INDUSTRY UNLOCKED
INDUSTRY ANALYSTS ALREADY ESTIMATE RETURN FRAUD COSTS IN THE BILLIONS ANNUALLY, AND THIS FIGURE IS ONLY SET TO GROW AS THESE AI TOOLS BECOME EVEN MORE ACCESSIBLE AND POWERFUL. items. Other examples include creating fake documentation to claim warranty service for outof-warranty products, generating receipts with inflated purchase prices to secure larger refunds to gift cards, enabling internal fraud through fabricated expense receipts and producing convincing payment confirmations as part of larger social engineering attacks. The financial implications are staggering. Industry analysts already estimate return fraud costs in the billions annually, and this figure is only set to grow as these AI tools become even more accessible and powerful.
The customer experience dilemma
Perhaps the most challenging aspect of this evolution in fraud for retailers is its impact on legitimate customer experiences. To mitigate fraud, retailers are having to implement more extensive verification procedures – and honest customers inevitably will face increased friction during returns and exchanges.
This creates a significant challenge – implementing stricter verification processes
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