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Burden of Proof

Holiday Gift Returns: Knowing Your Rights Before Heading to the Mall

Aired December 26, 2000 - 12:30 p.m. ET


ROGER COSSACK, CNN ANCHOR: Today on BURDEN OF PROOF: For some, the real holiday shopping season began this morning. Stores are offering up huge sales and brace for a rush of returns. How about you? Exchanging that gift from Uncle Ralph? Well, you better know your rights before heading to the mall.

ANNOUNCER: This is BURDEN OF PROOF, with Roger Cossack and Greta Van Susteren.

COSSACK: Hello and welcome to BURDEN OF PROOF. Greta is off this week.

Well, Christmas may be over, but the shopping season isn't. For many Americans, Dec. 26 is the biggest buying day of the year as stores offer huge discounts to lure shoppers back into the malls. But some customers may not need luring as they flock to return gifts that weren't quite what they were hoping for, and others try to figure out how to send back real-world gifts purchased in cyberspace.

And joining us today from Boston is Paul Jamieson, senior vice president of banking and payment services with And from Seattle, we're joined by Bill Curry of And in Washington, Linda Golodner, president of National Consumers League.

And taking the pulse of the retail heartbeat, CNN's Deborah Feyerick at the Jersey Garden Outlet Mall in Elizabeth, New Jersey.

Well, Deborah, what's happening at the mall in Elizabeth, New Jersey? Are the people bringing back gifts?

DEBORAH FEYERICK, CNN CORRESPONDENT: A number of the people really are bringing back gifts. Either they didn't fit right or they just didn't like them. A number of people got here pretty early in the morning.

But what we're really finding speaking to a number of these people is that they're just here to take advantage of these massive sales. You know, there's this whole layering and discounts going on. Before Christmas, there was 10 percent or 20 percent off. Now after Christmas, they're finding another 20 or 30 percent. So one man we actually spoke to said he waited until after Christmas to buy what he wanted. He had his eye on it, came back first thing this morning, and he picked it up. COSSACK: Deborah, do you see -- is there grumbling about returning gifts? I mean, are there long lines? Do you hear people saying that they just can't seem to get what they want or that at least that they're not getting the kind of service they need?

FEYERICK: Well, there are definitely lines. You definitely have to be patient on a day like today. But for the most part, the sales clerks are doing a good job handling all of this. Because it is a Tuesday, you simply don't have the volume of people that you had over the weekend. A number of people are back to work. So the sales clerks are just doing the best they can. And some folks who wanted their money back are finding that they're getting store credits instead.

COSSACK: All right, joining me now is Chris Campbell, who is the team leader from Target in Silver Spring. He's joining me by phone.

Chris, what's it like with Target? What are you doing for people who want to return their gifts?

CHRIS CAMPBELL, TARGET: Oh, Roger, we're having a great day today. People are definitely returning, but -- absolutely right -- not at the same pace. And what we're doing is we have extra people at the service desk area so when we take their returns we can help them quickly. We launched an aggressive campaign in November to really educate them to have those receipts and be ready to do their returns the day after.

COSSACK: All right, let me give you a little hypothetical. Suppose I have a gift from a Target store. I don't know from what Target store, I don't have a receipt, and to tell you the truth, I don't want old Uncle Ralph to know that I'm taking the gift back. So what I do is show up with this package and I say, I think this came from you. I don't know where and I don't know how and I don't know how much and I don't have a receipt. What will you do for me, if anything?

CAMPBELL: Well, the great thing about Target is it doesn't matter what Target store it came from across the country, we can return any Target product at any store throughout the nation. So what we would do is go ahead and attempt to process that return and probably give you a store credit. Hopefully, though, Uncle Ralph included your gift receipt, which doesn't give you the price of the item on the receipt, but it allows you to do a return.

COSSACK: All right, now let's suppose that Uncle Ralph didn't give me the gift receipt. All I got was a package and a tie that glows in the dark. Now what do I do?

CAMPBELL: Well, we just need to talk with the clerk and see if it's possible to ring it up through the system. There are some departments that are limited for their returns, but we do have some flexibility there in doing a return. But it is really important that you save that receipt.

