Index clamps down on serial refund cheats

Pests who use stores as if they are libraries are to be targeted by Index, Littlewoods' catalogue store chain.

The retailer has begun a three-month pilot scheme in Leeds, enabling the identification and deterrence of so-called 'frequent returners' - fraudsters who return stolen goods for refunds, 'borrowers', who take back items that they claim are unused, and those who return goods not even bought at the store.

Using sophisticated software, Index aims to combat shoppers with a track record of suspicious returns by compiling a customer returns history database that can be accessed online.

At present, retailers can be stymied by liberal returns policies designed to build customer satisfaction and loyalty, but which also may make them susceptible to fraud.

Index will be able to score customers on various criteria, accumulating points that determine the type of return to be offered, such as cash, cheque or vouchers.

According to the system's developer Refund Exchange, the approach does not breach data protection rules.

Refund Exchange managing director Paul Collins said the software offered a means of providing rapid verification of customer details and therefore speedier detection of fraudulent behaviour.

Theft and fraud by customers costs store groups£770 million a year, according to the British Retail Consortium.