Best Buy's return policy says most products can be returned within 15 days for a refund or exchange, but the company doesn't always follow its own policy. The problem is return fraud, where a customer might return a used or even stolen item for a refund, abusing a retailer's return policies — a problem that affects 11% of all returns. Some companies handle fraud by curtailing their return policies: L.L. Bean is a notable recent example. The store, which has long offered a generous "no questions asked" return policy, had to drop the policy to prevent shoppers from using it as a lifetime product replacement program.
Best Buy found an answer to return fraud in a third party company called The Retail Equation, which analyzes return behavior to detect fraud. Whenever you return an item, TRE's algorithms go to work to see if it's likely that you're abusing the return program. If the algorithm thinks you're a risk, your return may be denied — or you could be barred from returning items in the future, no matter what the return policy says.
Sometimes that's a problem even for legitimate customers. According to an article in the Wall Street Journal, a California man found himself banned from making returns at Best Buy for a year after he tried to return three cell phone cases. He bought cases in several colors as gifts for his kids, assuming he could return the unwanted colors within Best Buy's return window — but his return was red flagged by The Retail Equation. When he asked about the problem, Best Buy referred him to TRE, but he didn't get satisfaction. He's not the only one: unhappy customers have been taking to Yelp to complain about TRE denying their returns and then giving them the run-around when they complain.
The problem with the "shadow" return policy enforced by TRE is that no one knows what it is. TRE won't tell you why your account is flagged or under what conditions it could be flagged. But the Wall Street Journal identified seven things that could impact your chances of being flagged:
- making too many returns in a short timeframe
- returning items without a receipt
- returning items that are often stolen
- returning items after a certain period of time
- returning items at store closing time
- returning high-value items
- returning a large percentage of your total purchases
Shoppers don't realize their information is being shared or know how it's being used — and once TRE decides to flag you, you may not be able to get unflagged. That usually means no more returns at your favorite stores.
The Retail Equation is used by 34,000 stores nationwide, including Best Buy, CVS, Dick's Sporting Goods, Home Depot, JCPenny, Sephora and Victoria's Secret. Each store uses the service differently — for example, Home Depot only uses it for returns without a receipt — and each may have a different policy about banning returns. Despite posted return policies, any store using The Retail Equation could deny your returns without explanation.
Best Buy has responded to the controversy by opening a hotline to call if your return has been denied. While that's more helpful than being told to call TRE, it's still a frustrating extra phone call to make after you've already been to the store to make a return. If you feel your return at Best Buy has been denied without cause, you can call them at 866-764-6979 to (hopefully) sort things out.
In the meanwhile, be sure you're familiar with a store's return policies before you buy. They give you an idea of what to expect. And if you can, try to avoid returns that may look suspicious to The Retail Equation's algorithms, such as returns without receipts. That's still no guarantee your return won't be denied, but it may help.
[Image credit: Best Buy store via BigStockPhoto]