Online stores like Flipkart and Amazon have easy return policies that can help reassure customers that it's safe to order online and even buy high value items, but this also leaves sellers vulnerable to fraud.
According to a report in the Bangalore Mirror, Veera Swamy, 32, of Vanasthalipuram in Hyderabad, placed orders on Flipkart, received goods, and then allegedly replaced the items he ordered with fake items, which he would return to Flipkart.
Swamy apparently ordered over 200 items in the last 20 months, which were booked in the name of his mother, father, wife, brothers, and other neighbours, all totalling over Rs. 20 lakhs in value. According to the Bangalore Mirror, Swamy created fake email IDs and made bank payments through different accounts - when he allegedly returned the fake items, he would get a full refund on the different accounts.
"We are verifying the contents of the complaint and the accused version," Vanasthalipuram police inspector P Pushpan Kumar who is investigating the case, told the Bangalore Mirror.
This allegations are shocking because of the scale involved, but this problem is not a new one for companies like Flipkart and Amazon. Just as there have been cases of customers getting a brick instead of a phone, so too have sellers faced cases of fraud, and by and large, the e-commerce sites are willing to turn a blind eye right now.
On Amazon India's seller forums, you'll find lots of sellers discussing this very issue. One seller, Ashish, writes about how he sent a package worth Rs. 64,500, and the customer claimed it was empty when it arrived. Ashish denied this but, writes that Amazon agreed to refund the cost of the item, rather than investigate the matter.
Another seller, Barnes, who sells designer clothing, writes that the designer shirt he shipped was replaced with a tailored shirt instead, which he described as "a really bad piece of work."
On Reddit, he writes:
Due to extremely buyer friendly practices of these online sites there is a huge potential for buyers to cheat sellers. These kind of cases were rare a year ago but I've seen a rising trend. As buyers are getting more comfortable buying online and as they are understanding how it works they've figured out how easy it is to game the system. These cases are not a lot right now but its growing and if something is not done about it there will be a lot of problems in the future.
All these online sites are very hard on the sellers. We are the fall guys for them. Whenever a buyer returns a product we have to bear the loss of the courier fees as well as the site commission. It's brutal. Till now though, I've found that Snapdeal treats its sellers a little better than others.
Greatest customer protection would be Amazon. They are just fantastic for buyers. As sellers I dread any complaint I get from an Amazon buyer. How? Mostly because of their return policies, seller rating systems, and claims.