Leading retailers are breaking the law by failing to properly refund customers for returned goods, a Which? investigation has found.

Some of the UK’s biggest online shops routinely failed to reimburse delivery costs when customers returned unwanted purchases, while others failed to refund the cost of the goods themselves.

The consumer champion, Which?, sent 12 mystery shoppers across Great Britain to buy more than 200 items from 17 big online retailers in June and July.

The shoppers then returned their purchases by post – the most common method of returning goods – and tracked the entire process, from the cost of returning an item to whether they received the correct refund.

John Lewis came out on top, with shoppers praising the retailer for keeping them informed at every stage of the returns process. Its strong performance has seen it become the first retailer to receive Which?’s new recommended provider for returns status.

But at the other end of the table was clothing and homeware retail chain Matalan, which failed to refund customers properly in a series of cases.

Matalan does not offer free returns, and refunded the cost of the returned product to just seven of Which?’s 12 mystery shoppers. None received a refund for their original delivery fee.

In one case, a shopper returned an item costing £3.99. They had initially paid £3 for delivery and a further £2.99 to return it. When no refund was received, they were left £9.98 out of pocket, despite being entitled to lose only the £2.99 return cost.

One mystery shopper said: “There’s a returns label in the bag but it’s so faded that I can’t read the instructions.”

Matalan has been approached for comment.
Reena Sewraz, retail editor at Which? , said: “Returning an online purchase shouldn’t be a battle to get your money back. Yet leading retailers are breaking the law by failing to give shoppers the refunds they are entitled to.”
She said retailers “need to take responsibility for getting their returns processes right”, adding that shoppers “shouldn’t be left to foot the bill for retailers’ mistakes”.

Under the Consumer Contracts Regulations 2013, online shoppers generally have the right to change their mind and cancel an order within 14 days of receiving it, with a further 14 days to return the goods. Retailers must normally refund the customer within 14 days of receiving the returned item, although some products – such as personalised goods and items with a hygiene seal – are exempt.

Retailers can make customers pay the cost of returning unwanted goods, but they must also refund the standard delivery charge originally paid. Customers are not entitled to a refund of any additional premium they paid for faster delivery.

River Island and Sports Direct failed to refund the original delivery fee in any of the cases tested by Which? – despite retailers being legally required to reimburse standard delivery charges when customers exercise their statutory right to cancel an online purchase.

A Sports Direct spokesperson said: “Unfortunately, we are not able to provide any meaningful comment on the ‘mystery shopper’ claims.

“Despite requesting the basic details of the orders from Which? to be able to understand what has or has not happened with the specific transactions, they have refused to supply the necessary information. We of course seek to address genuine customer concerns.”

River Island has been approached for comment.

Both retailers also charge customers to return unwanted goods. While retailers are allowed to do this, the combination of return charges and missing delivery refunds left Which?’s shoppers significantly out of pocket.

The investigation also uncovered failures to refund the cost of the goods themselves. Pets at Home refunded just six of Which?’s 12 mystery shoppers for products they had returned.

Pets at Home said: “We regularly review our policies and the information available on our website to ensure customers have access to clear and accessible guidance on our terms and conditions. As always, if customers have any questions or concerns, we would encourage them to contact us directly.”

The findings raise fresh questions about how effectively leading retailers are complying with consumer protection rules and leave customers at risk of losing money when they return unwanted online purchases.

Which? said some retailers such as M&S did not qualify in the mystery shop because it didn’t offer postal returns on items bought online under £10 if you checked out as a guest – instead, you have to return in-store.

Argos also did not offer postal returns, so similarly could not be included.