Running a retail store has always come with challenges—but in 2025, fraud has become one of the fastest-growing threats facing businesses of every size. Organized retail crime gets most of the headlines, but many store owners are also dealing with digital scams, returns abuse, and new tactics that can quietly eat away at profits.
At this year’s NRF PROTECT event, retail security leaders from Walmart, Meijer, and Signet Jewelers outlined the top fraud schemes their teams are battling right now. The good news? Knowing what to watch for is your first step to staying one step ahead.
Here are 8 retail fraud schemes every store owner should have on their radar in 2025 — whether you operate one location or multiple.
1. Gift Card Fraud and Money Laundering
Gift cards have become a favorite target for criminals because they're nearly impossible to trace once redeemed. In many cases, fraudsters drain gift card balances before customers even use them, sometimes months after purchase.
Law enforcement agencies (including through operations like Project Red Hook) are now focusing on these sophisticated schemes, but retailers must remain vigilant when selling and processing gift cards.
What store owners can do:
Limit high-dollar gift card purchases.
Train staff to watch for bulk purchases by unfamiliar customers.
Use POS settings that flag unusual gift card transactions.
2. Ghost Tap and Tap-to-Pay Scams
Using stolen credit card data loaded into digital wallets, criminals make bulk purchases of gift cards or high-ticket items, often to resell for cash. These scams are especially difficult to spot because the payments may appear legitimate through tap-to-pay terminals.
What store owners can do:
Review merchant processing rules for digital wallets.
Use fraud filters that monitor rapid-fire transactions.
Set daily purchase limits for contactless payments.
3. Victim-Assisted Scams
Organized crime groups sometimes coerce everyday customers into participating in fraud. Victims may be convinced to buy large quantities of baby formula, health products, or beauty items under the promise of reimbursement. These items are later returned or resold illegally.
What store owners can do:
Watch for repeat bulk purchases of easily resold items.
Establish return policies that discourage repeated large returns.
Flag suspicious customer behavior for internal review.
4. Phishing, Smishing, and Consumer Payment Scams
Fraudsters impersonate legitimate organizations via phone, text, or email to trick employees or customers into sending payments, often through gift cards or cryptocurrency. Many small businesses have reported employees unknowingly responding to fake invoices or urgent payment requests.
What store owners can do:
Train employees to recognize phishing and scam attempts.
Set strict protocols for processing outside payment requests.
Never authorize gift card purchases for unexpected invoices.
5. Returns Abuse
Returns abuse remains one of the most common (and costly) forms of fraud for retailers. Some bad actors falsely claim items never arrived, return used or damaged goods, or even swap out products with counterfeit or worthless replacements.
What store owners can do:
Require original receipts for returns.
Inspect returned merchandise thoroughly before issuing refunds.
Track frequent returners through your POS system.
6. Quick Change Scams
These old-school scams are still effective, especially in cash-heavy departments like jewelry. Scammers create confusion at the register by flashing large amounts of cash, repeatedly asking for change, and manipulating cash counts to short the register before walking away with merchandise.
What store owners can do:
Train staff to limit extended cash transactions.
Require supervisor approval for large or complex cash exchanges.
Use cameras at registers for post-transaction reviews.
7. Online Account Takeovers
Fraudsters hijack customer online accounts and place large orders for in-store pickup. They then impersonate the customer at pickup using fake IDs or order confirmations, leaving stores short on inventory and out the cost of the goods.
What store owners can do:
Require secure ID verification for in-store pickups.
Implement stronger customer account protections online.
Use multi-factor authentication where possible.
8. Manually Keyed Card Fraud
When a chip or swipe payment “fails,” scammers may request to manually enter stolen card numbers. Without card-present verification, these transactions often lead to chargebacks, leaving the retailer responsible for the loss.
What store owners can do:
Limit manual entry transactions.
Require manager approval for manually keyed purchases.
Work with your merchant processor to flag high-risk transactions.
"Fraud isn’t just a corporate problem — it’s hitting independent retailers too. The best defense is combining smart staff training with the right POS and payment systems that give you visibility into returns, payments, and customer behavior. Even small steps today can prevent much bigger losses down the road."
At Thriving Retailer, we help store owners build stronger, smarter retail operations that protect your profits and simplify your processes.
If you're ready to upgrade your POS, strengthen your merchant processing, or improve your team’s fraud prevention training, schedule a FREE consultation with Rachael or explore our Done-for-You Retail Solutions today.
Stay informed. Stay prepared. And let’s keep your store thriving.