Amazon is punishing customers who return too many items — and it's a disturbing trend sweeping across the retail industry (AMZN)


Amazon is said to be barring customers the company thinks have returned too many items.

The Wall Street Journal on Tuesday documented complaints that the e-commerce giant had barred customers who had returned items. Amazon apparently failed to alert the customers that they had returned too many items before the bans.

The Journal spoke with two people and cited dozens more online who said they had been barred from Amazon, as well as others who received emails from the company after returning some items.

The two people who spoke with The Journal seem to be part of a wave of hundreds of people who were barred from Amazon in late March and early April, as previously reported by Business Insider.

The wave of account closings were apparently linked to concerns regarding review fraud.

Some people in private Facebook groups who were barred from Amazon admitted to violating policies through activities like leaving good reviews in exchange for a reward, such as gift cards. Some said they may have committed acts, such as reviewing products they received free or at a discount, that they did not realize were not allowed. And others said they had no recollection of violating the company's policies.

Returns can create issues for retailers. In addition to costing the company money, some Amazon customers may also be purchasing items and then returning them in exchange for payment or rewards, falsely inflating the reviews of third-party sellers.

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Cities most eager to lure Amazon HQ2
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Cities most eager to lure Amazon HQ2

Washington D.C.

14% of respondents are willing to pay more in taxes to lure Amazon to their city.

Austin, Texas: 

14% of respondents are willing to pay more in taxes to lure Amazon to their city.

Denver, Colorado: 

14% of respondents are willing to pay more in taxes to lure Amazon to their city.

Pittsburgh, Pennsylvania:

15% of respondents are willing to pay more in taxes to lure Amazon to their city.

Philadelphia, Pennsylvania: 

15% of respondents are willing to pay more in taxes to lure Amazon to their city.

New York City:

16% of respondents are willing to pay more in taxes to lure Amazon to their city.

Chicago, Illinois:

16% of respondents are willing to pay more in taxes to lure Amazon to their city.

Los Angeles, California:

17% of respondents are willing to pay more in taxes to lure Amazon to their city.

Boston, Massachusetts:

18% of respondents are willing to pay more in taxes to lure Amazon to their city. 

Columbus, Ohio:

19% of respondents are willing to pay more in taxes to lure Amazon to their city.

Atlanta, Georgia: 

19% of respondents are willing to pay more in taxes to lure Amazon to their city.

Raleigh, North Carolina:

20% of respondents are willing to pay more in taxes to lure Amazon to their city.

Dallas, Texas:

21% of respondents are willing to pay more in taxes to lure Amazon to their city.

Miami, Florida:

21% of respondents are willing to pay more in taxes to lure Amazon to their city.

Nashville, Tennessee:

23% of respondents are willing to pay more in taxes to lure Amazon to their city.

Indianapolis, Indiana: 

26% of respondents are willing to pay more in taxes to lure Amazon to their city.

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"We want everyone to be able to use Amazon, but there are rare occasions where someone abuses our service over an extended period of time," an Amazon spokesman told The Journal. "We never take these decisions lightly, but with over 300 million customers around the world, we take action when appropriate to protect the experience for all our customers."

Amazon is not alone in this. Best Buy, Home Depot, Victoria's Secret, and a host of other retailers are discreetly tracking how often shoppers return purchases and, in some cases, punishing people who are suspected of abusing their return policies.

In March, The Journal reported that the third-party company The Retail Equation keeps "return activity reports" on customers dating back several years. If The Retail Equation notices activity it considers fraudulent, customers can be punished.

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All of President Trump's Twitter attacks on Amazon
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All of President Trump's Twitter attacks on Amazon
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Fraud costs retailers up to $17 billion annually in the US, according to The Retail Equation.

"Rather than forcing retailers to impose stricter return policies such as 'no receipt, no return' or 14-day limits on returns, the system actually allows retailers to offer the other 99 percent of consumers more lenient and flexible return policies," the company says on its website.

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SEE ALSO: Furious customers say they've been mysteriously locked out of their Amazon accounts — and they have no idea why

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