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National Conferences Articles

High Value Coupon Fraud

by Jeyin Lee | 06/13/2019

By Bud Miller, CPP, Executive Director, Coupon Information Corporation

Consumer response coupons can be a great method for manufacturers to enhance customer relations when challenges arise or to reward loyal consumers who have expressed their appreciation for excellent products or services. Consumers love them; manufacturers reinforce purchasing patterns and enhance their image. All this happens without incurring the costs of shipping products to a consumer.

Unfortunately, like all things of value, consumer response coupons are subject to fraud and abuse. The two most common types of fraud are counterfeiting the coupons and filing false complaints in order to obtain coupons. If left unchecked, these illegal activities can cause significant expenses for the manufacturer; in some cases, the financial impact can be in the millions of dollars.

One common scam is to file false complaints about a product with the intent of obtaining free product coupons or something else of value. We have observed such efforts organized in social media, often by so-called extreme couponers. Retaining and reviewing consumer complaints can help manufacturers shed light on these situations. The data may also help manufacturers respond more efficiently in the event of a real problem that has not been previously detected and can help determine if a complaint is legitimate or a hoax. Similar to the sale of canned term papers, we have observed individuals selling “complaint services” which result in scripted letters and emails being transmitted to multiple manufacturers regardless of whether the purchaser has even had any experience with the product. Much of this can be addressed with cross-complaint review by seeking to identify identical complaints or phrases.

Screening for duplicate submissions can also be a significant opportunity. Care must be taken not to just use a pure dupe process; the address data should be standardized to US Postal Service standards prior to duplication review as the addition of fake apartment or suite numbers is commonly used. We recently observed a number of individuals plotting to steal from a manufacturer using this fake, but deliverable, address trick in a secret Facebook group.

E-mails can also be falsified but functional using the “dot trick” which is well-known throughout the darker corners of social media. A review of emails compiled in a simple spreadsheet can be remarkably effective in detecting this sort of deception.

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