen the items that went on those hangers. The associates were none too pleased with me, a guy new to L.P. and retail. One of the associates took the hangers and told me that they do count items going in and out, not necessarily hangers. That associate, who is now my wife, kindly reminds me of that encounter from time to time to keep me humble. Clothing security was a priority then and items were counted but we did not use Checkpoint tags as much then as we should have. Clothing alarm tags can reduce the need to have a fitting room attendant for stores without the payroll to staff that position.
Restrooms can be another problem altogether because they are often in a corner or out of the main aisles of the store. EAS towers can be placed outside of the restrooms and if merchandise with Checkpoint tags is taken in the tower alarms will sound there too. Towers can’t be placed outside of a fitting room because the purpose of a fitting room is to take merchandise in to try on. Security tags on clothes provide protection for retailers when they can’t afford to place a person at the fitting room. As I mentioned if they tamper with tags they will damage the clothes, leave the tags in place and they will activate alarms.
If you have the resources to afford a fitting room attendant to stop shoplifting then continue to do so and let Checkpoint tags be a supplement to your security efforts. If you don’t have the resources, tag all of your merchandise with clothing security tags and watch your profits grow.
Get more information on Checkpoint tags, contact us or call 1.770.426.0547 today.
Clothing security can be difficult for small and medium size retailers that have limited resources. As a Retail Loss prevention Manager I had to deal with shoplifters and employees who have stolen clothes so I have seen the various methods employed by criminals. One of the favorite forms of theft for shoplifters and I include employees in this, is the use of fitting rooms and restrooms to commit their crimes. Rather than trying to hide merchandise in a purse, shopping bag or under their clothing and risk being observed by store cameras or plain clothes security they go where they know that cameras are not permitted. Thieves know that most stores restrict Loss Prevention personnel from making what are known as “fitting room” stops and the same applies to restrooms. In order to prevent shoplifting many of the large retailers will spend payroll on a fitting room attendant. This person’s job is supposed to be taking all merchandise from a customer, separating the items, inspecting to be sure nothing is in between items and there are not multiple items on a single hanger. It may not be feasible for smaller stores to spend scarce payroll dollars on a fitting room attendant. This is where clothing security can be enhanced in the form of Checkpoint tags available from Loss Prevention Systems Inc.
Checkpoint tags for clothing are available in a sturdy design that is built to prevent shoplifters from defeating them. Tugged, pulled, pried or beaten on these tags will hold up to the most severe punishment. Of course it should be pointed out that in my encounters with anyone trying to pull a tag off of clothing they are usually putting so much effort into it they become obvious. Those shoplifters that choose to try to conceal tagged clothing and attempt to get out of a store will set off an electronic article surveillance (EAS) alarm pedestal. The alarms and lights of the pedestals are so bright and noisy that employees respond and recover merchandise through a check of the culprit’s receipt. An employee well trained on appropriate EAS alarm response knows how to keep encounters calm and recover merchandise without a nasty confrontation.
The question arises, “Why can’t I just look in a fitting room and if there are empty hangers then I can simply stop the suspect?” You can never be absolutely sure that a hanger is an indicator of theft. Some people try on clothes and if they find a garment they like they don’t bother putting it back on a hanger. When I was a Loss Prevention Associate and brand new to the retail world I worked in a department store. I vividly recall going into a fitting room and bringing out a handful of clothes hangers. I showed them to the associates at the register and told them that someone had probably stolen the items that went on those hangers. The associates were none too pleased with me, a guy new to L.P. and retail. One of the associates took the hangers and told me that they do count items going in and out, not necessarily hangers. That associate, who is now my wife, kindly reminds me of that encounter from time to time to keep me humble. Clothing security was a priority then and items were counted but we did not use Checkpoint tags as much then as we should have. Clothing alarm tags can reduce the need to have a fitting room attendant for stores without the payroll to staff that position.
Restrooms can be another problem altogether because they are often in a corner or out of the main aisles of the store. EAS towers can be placed outside of the restrooms and if merchandise with Checkpoint tags is taken in the tower alarms will sound there too. Towers can’t be placed outside of a fitting room because the purpose of a fitting room is to take merchandise in to try on. Security tags on clothes provide protection for retailers when they can’t afford to place a person at the fitting room. As I mentioned if they tamper with tags they will damage the clothes, leave the tags in place and they will activate alarms.
If you have the resources to afford a fitting room attendant to stop shoplifting then continue to do so and let Checkpoint tags be a supplement to your security efforts. If you don’t have the resources, tag all of your merchandise with clothing security tags and watch your profits grow.
Get more information on Checkpoint tags, contact us or call 1.770.426.0547 today.
