How 'Refund Only' Policies and Shipping Insurance Are Undermining Merchants(AI Translation)

【周刊提前读】“仅退款”与运费险如何滋生侵占商户利益黑产

The summary should provide an understanding of the systemic exploitation of e-commerce platforms' refund and shipping insurance policies that have led to significant issues for merchants, platforms, and customers alike.

**Summary of Corresponding Paragraphs in the Original Text**

An e-commerce merchant, Xu Yang, shared that out of 200 orders, there were over 20 "refund only" cases and 80 return-and-refund cases, leading to an after-sales rate of 50% [para. 1]. This was a result of customers exploiting discount promotions. The term "shearing the wool off sheep" refers to taking advantage of small benefits, resulting in a rapidly growing black and gray market industry chain exploiting these policies [para. 2].

The Supreme People's Procuratorate defines "black market activities" as illegal and criminal internet activities, whereas "gray market activities" sit at the edge of legal boundaries, supporting black market operations [para. 3]. Pinduoduo introduced the "refund only" policy in 2021 to protect consumer rights and improve product quality, pressuring merchants. By the end of 2023, other platforms like Taobao, JD.com, and Douyin had also adopted similar policies [para. 4].

However, this policy was exploited. Discount purchasing agents on Xianyu, a second-hand goods trading platform, provide 20%-30% discounts by making fraudulent refund claims [para. 5]. The process involves purchasing items at full price, requesting a refund via "refund only" after delivery, and profiting from unreturned goods, leaving merchants at a loss [para. 6]. Shipping insurance has also become a loophole exploited for profit. Operators place bulk orders with shipping insurance, request returns, and earn the payout differential [para. 7].

Many black and gray market operations use shill bidding techniques and engage in bulk ordering, warehousing, and delivery services. These activities are openly discussed on platforms like Baidu forums [para. 9].

Incidents have shown how difficult it is to gauge the financial impact of shipping insurance exploitation. Warehouses can process up to 1,000 packages daily related to such claims, with significant profits from low shipping costs [para. 10]. Police cracked cases of massive shipping insurance fraud involving tens of thousands of claims and hundreds of thousands of yuan in illegal profits [para. 11].

The exploitation of "refund only" and "shipping insurance" is widespread across major platforms like Taobao, Pinduoduo, and Douyin. Despite risk control measures, e-commerce platforms have struggled to address these issues effectively. The platforms' focus on consumer satisfaction has sometimes strengthened these fraudulent activities [para. 14].

A police officer noted that these exploits could be avoided if platforms actively investigated and banned related accounts [para. 15]. Merchants have attempted to defend themselves through lawsuits, but the costs are often prohibitive, leading to substantial losses [para. 20]. Meanwhile, e-commerce platforms are continuously upgrading their policies to combat these activities [para. 21].

Shipping insurance exploitation has developed into a full-fledged black market chain involving various roles like account producers, tech providers, and logistics operators. Despite strict regulations, the adaptive nature of black market participants has made it challenging for platforms and authorities to completely eradicate these activities [para. 34].

Finally, reporting to the police faces jurisdictional challenges and complexities in coordination. The decentralization and constant evolution of scam tactics make it difficult to trace and prosecute perpetrators [para. 38]. Merchants are experimenting with their countermeasures, such as changing pricing structures and reporting courier services in an effort to mitigate losses [para. 45].

Overall, while platforms and insurance companies are improving their risk control measures, the dynamic and dispersed nature of the black and gray market for exploiting e-commerce policies poses ongoing challenges. The problem endures despite repeated crackdowns due to its covert, decentralized execution and the adaptability of fraudsters.