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‘Friendly fraud’: Online retailers are grappling with new forms of digital deception

It’s an abiding retail maxim that the customer is always right. The credo tends to work well for the retailers that follow it — except, of course, for those occasions when the customer is actually wrong, deliberately. Retailers have long dealt with theft-related fraud at their stores, but newer forms of digital deception have proliferated in recent years amid higher online sales and improved security techniques at bricks-and-mortar stores. Fraud losses as a portion of retailers’ online revenue rose to 1.47 per cent in 2016 from 1.32 per cent last year and 0.68 per cent in 2014, according to a report by LexisNexis Risk Solutions, a risk management firm in Atlanta. Retailers generally don’t like to talk about how much they’re losing to online fraud, but it’s a new facet of a very old problem, said Michael LeBlanc, senior vice-president of Marketing and Digital Retail at the Retail Council of Canada.

By: Hollie Shaw
Read the full article on The Financial Post.