COSSACK: OK, joining me now from Washington is Linda Golodner. Linda, what are my rights if I want to take something back and I have this tie and I don't have a receipt, I don't have anything. Are their rights that I have that the store must honor?

LINDA GOLODNER, NATIONAL CONSUMER LEAGUE: Well, you know, some stores will provide information for you actually when you make the purchase so you know what your rights are, but it depends on the state. Some states vary with regard to return laws. Certainly if you have gotten some information or gotten a product from a door-to-door sales, you have rights to return. If you're buying something on the Internet, certainly look at those policies. But you really have to check the policies of the store.

COSSACK: Now, let me -- let's just suppose -- and we've been talking about this same hypothetical, that I don't have a receipt, I just have a box that says Target or says some other department store or some other vendor. What -- is there something -- and I go in and I give them back my tie. Do they have to take it back? And suppose I don't want a store credit. Suppose I don't like that store. Can I get cash? What do they have to do and what don't they have to do?

GOLODNER: It depends on what they told you in the first place. If they said they're going to take it back or if they'll just give a refund, that's what you're going to get. Certainly in most products you have -- you know what store it came from, hopefully. But if you don't know the store and you don't know where it came from, they don't have any responsibility to take it back.

COSSACK: All right, what can I do to make things easier for myself to get that credit? And, by the way, do I have a right to get cash?

GOLODNER: You have a right to get cash. Some stores just want to give you a credit and you might have to argue. You have to be an aggressive consumer. But certainly keep a paper trail. Paper trails, no matter where you bought your product, is very important. When you go back to that store, if you have the paper, if you have the receipt, that helps a lot. If you bought it online, make sure that you print out where it came from, when you made that purchase, and then you might be able to return it.

COSSACK: But to get more specific, I have -- now, let me just say this. I have this receipt and I walk in and I see all these ties and I just don't like any of them. Now I say, listen, you know what, I want cash. Do they have to give me cash, or can they give me credit instead? Or is it up to them?

GOLODNER: It depends on the store policy. And if they have said up front that you were just going to get a refund, then you're not going to get your cash.

COSSACK: Linda, what do you mean "up front"? Is there -- should there be a sign? How will I know what their policy is?

GOLODNER: Well, it could be a written policy, it could be a policy that you're told about when you make the purchase. Often people are sort of left without any information, though, on return policies.

COSSACK: That's my point. You know, I bought a lot of Christmas gifts this year and I can't remember ever seeing anything about what the policy was. How do I know?

GOLODNER: That's why you should really do some pre-purchase information for yourself so that you know whether or not you're going to be able to return a product. We often say that if you buy by credit card, too, you have some more, additional legal rights to return or to get credit for what you purchased.

COSSACK: All right, we'll talk more about those credit cards when we come back. Let's find out about returning or exchanging that gift that come from a cybershopper. Stay with us.


According to a study conducted by America's Research Group, 36 percent of Internet shoppers didn't check the return policies of the online retailers from which they purchased products.



COSSACK: Holiday shopping on the Internet doubled this year. This according to a Goldman Sachs study. Now, total online holiday spending topped $8.7 billion through last week. In the same period in 1999, consumers spent just $4 billion on the Web.

Well, Bill Curry of Amazon, what would you say is the main reason that there was such so much of an increase in online shopping this year? And doesn't it create new kinds of problems for the consumer?

BILL CURRY, AMAZON.COM: Well, any time of the year, the benefits of shopping on the Internet are selection, convenience and price. When you can shop 24 hours a day, seven days a week from your home or office computers, that's really a tremendous appeal. During the holiday shopping season, those three benefits become even more valuable to you. You don't want to go to the mall and get trampled, you don't want to park and walk several miles just to get to the store. So it's the convenience, the selection and the price.

COSSACK: But, Bill, taking all of those into consideration -- and those certainly are three considerations that are worthwhile -- now you have the other side of the issue. There's no one that you've ever dealt with in terms of a person, and now it's time to return these gifts that you've hopefully gotten through the mail. What does a consumer do about returning the gifts, and how do you get credit or how do you get your money back?

