Newspaper article The Christian Science Monitor

Businesses Fight Coupon Fraud

Newspaper article The Christian Science Monitor

Businesses Fight Coupon Fraud

Article excerpt

AMERICAN industry is stepping up the offensive against coupon and rebate fraud.

"Most people don't realize it, but every coupon is really currency," says Sharrie LaCroix, an official with Ralston Purina.

The Missouri-based food conglomerate is sending out large numbers of coupons these days for its wheat, corn, and rice cereal products, and knows that it has to be alert to prevent fraudulent misuse of its coupons, Ms. LaCroix says.

Neal Perlowitz, owner of Direct Mail of Westchester in Ossining, N.Y., personally meets the owners of every business that he mails coupons for, to make sure the firms are "above-board" and, in the case of rebates, will honor the terms of their offers. His firm sends out large numbers of coupons to over 200,000 households.

Law enforcement experts say there is good reason for the care taken by Ralston Purina and Mr. Perlowitz. Coupon fraud - such as buying bags of coupons from church or charity groups and then turning them in for redemption without ever using them to purchase products - is a growing crime in the United States.

The amount of money US companies lose to coupon fraud annually is probably higher today than the $500 million estimated by a 1983 study, says Bud Miller, operations manager of the Coupon Information Center (CIC), a business-sponsored monitoring group in Alexandria, Va.

The latest twist: coupon counterfeiting, in which criminals use advanced color copier machines to reproduce coupons.

Another growing problem is rebate fraud. Unlike coupons, which lower the purchase price of an item, rebates provide a partial repayment of the purchase price to the customer. A preliminary study by the Rebate Information Center, also in Alexandria, finds that rebate fraud may be costing businesses more than $300 million annually, on top of their tab for coupon fraud. …

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