Checklist template

Refund and return fraud controls for retailers

A ready-to-use checklist with 107 items in 6 sections, covering Policy enforcement, ID and receipts, Approvals, Reports, Gift card issuance, Trends. Use it as-is in InspectLoop, or adapt it to your own standards in minutes.

  • 6 Sections
  • 107 Items
  • 90 Yes / No checks
  • 6 Scored ratings
  • 120 Points

Use this template How audits work

1. Policy enforcement 18 items

  1. A sign at the service desk states that returns are recorded and that identification may be requested Yes / No 1 pt
  2. Receipts left in carts, at the registers or in bins near the entrance are collected through the day, so they cannot be used for a return Yes / No 1 pt
  3. Returns are processed only at the service desk or the registers designated by company policy Yes / No 1 pt
  4. The returned item is in the employee's hands before the refund is keyed Yes / No 1 pt
  5. Returned merchandise is brought to the desk by the customer from outside the store, not picked up from the sales floor Yes / No 1 pt
  6. The greeter or door employee marks items brought in for return with a dated sticker, where company policy requires it Yes / No 1 pt
  7. The system, not the employee, calculates whether the purchase date is inside the return window Yes / No 1 pt
  8. A return refused at one register is reported to the supervisor, so that it is not accepted at another register Yes / No 1 pt
  9. The employee compares the item with the receipt description (brand, model, size, color) Yes / No 1 pt
  10. Boxed returns are opened to confirm that the contents match the box Yes / No 1 pt
  11. The serial number of electronics and power tools is compared with the receipt or the purchase record Yes / No 1 pt
  12. Items with the store's own clearance or "final sale" marking are refused for refund Yes / No 1 pt
  13. Garments showing wear or a re-attached hang tag (wardrobing) are escalated to a supervisor before any refund Yes / No 1 pt
  14. The refund amount is the price paid on the receipt, not the current shelf price Yes / No 1 pt
  15. Coupon and promotion discounts are deducted from the refund Yes / No 1 pt
  16. A return of an employee's own purchase is processed by a manager, not by a coworker at the desk Yes / No 1 pt
  17. Three return transactions observed during the visit followed the policy Yes / No 1 pt
  18. Application of the return policy at the service desk Rating
    • Applied the same way to every customer 5 pts
    • Exceptions made without approval 3 pts
    • Policy not followed 1 pt

2. ID and receipts 18 items

  1. The original receipt is scanned or its transaction number keyed, so the system validates the purchase Yes / No 1 pt
  2. The system blocks a second refund against a receipt line already refunded Yes / No 1 pt
  3. The returned receipt is marked or kept so that it cannot be presented again Yes / No 1 pt
  4. Receipt lookup by payment card or loyalty account is used before a return is treated as non-receipted Yes / No 1 pt
  5. Refunds go back to the original form of payment Yes / No 1 pt
  6. A card refund is made to the card used for the purchase, not to another card Yes / No 1 pt
  7. Cash refunds for purchases paid by check wait for the period set by company policy Yes / No 1 pt
  8. Returns without a receipt are refunded at the lowest selling price in the period set by company policy Yes / No 1 pt
  9. Returns without a receipt are refunded as store credit only Yes / No 1 pt
  10. Government-issued photo ID is requested for a return without a receipt, where local regulation allows it Yes / No 1 pt
  11. The ID is scanned or keyed into the return authorization system rather than only looked at Yes / No 1 pt
  12. The system's decision to decline a non-receipted return is respected by the employee Yes / No 1 pt
  13. A manager cannot override a declined non-receipted return without a reason code Yes / No 1 pt
  14. A gift receipt is validated in the system against the original sale before the refund is given Yes / No 1 pt
  15. Online order returns are validated against the order number before the refund Yes / No 1 pt
  16. Customer identification data collected for returns is not written on paper kept at the desk Yes / No 1 pt
  17. Returns without a receipt processed last week Number
  18. Receipt and ID checks in the returns observed or sampled Rating
    • Verified every time 5 pts
    • Verified most of the time 3 pts
    • Rarely verified 1 pt

3. Approvals 18 items

  1. Refunds above the amount set by company policy require a supervisor's approval at the register Yes / No 1 pt
  2. The supervisor sees the customer and the merchandise before approving Yes / No 1 pt
  3. Each supervisor approves with a personal code or badge Yes / No 1 pt
  4. No approval code or supervisor badge is shared with or left for cashiers Yes / No 1 pt
  5. A cashier cannot approve a refund that the same cashier keyed Yes / No 1 pt
  6. Price overrides on a return require approval Yes / No 1 pt
  7. Returns without a receipt above the limit set by company policy require a manager Yes / No 1 pt
  8. Refunds to a payment form other than the original require a manager's approval with a reason code Yes / No 1 pt
  9. Post-voids of a whole transaction require a supervisor at the register at the time of the void Yes / No 1 pt
  10. Exchanges of unequal value are keyed as a return plus a sale, not as a price change Yes / No 1 pt
  11. Refund rights in the point-of-sale system are limited to trained service desk employees Yes / No 1 pt
  12. The list of employees with refund approval rights was reviewed in the last 3 months Yes / No 1 pt
  13. Refunds processed after closing or before opening are reviewed the next day Yes / No 1 pt
  14. Cash is taken from the till for a refund only with the refund slip printed Yes / No 1 pt
  15. The customer signs the refund slip, where company policy requires it Yes / No 1 pt
  16. Refund slips above the approval limit sampled (10 slips) each carried a supervisor's approval Yes / No 1 pt
  17. Slips out of the 10 sampled with no approval Number
  18. Supervisor approvals observed or sampled Rating
    • Given in person with the merchandise seen 5 pts
    • Given without seeing the merchandise 3 pts
    • Codes shared or approvals missing 1 pt