CURRY: The experience is based on three things: One, we try to prevent returns in the first place by helping you make the right purchase decision, get exactly what you want the first time, forget about a return. But if you do need to return something, we have a 30-day, no-questions-asked policy on returning things. And then we have a return center that makes it fast, easy and convenient for you to return your gift or your own individual purchase.

COSSACK: Bill, what happens -- I'm sorry -- what happens if I purchase something from any of these online vendors and it gets lost in the mail. Whoever is supposed to deliver it, whether it be Federal Express or someone else, it get lost in the mail. Who's responsible for that?

CURRY: Well, I can't speak to other vendors, but I can tell you that at our mission is to make people happy and to give customers the benefit of the doubt and have a pleasant and successful shopping experience. So we would address cases like that on an individual basis.

COSSACK: Well, I mean, since wants to make me happy, wouldn't they just come out right now and say if something gets lost in the mail they'll take the responsibility for it?

CURRY: What we would probably do is to ship you a replacement item. And then if the original item showed up, we'd arrange for you to return it to us and get the original item back to us.

COSSACK: What about something that's late? Supposed to be delivered by Christmas, it doesn't get delivered till three days after Christmas. Who's responsible for that?

CURRY: Well, we did a tremendous job last year for customers, and even better this year where we shipped well in excess of 99 percent of orders in time to arrive for the holidays.

COSSACK: Now what about the notion of just returning and getting credit back? Is it Amazon's procedure that if I just don't like what I've gotten, I can just send it back right away?

CURRY: You can send it back for any reason or no reason. And particularly during the holiday season, our usual 30-day policy is waived. Things that have been bought from Nov. 15 through Dec. 31 you can return as late as Jan. 31 and still get full treatment.

COSSACK: Now, who pays the shipping expenses when I send it back to you? And what happens if I've taken this product and I've taken it out of the box and, you know, I've set it up and it's just not exactly what I want and now I have to return it back and I can't get it back into the original box, so I have to sort of pack it up as best I can? What happens with that?

CURRY: It depends on the particular item. If you've opened a DVD or software or something like that, we, at our discretion, can charge you a restocking fee. If it's broken or it was damaged in shipment, while we'll be glad to take it back.

COSSACK: What exactly is a restocking fee and how much is it?

CURRY: That would vary based on what the product is.

COSSACK: For example, let's take a DVD player. CURRY: It would be at our discretion depending on the condition it's in. Are all the parts there? Is there packaging that it can be resold?

COSSACK: What is the most it could be?

CURRY: That is -- depends on the product and what the condition is and we don't have that kind of fixed number for you.

COSSACK: All right, joining me now is Paul Jamieson from Boston.

Paul, I hadn't forgot about you. Let's talk a little bit about credit cards and spending some money on the credit cards. When you buy online, obviously you have to do it through a credit card. Who's responsible for security of my credit card, or anyone's credit card?

PAUL JAMIESON, GOMEZ.COM: Well, the credit card companies know that security is still a major concern among consumers, particularly online, and they're trying to do whatever they can to gain consumer confidence. And so the -- right now, the credit card companies are taking liability for the security of purchases. That means if something were to happen to your purchase online, the credit card firm is at liability and they take responsibility for that.

COSSACK: So in other words, if I give my credit card to one of these online vendors, and let's suppose someone hacks in and gets my personal information and uses my credit card number to start buying other gifts. Is it the credit card company that will take responsibility for that?

JAMIESON: That's correct. All the major firms -- American Express, Discover, MasterCard and Visa -- have zero liability policies at this point, which means that a consumer does not have any financial responsibility for a fraudulent transaction used on their card.

COSSACK: All right, now let's suppose that we have this hypothetical: Someone buys a product, uses their credit card, gets it in the mail and it's not what they wanted, attempts to return it back to the people that sold it to them, they say they won't take it back. The purchaser then says, well, I don't want to pay for it. I'm ordering you, Mr. Credit Card Company, not to pay for this. Who ends up paying for what under those circumstances?

