When I first learned how to coupon, I learned from the most honest person I know—my mom. So when I first heard the term "coupon fraud," I remember thinking, "People are stealing coupons?"

Oh yes they were—and are.

In this post, learn what to look for to make sure the coupons you use are honest, legitimate savings tools.

Coupon fraud defined

The Coupon Information Corporation (CIC) acts as a watchdog organization for both consumers and retailers who use coupons.

  • Coupon fraud defined: "Coupon fraud occurs whenever someone intentionally uses a coupon for a product that he/she has not purchased or otherwise fails to satisfy the terms and conditions for redemption; when a retailer submits coupons for products they have not sold or that were not properly redeemed by a consumer in connection with a retail purchase; or when coupons are altered/counterfeited."

The most important word in the definition above is the word "intentionally." However, we all bear a shared responsibility to educate ourselves so we avoid committing coupon fraud.

The scope of coupon fraud

According to the Federal Trade Commission (FTC), each year $280+ billion in coupons are issued to consumers. Specifically, 3,000 manufacturers issue 300 billion coupons each year.

The CIC and others have taken "reality" television programs like TLC's Extreme Couponing to task for glamorizing "potentially illegal acts that appear to have been portrayed on the show."

The hard truth is, coupon scammers are committing a state and/or federal crime. Once caught, scammers can expect 3-5 years in prison and fines in excess of $200,000. 

The cost of coupon fraud

Coupon fraud costs coupon issuers (manufacturers, retailers) hundreds of millions each year, and it costs all of us in the long run.

Recently, a newspaper chain in Florida teamed up with a publisher to take a proactive stance against coupon fraud. Twelve newspapers and a publisher banded together to offer a $500 reward for "any information that results in stopping individuals or companies that obtain quantities of coupon inserts through unauthorized methods.”

Why did they do this? Isn't $500 a lot of money?

Actually, $500 isn't much compared to how much these papers are losing right now to coupon fraud. Newspapers make much of the money they require to stay in business through distributing those wonderful coupon inserts we KCLs look forward to each week. However, recently a ring of coupon scammers has been stealing and selling the inserts for a profit.

Imagine if your paper kept coming, but the coupon inserts suddenly stopped coming. How likely would you be to continue subscribing to the paper? This is the true cost of coupon fraud—companies going out of business, retail prices rising, and manufacturers and retailers ceasing to issue coupons for fear of encountering coupon fraud.

The CIC maintains an ever-lengthening list of manufacturer coupons revoked due to coupon fraud. This represents savings lost to us all due to coupon fraud!

How to find legitimate coupon inserts 

The Florida newspaper chain's action has made an impact on newspapers and publishers nationwide

One big question many are asking now is, "How can I be sure my coupon inserts are legitimate?"

How to know you’re using safe, honest inserts:

  • You get the inserts by buying a subscription to the newspaper, which arrives with inserts.
  • You pick up the inserts from the retailer while you’re shopping in their store (usually these come in the form of the weekly store ad which is available to customers in the store).
  • You pick up the inserts from a coupon "share box" at your grocer, community center, library, or other agreed-upon community location for sharing inserts.
  • Your friend trades you her newspaper coupon insert for another coupon she wants that you have that you don't plan to use. 

How to spot a fraudulent coupon

There are certain signs to watch for that can help identify a coupon scam or a fraudulent coupon. Certainly these aren’t all the signs out there, so use these and your gut intuition as your guide.

  • The coupon sounds "too good to be true."
  • The coupon makes you serious cash (not $0.50 or $1.00, but $5+).
  • The coupon requires you to pay something first before you can redeem it.
  • The coupon comes with fees attached.
  • The coupon involves purchasing coupons (sometimes you can purchase coupons legitimately, but because of fraud it is important to tread cautiously before you commit).
  • The coupon is for sale on an unverifiable website, or via social media.
  • The coupon has no expiration date.
  • The coupon lacks pertinent details (size, quantity, brand name, et al).
  • The coupon looks faded or poorly printed (like it is a photocopy, not an original).
  • The coupon has no verbiage noting that it is "void if sold" (nearly all coupons have this).
  • The coupon came to you in an email chain forwarded from a friend.
  • The coupon is visible on your screen before you go to print it out.
  • The coupon was offered for download via Internet forums.