Indeed, the fastest-growing area of fraudulent activity in direct marketing, which employs the telephone and nonpersonal media to communicate infomation to customers,who then purchase products via mail, telephone, or the Intemet.
In 2000, consumers reported losses of $138 million resulting from fraud to the Federal Trade Commission.
In 2001, the FTC received an estimated twenty-five thousand complaints about Intemet fraud alone.
Consumer Fraud Of course, companies and their employees do not hold a monopoly on fraud.
Consumers have also been known to attempt to deceive businesses for their own gain.
Shoplifting, for example, accounts for nearly 32 percent of the losses of the 118 largest U.S. retail chains, although this figure is still far outweighed by the nearly 49 percent of losses perpetrated by store employees, according to the national retail security survey.
Together with vendor fraud and administrative error, these losses cost U.S. retailers more than $31 billion a year.
Among others, actress winona ryder was convicted of shoplifting in 2002.
Consumers engage in many other forms of fraud against business, including price-tag switching, item switching, lying to obtain age-related and other discounts, and taking advantage of generous retum policies by retuming used items, especially clothing that has been worn (with the price tags carefully concealed, but not removed).
Such behavior by consumers hurts retail stores as well as other consumers who, for example, unwittingly purchase new clothing that has actually been worn.