This is some food for thought for chronic complainers.
Food delivery services are plagued with “refund fraud,” as customers demand money back for alleged unsatisfactory orders — even if there was nothing wrong with the items received.
According to a new report from the fraud prevention company Incognia, nearly half of delivery app consumer fraud is “refund abuse,” which cost businesses an estimated $103 billion last year, a separate report from Appriss Retail and Deloitte found.
“You can say the food wasn’t good, the food was cold, there was something missing,” Incognia CEO and co-founder André Ferraz told Business Insider. “How do you verify these things? It’s very difficult.”
The average consumer can request a refund for a handful of orders in a row on most delivery apps, but too many refund requests can result in the account being flagged and “the platform will not allow you to ask for refunds,” said Ferraz.
“You’re abusing the platform,” he added.
But some scammers create multiple accounts with various phone numbers and emails in order to pull off the heist and receive more than the allotted refunds.
Incognia reported that one fraudster created more than 200 delivery app accounts, placed over $5,000 in orders and received $4,163 back in fraudulent refunds, meaning they received thousands of dollars in product for just $851.
Tutorials for the get-rich-quick scheme have circulated social media and the encrypted messaging app Telegram, according to CNBC.
“You need to keep up with all the things that fraudsters are creating,” warned Ferraz.
Some companies are taking action, such as Uber Eats, which vowed to take “fraudulent behavior seriously,” according to Business Insider, and monitors behaviors of both drivers and customers, reserving the right to refuse adjustments for “suspicious refunds.”
Meanwhile, DoorDash introduced a four-digit PIN system to address fraud on the platform last year. At the time, the delivery company said that, although a “vast majority” of consumers are honest, there are some who make “inaccurate” or “false” reports.
Igcognia also found a second kind of consumer fraud called promotion fraud, in which malicious actors use multiple accounts to abuse promotions, such as “repeatedly claiming a new user discount.”
According to the report, one user was able to exploit $2,000 worth of promotions over the course of a month from 400 various accounts, a scheme that can cost companies their budgets.
“This method of abuse can drain marketing campaign budgets, increase user acquisition costs, and distort growth metrics,” the report said.