JAMIESON: Yes, there's a process that takes place at that point. Again, the customer would have had to have contacted the merchant to try to resolve the dispute first. If they've tried to resolve that dispute and still have not received any satisfaction, they can then go to their credit card company and do what they call a merchant dispute, which is meaning they can talk to the credit card company, tell them that they are disputing the transaction. That transaction will be set aside, meaning that the credit card company will not hold the credit card customer liable for that transaction until that dispute is resolved. And there will be no financial -- finance charges on that transaction until that dispute is resolved. The credit card company will then go to bat for the cardholder with that merchant to try and resolve it in the most equitable way. COSSACK: What should we expect the credit card company to do? You just said the credit card company would "go to bat" for the consumer to try and resolve the dispute. What should the credit card company be expected to do?

JAMIESON: Well, the idea is that there is two parties in this -- in a dispute, and obviously there's something fair and equitable between each party. The card company will stand in between and look from both perspectives and try and reach an equitable dispute between the merchant and the cardholder.

I have personally gone through this twice and -- since I've been using credit cards -- and both have been resolved in my favor. So it's been personally beneficial to me.

COSSACK: All right, let's take a break. We'll have more about online shopping and returning gifts to cyberspace after this short break. Stay with us.


Q: On which two days of the week do retailers recommend exchanges/returns be made?

A: Monday and Tuesday, which are commonly the slowest shopping days.



COSSACK: Online retailers have spent millions making cyber- purchases easier and safer for their customers, but Internet shoppers are also looking for easier ways to return items bought from dot.coms.

Bill, the future of the Internet, I think, is tied directly to the future of the security that the buyer feels when giving up their private information. What are you and your other Internet retailers doing to make sure that people's credit card information is kept safe?

CURRY: Well, there are three things we do. We have -- we use a secure server, where all of the information is stored. That's -- that's a very, very secure server. Secondly, all of the information that you send to us regarding your credit card number is encrypted on the Net so it can't be stolen. And then we offer a safe-shopping guarantee that if something were to happen with your card and there was an unauthorized charge as a result of your purchase at, we're going to hold you harmless and pick up even the $50 that the credit card issuer usually doesn't cover.

COSSACK: Linda, that's -- we heard what will do. But what about other places? What are they required to do, or if anything? Suppose that somehow, because of -- I give up my credit card or someone gives up their credit card information, and that information then gets out: Who's responsible? GOLODNER: Well, you've got to look to see if it is a secure site. But unfortunately, often credit card numbers are stolen in different ways, and often people aren't even careful when they make a purchase in the real world.

Online you certainly do have the protection of having legal rights for dispute with your credit card company. I think it's important that you check the privacy policies and check to see if the site is secure. And that -- by that little key or lock in the corner to make sure that there is a lock in the corner, and that you follow the URL, the address at the top of the page to make sure it is a secure site.

COSSACK: Paul, what's some of the -- what does the future look like in terms of security for the person who buys on the Internet?

JAMIESON: Sure. As I said, the credit card companies are trying to do all they can to instill confidence in consumers, in their customers to shop online. One of the interesting technologies that we've seen recently is what they call surrogate numbers. This -- this allows a cardholder to shop online, and instead of giving their actual card number, they would give a surrogate number.

Therefore, if somebody were to misappropriate that number, it can't be used for anything else. It would not be authorized at any other merchant. And so it gives a higher degree of safety when shopping online.

American Express offers this. Discover now offers this. MBNA, a company that issues Visa and MasterCard, is launching this, and we understand that Chase will be offering it on their credit cards shortly.

COSSACK: Paul, do I have any resource, though, if someone hacks in and gets my information and goes ahead and runs up a bill? Can I just say I don't want to pay it?

JAMIESON: Well, you do anyway because of the zero liability policy that each of the credit card firms now have. But this also protects, adds another layer of protection on that in that even if they were to get that credit card number, it isn't your actual credit card number, so that nobody could even use that number as they could somebody's actual number.

COSSACK: All right. I'm afraid that's all the time we have today. Thanks to our guests and thank you for watching.

Later today, I'm going to be hosting "TALKBACK LIVE," and our issue this afternoon is the Clinton legacy. Were the last eight years good for you? I hope so.

Send in your e-mails and tune in at 3:00 p.m. Eastern Time.

And tomorrow, actor Robert Downy Jr. is arraigned in court -- again. Will he be headed back to prison? That's our show tomorrow on BURDEN OF PROOF. We'll see you then. TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT


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