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Washington--Fewer retailers are expecting fraud return rates to grow this holiday season, due in part to enhanced return policies and requiring identification from customers when receipts are not present during the return process.

“Those who think they will be able to get away with manipulating a company’s return policy will be sorely disappointed this holiday season,” Joe LaRocca, senior asset protection advisor for the National Retail Federation, said.

According to the NRF’s annual Return Fraud Survey, the retail industry will lose an estimated $3.48 billion to return fraud this holiday season, down from $3.73 billion in 2010.

The survey shows that nearly nine in 10 retailers (89 percent) say they have experienced the return of stolen merchandise in the last year, and just as many report that employee return fraud or collusion with external sources has been a problem in the past year.

“Wardrobing”--the return of used, non-defective merchandise like special occasion apparel--also poses an issue, as more than six in 10 retailers (61 percent) say they have been victims of this activity within the last year. Additionally, eight in 10 retailers (81 percent) say they have experienced the return of merchandise purchased fraudulently or stolen and 39 percent have found criminals using counterfeit receipts to return merchandise.

When asked if their company has ever changed its return policy to specifically address return fraud, nearly two-thirds of retailers (64 percent) said they had.

“Retailers have been putting checks and balances in place to prevent people from taking advantage of stores’ return policies, which raises prices for honest shoppers,” LaRocca said.

The growing problem of return fraud has forced many retailers to adopt policies that require customers returning merchandise to show identification. Retailers have made significant progress in reducing fraudulent returns when a receipt is present. The survey found 3 percent of returns with a receipt are fraudulent, down from nearly 4 percent in 2010.

Retailers estimate that 14 percent of returns without a receipt are fraudulent. As a result, six in 10 retailers (62 percent) now require customers returning items without a receipt to show ID. Around 10 percent of retailers require customers making returns with a receipt to show ID.

According to an NRF survey conducted last December, 88 percent of Americans feel retailers’ return policies are fair.

Most respondents (83 percent) said their return policies will remain unchanged this holiday season, on par with last year, but slightly more retailers (13 percent vs. 11 percent in 2010) will tighten their policies to combat excess return fraud during the holiday season.

The NRF’s sixth annual Return Fraud Survey polled loss prevention executives at 103 retail companies in October 2011. Executives from discount stores, department stores, drug stores, supermarkets and specialty stores participated in the survey.