Internet Coupons: Theft at Checkout Counter?

Counterfeiting is on the rise, and in defense, some store owners in Madison (WI) and elsewhere are refusing to accept coupons printed on home computers.

"Counterfeits can be devastating, " said Bud Miller, executive director of the industry-sponsored Coupon Information Center. "A single instance can easily cost the manufacturer a million dollars if it's distributed on the Internet."

That's why the 12 Woodman 's stores in Wisconsin and Illinois don 't accept coupons printed from the Internet, said president Phil Woodman.

"We just don 't accept them because there 's too much fraud and theft, " Woodman said Monday. It 's difficult to communicate to checkers every day what coupons should be taken and which not, he said.

"You either have to take the coupons and suffer the consequences, or not take them at all, " he said. "We choose not to take them. "

With a softer economy, customers are looking to maximize buying power at the grocery store, and coupon values from manufacturers have increased by at least 10 cents since 2007, said Brandon Scholz, president and CEO of the Wisconsin Grocers Association.

"We expect that coupon usage for both manufacturers and in-store coupons as well as other discounts could increase this year by 20 percent, although we won 't know for sure until the redemption process and cycles are complete through the end of the year. "

Though the majority of coupons come from newspapers and magazines, Scholz said, fake coupons can be downloaded from the Internet, bought and sold on the Web or created at home using common software.

Counterfeit coupons were rare prior to 2001, but the Internet boosted activity. Hitwise, an online research company, reported that weekly visits in the U.S. to coupon Web sites increased 56 percent for the week ending June 6, as compared to the same week last year.

Consumers can help by being smart, Scholz said. "A good rule of thumb for consumers to determine whether or not an Internet coupon is legit is whether or not it seems reasonable, " he said. "If a coupon is too good of a deal, chances are it 's a fake.

"Coupons tend to be less than a dollar, so if someone finds a coupon for $5 or $10 or for a free product with a high retail cost, it 's probably a fake."

Eddie Roberson, general manager at Pierce 's Supermarket on Madison 's North Side, said he hasn 't gotten many complaints since the sign rejecting home-printed coupons was posted at the cash register in March, but then, he doesn 't know how many of his shoppers have Internet access.

But when counterfeit coupons do make it through the system, Roberson said, the store loses money. "We give the shopper credit (for the amount), not knowing they are counterfeit coupons, " he said.

When the store submits fake coupons for reimbursement, retailers learn the coupon is worthless. "Most, but not all, counterfeits are for free products or are of such high value that they are nearly free products, " said Miller.

"There have also been allegations that some counterfeiters obtain large amounts of products and then resell them in competition with honest retailers. "

One consumer product manufacturer estimates its losses to counterfeit coupons now exceed $3 million a year, according to a study this March by the CIC, a Virgina-based nonprofit group funded by large manufacturers.

"Another manufacturer became aware of a counterfeit free product coupon after CIC purchased it on a major auction Web site, " the study said. "The cost of this single counterfeit exceeded $300,000.

"New ones are frequently identified, sometimes on a weekly basis. Moreover, it is impossible to determine the number of counterfeits that quietly slip through the coupon redemption process undetected. "

Miller said the first big wave of homemade counterfeit coupons hit the industry near the end of 2002 through 2003 -- and the numbers are slowly increasing.

Shoppers may end up covering a manufacturer or retailer's financial loss by paying higher prices, Scholz said, and items may get scarce if they are targeted by counterfeiters.

In addition, counterfeiting slows things down at the checkout counter, Miller said. "Retailers have to add more security at the point of sale which slows things down, " he said.

The CIC recommends a number of things manufacturers and retailers can do to thwart coupon fraud, including a hologram as an optical security device printed across the face of the coupon.

Two years ago, the Wisconsin Grocers Association instituted an e-mail alert system linked through CIC to manufacturers, out-of-state grocers ' associations and others. The e-mail alert is sent electronically to members when new counterfeit coupons surface, Scholz said.

"It 's a message to counterfeiters -- you might sneak one or two in there, but probably not many more," he said.

Tim Metcalfe, president and co-owner of Metcalfe Sentry, said his two stores -- one in Madison, the other in Wauwatosa -- still take Internet coupons. He said he relies on counterfeit coupon alerts to stay on top of things.

"Coupon forgery has really kind of stepped up, " Metcalfe said Monday. "It 's just another way to steal."

I print grocery coupons at least once a week using PPGazette (Smartsource, Coupons.com). They use tiny fonts as a border and beneath the expiration date to prevent them from being photocopied, and the website itself uses a special printing program to keep you from making multiple copies.

I haven’t had any trouble redeeming them at Meijer or Kroger, at least not yet.

Something doesn’t smell right with this. Most manufacturers send out the coupon program to retailers in advance. Included are the code ranges, begin and end dates, description of the offer, and example coupons, at minimum. The retailer needs to input this into their POS system, so the scan picks it up and the system verifys and computes it.

Many retailers are never reimbursed for their coupons returns, as the manufacturers claim fraud or invalid dates or whatever. From my experience, it’s the retailers that do the most defrauding, causing the manufacturers to eliminate or more tightly control their coupons and offers.

I guess this story may be just a way for manufacturers to lay some blame on crime, so they can reduce or eliminate coupons, and they are prepping us. Then the consumer will just say...”yeah, too much fraud, I read about that”, and move on.

Woodman’s is such an exceptional supermarket, that I am happy to continue shopping there with or without Internet coupons. It is huge, prices are low, no tracking cards, clean and excellent selection (except in meats).

nd the website itself uses a special printing program to keep you from making multiple copies.

Many printers have a multi-copy setting in the BIOS. If you use a Windows print server, you can save the print job and do it again later. You can also "print to file" or PDF.

and the website itself uses a special printing program to keep you from making multiple copies.

Very VERY easy to override in many MANY ways. I can promise you there is no way a website can prevent you from printing multiple copies.

As the aforementioned printer multi copy setting, the print to PDF form, you can also take screen shots, as well as intercept the spool on both Mac and PC's easily.

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