Returns Abuse and First-Party Fraud: Why Service, Risk, and Finance Need to Work Together

By Markus Bergthaler | April 2026

When people talk about e-commerce fraud, they usually start with stolen cards or account takeover. Those are real problems. But a lot of loss shows up in a quieter place first: returns, goodwill, "item not received" claims, damaged goods, missing items.

The uncomfortable part is that it does not always feel like fraud. It feels like service. A customer reports a problem, the team wants to help, and nobody wants to look petty over one case. That is where it gets difficult.

Not every bad case is bad intent

I do not believe in treating every customer as suspicious. Sometimes parcels really do go missing. Sometimes a process is badly explained. Sometimes the customer is right and the company is wrong. That has to be part of the conversation.

But patterns matter. Repeated "not received" claims. Similar complaints. Too many refunds without return. Returns that technically fit the policy but make no commercial sense anymore. If nobody sees those patterns, they are processed as isolated service cases.

Service decides now, finance sees it later

Service teams often make decisions under pressure. The customer is waiting. A poor review is possible. The order value may not feel high enough to argue over. So the refund or replacement is approved.

Finance sees the total weeks later. Risk may see a pattern, but without the service history. Operations sees the logistics cost. Each team has a piece of the truth, but nobody has the whole picture. That is why these issues often sit unresolved for too long.

Goodwill needs boundaries

Goodwill matters. Especially in e-commerce. But goodwill without measurement is not customer centricity. It is guesswork. A clear rule is not automatically harsh. A generous rule is not automatically customer-friendly if the cost eventually gets pushed back onto honest customers.

I would not start with a complicated control system. I would start with visibility. Which cases repeat? Where do teams decide differently? Which product groups generate unusual refunds? Which customer patterns stand out? And where is the problem not the customer, but the process itself?

What I would look at

I would begin with simple questions. How often do we refund without return? How often does that happen for the same customer? Which cases later become chargebacks? How well do we document delivery proof and service communication? Is there a moment where service, finance, and risk look at the same data together?

These questions sound simple. In practice they rarely are. But once answered properly, they usually show whether the company has a fraud problem, a service problem, or a process problem. Often it is a mix.

My view

Returns abuse and first-party fraud are not side issues. They sit inside the customer experience. That is why they should not be handled only from a risk perspective. Good solutions protect margin without punishing honest customers. That is the balance that matters.