Urgent: Possible FSA/HSA Fraud & High Return Rates on Eligible Products
I’m reaching out about a serious issue with FSA/HSA-eligible purchases on Amazon that’s impacting our business. Over the past year, return rates for our higher-priced FSA items have surged from 10–15% to around 50%. When we removed the most expensive product, the next highest-priced item saw a similar spike. Additionally, in the final days of December, we see a dramatic increase in sales for FSA items, followed by an even higher rate of returns.
It seems there may be a loophole where customers purchase FSA/HSA items, return them, and specifically request store credit. This behavior is damaging our business and may constitute misuse of FSA/HSA funds, which could potentially be a violation of U.S. tax regulations.
Could Amazon please urgently address the following questions:
1. Does Amazon allow customers to receive store credit for returned FSA/HSA purchases?
2. Could we receive a report showing:
- The percentage and count of returns purchased with FSA/HSA funds
- The percentage and count of FSA/HSA returns where store credit was requested
- The count of returns from customers who have multiple FSA/HSA returns with store credit requests
Right now, our only immediate solution is to pull these products from FSA/HSA eligibility, which is not ideal. We need to address this issue swiftly to avoid further losses.
Any insights or solutions would be much appreciated.
Urgent: Possible FSA/HSA Fraud & High Return Rates on Eligible Products
I’m reaching out about a serious issue with FSA/HSA-eligible purchases on Amazon that’s impacting our business. Over the past year, return rates for our higher-priced FSA items have surged from 10–15% to around 50%. When we removed the most expensive product, the next highest-priced item saw a similar spike. Additionally, in the final days of December, we see a dramatic increase in sales for FSA items, followed by an even higher rate of returns.
It seems there may be a loophole where customers purchase FSA/HSA items, return them, and specifically request store credit. This behavior is damaging our business and may constitute misuse of FSA/HSA funds, which could potentially be a violation of U.S. tax regulations.
Could Amazon please urgently address the following questions:
1. Does Amazon allow customers to receive store credit for returned FSA/HSA purchases?
2. Could we receive a report showing:
- The percentage and count of returns purchased with FSA/HSA funds
- The percentage and count of FSA/HSA returns where store credit was requested
- The count of returns from customers who have multiple FSA/HSA returns with store credit requests
Right now, our only immediate solution is to pull these products from FSA/HSA eligibility, which is not ideal. We need to address this issue swiftly to avoid further losses.
Any insights or solutions would be much appreciated.
1 reply
Quincy_Amazon
Hello @Seller_WojwvN2JCFmaf
Thank you for posting your inquiry to the Forums.
From the FSA/HSA Home page - "Can I return an item purchased using a FSA or HSA card?" Yes. A refund will be issued to the original FSA/HSA card. Gift card refunds aren’t available for items purchased using a FSA or HSA card.
To request a return report, you can utilize the return report tool in your Seller Central account. I have included a Seller University video below that details how to generate a return report:
Amazon is not able to provide returns data. If you need additional guidance on getting a returns report for your account, please feel free to reach out to our Support team.
Regards,
Quincy_Amazon
