Re: Is it a crime to buy the same item cheaper at one store and
I have a related question to this topic. I understand that it may be fraudulant to return something for more than you paid for it. However, there are some interesting potential circumstances I would think would have bearing on the situation. Refering to Chain retailers, where each store may make different pricing/clearance decisions that don't reflect accross the entire chain: If store A has an item on clearance, and it can be purchased at $1, store B (and possibly all the other stores) VALUE that item at $5, why is it fraud to accept the higher amount (and we are talking about store credit here, not cash)? Isn't it simply a market? Store A values the item at one price, and store B values it at another? Isn't it indeed fraud on the chain's part to sell higher priced items without informing the customer they are available at cheaper prices in other of their own stores? Wouldn't this be a double standard? We can do it , but you can't? They buy for a cheaper price than they sell at, why is this different, especially if they set the sale price, and the return price, and it is all done in store credit anyways? All cash flow is into the business, not to the customer. It seems to me that when customers with gift receipts return items and get lower prices than is on the receipt just because it's a gift receipt is WRONG. If retailers, especially chains, are going to have policies to accept returns without receipts, then they should insure that they don't return them at higher prices than they were purchased at, anywhere in the chain.
Re: Why Is Return Fraud Illegal?
Those illegal returns will help put a store out of business. If it was legal, a lot of people would be returning items to a store that was purchased at another to make money. I'll give you a small figure example: Imagine the item was $2 cheaper at a different location. If it was legal, at least 50 people would be trying to return the item to make some money. That will be a $100 lost for that store. Now imagine 10 different items the same day. That will equal a$1000 lost. Or picture someone buying $500 of the item on clearance (50% off, $5 each). Next that person would take the items to a store that sells the same items with no clearance ($10 each). The store will be loosing $500. The item was probably on clearance at one store because of low sales. The other store was selling the item full price because of good sales. If the returns were legal, it would keep away all clearance sales away unless the same company stores would try to put each other out of business.
Re: Why Is Return Fraud Illegal?
I understand the effects of what it can cause, and I am not debating that returning something to a store where you didn't buy it is legal. What I am saying is if I did buy something at a CHAIN retailer, and one of their stores had an item on clearance, and none of their other stores did, and I buy it cheaper and return to the other CHAIN store as allowed by their return policy, is that fraud, and why? Especially if I indicate that it was purchased on clearance, and they respond with, "we can only give you store credit for whatever price comes up in the computer". The first store is the one who decided to accept a lower profit margin, and that sale is done. The second store VALUED the item just as all the others are priced on their shelves and gave STORE CREDIT, not cash for it. This is a market, just as in the Stock market where Market Makers find opportunity between the selling price of one buyer, and the buying price of another, and make the difference. That is a perfectly legal and common practice; and I can guarantee you that the buyer or seller is not told that their is better opportunity available to them. Except this doesn't deal in cash, only store credit. Remember, the 2'nd store now has the merchandise, presumable in resale condition (assume it was never opened) that they VALUE at what they supplied in store credit. They will then presumably sell it for that value and get CASH. The only part of this that lost anything was the 1'st store which CHOSE to lower their own profit margin.
So, considering that, please explain to me if this is fraud, and why (in actual law, not in moral examples), because I don't see it. At best, it is a chain store not in full control of it's pricing and tracking processes and business model.
Re: Why Is Return Fraud Illegal?
More to the point, legally, and exactly, why are those returns illegal? Not by the effects they may cause, but what Law actually says it illegal?
Re: Why Is Return Fraud Illegal?
Re: Why Is Return Fraud Illegal?
I am mostly concerned with New York. Possibly New Jersey and Pennsylvania as well. However, if this is indeed illegal, I would think that some variant of the same thing would exist in every state.
Re: Why Is Return Fraud Illegal?
no takers on if this is illegal?
Re: Why Is Return Fraud Illegal?
No takers on researching the statutes of multiple states for you. It appears you'll have to do that yourself. Beyond that, you've had some discussion of why return fraud is illegal.
Re: Why Is Return Fraud Illegal?
ok, I can appreciate that, and I will do some research. Except this is an "Expert Law" forum, so I figured there would be some actual discussion of law, and not just statements made like "that is illegal" without any explaination of it.
So instead how about a more philosophical discussion of how this return fraud (as I have outlined it) it is fundamentally different from selling items in general? Unless nobody really cares (feel free to say so and I'll shut up).
If I did return items to the 2'nd store and they only gave me the $1 (in store credit) and they were selling the items for $5. They have now taken the "unfair advantage" They will profit twice from the item. The other choice is that they then sell all those items at $1, which will either cause them to make much less $ or lose $.
So that isn't right either, and they won't do that.
The price an item sells for is determined by what the market will bear. People and stores buy and sell based on perception of value, and little else.
If I took my $1 item and sold it to an individual for $4, it is because getting it at $1 was obviously an extreme undervalued item. The market for that item is more like $4 - $5.
In doing so, I assumed risk. I may not have been able to sell, something may have happened to it while in my possession, etc. That is the definition of doing business, assuming risk to hopefully profit.
When stores buy mechandise from their wholesaler, they are doing the same thing. They assume risk in order to hopefully eventually profit by selling that item at it's market value. The store, it's employees, the merchandise, the policy to accept returns and typically lose money or at best break even on them are all examples of the cost of doing business, and part of the risk they have chosen to assume in order to profit.
They will not profit on every item, and they know it, and acknowledge it as the cost of doing business.
They took back the return at $5, because that is what they value it at. The 1'st store is the one who made the poor judgement, by grossly undervalueing the item.
The definition of fraud is to intentionally get money or property of value by deceit or misrepresentation, which is what every store does everytime they sell something. They won't tell you how much they paid for it, only that they paid less. Sometimes they don't pay less, and they won't tell you that either. All sales employ deceit unless the profit is disclosed.
In this case of returning for $5, where is the deceit or misrepresentation? The store determined the value, not the person returning it.
If I had sold that item to a person for $4, is it fraud? I certainly aren't going to tell them I only paid $1 for it. They buy for $4 because that is what they value it at. Am I employing deceit or misrepresentation?
If I had returned it to the store for $1, and they turned around and sold it for $5, is that fraud? The person buying it wouldn't reasonably expect to have provided the store a 400% profit, but they don't indicate that to him. Is that deceit or misrepresntation? He bought it for $5 because that's what he valued it at.
So, the question becomes whose misrepresentation is right, and whose is wrong, and why?
Re: Why Is Return Fraud Illegal?
Also, Aaron, I haven't had any "discussion of why return fraud is illegal" as you noted .
I had one person reference, "Those illegal returns", with no explaination of the topic, which is "WHY is return fraud is illegal", followed by a rudimentary math lesson. (thanks Guilty or Not Guilty, for showing me how to multiply 2 x 50 x 10, it has always baffled me)