Myntra Loses Over Rs 50 Crore Nationwide In 'Refund Scam': Know How Scammers Operate

The company has faced financial losses due to fraudulent claims, with estimates indicating a nationwide loss exceeding Rs 50 crore.

Representational Image | Myntra, a fashion website owned by Flipkart, has lost millions of rupees in a refund scam.

In a sophisticated refund scam, Flipkart-owned fashion website Myntra has lost millions of rupees after fraudsters exploited the company's customer-friendly refund policies. The loss came to light amid the audit process of the company. 

During this modus operandi, fraudsters place bulk items for high-value items like branded shoes, accessories, and apparel from E-commerce platforms. After the orders get delivered, they file a false complaint claiming issues like incorrect items, non-delivery, or shortages.  

One of those E-commerce platforms, Myntra, provides customers with an option on its app to lodge complaints and claim refunds for issues such as order shortages, colour mismatches, or receiving incorrect items. Refunds are processed after complaints are received.

According to a report by TOI, the company has faced financial losses due to fraudulent claims, with estimates indicating a nationwide loss exceeding Rs 50 crore. In Bengaluru alone, around 5,529 fraudulent orders were detected, causing severe monetary damage.

Fraudsters Make False Claim

Detailing the modus operandi, a police officer explained that fraudsters would place orders for items like 10 pairs of branded shoes. Upon receiving the parcel, they would falsely claim that only five pairs were delivered and request a refund for the remaining pairs, which were either paid for online or via cash on delivery (COD).

According to the officer, a gang operating out of Jaipur, Rajasthan, was responsible for the fraud, with most of the fake orders originating from the city. The fraudsters used delivery addresses in Bengaluru and other metropolitan areas, with a few including commercial locations like tea stalls, tailor shops, and provision or stationery stores.

In a related incident, cybercrime officials recently arrested three individuals in Surat, Gujarat, for defrauding e-commerce platform Meesho by posing as both suppliers and customers. They allegedly swindled the company out of Rs 5.5 crore through fraudulent orders.

The case, registered under the Information Technology Act and IPC Sections 419 (cheating by personation) and 420 (cheating and dishonestly inducing delivery of property), is currently under investigation.