4. Reports 17 items

  1. The refund exception report is reviewed each week by the store manager or loss prevention Yes / No 1 pt
  2. The report ranks cashiers by number of refunds Yes / No 1 pt
  3. The report ranks cashiers by refund value Yes / No 1 pt
  4. Refunds with no matching original sale are listed for review Yes / No 1 pt
  5. Refunds keyed with a manually entered card number are listed for review Yes / No 1 pt
  6. Refunds made within minutes of the original sale are listed for review Yes / No 1 pt
  7. Refunds to a card used in several refunds are listed for review Yes / No 1 pt
  8. Video is reviewed for a sample of refunds to confirm that a customer was present Yes / No 1 pt
  9. The 5 most recent cash refunds above the approval limit were checked on video during the visit or in the last week Yes / No 1 pt
  10. Customers flagged by the return authorization system are listed in the report Yes / No 1 pt
  11. Findings from the weekly review are written down with the action taken Yes / No 1 pt
  12. Suspected employee refund fraud is referred to loss prevention, not confronted by the store Yes / No 1 pt
  13. Refunds last week as a percentage of sales (%) Number
  14. Refunds without a receipt last week as a percentage of all refunds (%) Number
  15. Name of the person who reviews the refund exception report Short text
  16. Date of the last documented review of the refund exception report Date
  17. Use of the refund exception report Rating
    • Reviewed weekly with documented follow-up 5 pts
    • Reviewed without follow-up 3 pts
    • Not reviewed 1 pt

5. Gift card issuance 17 items

  1. Store credit for returns is issued on a merchandise credit card, not as cash Yes / No 1 pt
  2. Merchandise credit cards are kept in a locked drawer or cabinet at the service desk Yes / No 1 pt
  3. The merchandise credit card stock is counted at the frequency set by company policy Yes / No 1 pt
  4. Merchandise credits above the amount set by company policy require a supervisor Yes / No 1 pt
  5. The customer's name or ID reference is recorded for a merchandise credit issued without a receipt Yes / No 1 pt
  6. A merchandise credit cannot be converted to cash at the register, beyond the small balances allowed by local regulation Yes / No 1 pt
  7. A merchandise credit cannot be used to buy third-party gift cards, where the system allows this block Yes / No 1 pt
  8. A refund of a gift card purchase requires the activation receipt and a manager's approval Yes / No 1 pt
  9. A refund of a gift card purchase is refused once the card has been used Yes / No 1 pt
  10. Balances are checked on the system before a returned gift card is accepted Yes / No 1 pt
  11. Returns of items paid with a gift card are refunded to a gift card Yes / No 1 pt
  12. Merchandise credits issued and redeemed the same day at the same store are listed for review Yes / No 1 pt
  13. Several merchandise credits issued to the same ID are listed for review Yes / No 1 pt
  14. Employees do not keep or use merchandise credits left behind by customers Yes / No 1 pt
  15. Voided or damaged merchandise credit cards are destroyed and recorded Yes / No 1 pt
  16. Merchandise credits issued last week Number
  17. Control of merchandise credits and gift cards at the service desk Rating
    • Secured, approved and reviewed 5 pts
    • Secured but not reviewed 3 pts
    • Unsecured or unapproved 1 pt

6. Trends 19 items

  1. The manager could state the store's refund rate for the last period Yes / No 1 pt
  2. The district's average refund rate for the same period (%) Number
  3. A list of the items most often returned without a receipt in the last period is on file Yes / No 1 pt
  4. The items most returned without a receipt are compared with the store's known theft list Yes / No 1 pt
  5. Returns of items not sold by this store or not sold recently are listed for review Yes / No 1 pt
  6. Repeated returns by the same customer are tracked through the return authorization system Yes / No 1 pt
  7. Groups returning the same item across several stores are reported to district loss prevention Yes / No 1 pt
  8. Price-switch returns (cheaper item returned in the box of a more expensive one) found at the desk are recorded as incidents Yes / No 1 pt
  9. Returns of emptied or substituted boxes found after the refund are recorded with the transaction number Yes / No 1 pt
  10. Returned merchandise is scanned back into inventory or to damages on the day it is returned Yes / No 1 pt
  11. Returned merchandise waiting at the service desk is kept behind the counter, out of customers' reach Yes / No 1 pt
  12. Return-to-vendor and damaged items leave the service desk each day Yes / No 1 pt
  13. Service desk employees have completed the company's refund fraud training Yes / No 1 pt
  14. Date of the most recent refund fraud training session Date
  15. An employee asked could describe two return fraud schemes seen in retail Yes / No 1 pt
  16. Actions from the last refund audit are closed Yes / No 1 pt
  17. Name of the service desk supervisor Short text
  18. Overall control of refund and return fraud Rating
    • Returns validated, approved in person and reviewed weekly 5 pts
    • Validated and approved, but exception report not followed up 3 pts
    • Refunds given without validation or approval 1 pt
  19. Corrective actions required Comments

About this template

This checklist is part of the InspectLoop template library. Yes / No checks score 1 point when met; ratings score the points shown for each option. The overall score is the percentage of points earned, with N/A answers excluded. In InspectLoop you can add photos, assign corrective actions, require sign-off and compare results across sites.

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