The Role of Mystery Shopping in Detecting Fraudulent Activities

Mystery Shopping - Integrity Asia

This publication is authored by and reflected the views and opinion of PT Integrity Indonesia. More information about PT Integrity Indonesia is available on


In today's highly competitive market, businesses constantly seek innovative ways to ensure exceptional service while safeguarding their reputation. One effective strategy is mystery shopping, a practice that offers invaluable insights into service quality and adherence to operational standards. Not only does it serve as a tool for performance evaluation, but it also plays a pivotal role in identifying and mitigating fraudulent activities that can jeopardize a company's financial health and credibility.

As the name suggests, this activity is conducted covertly by trained investigators or mystery shoppers who pose as regular customers. How does mystery shopping uncover fraudulent activities? One approach is through product purchase tests, frequently conducted both online and offline.

Detecting Fraudulent Activities

In the effort to uncover fraudulent activities, product purchase tests often serve as scenarios where companies task mystery shoppers to buy specific items. Through these purchases, companies can evaluate employee behaviour in serving customers, their adherence to Standard Operating Procedures (SOPs), and identify gaps in internal oversight at their outlets. From various indicators, potentially fraudulent activities can be detected.

  1. Direct Observation of Procedures

Mystery shoppers can observe and report whether employees follow the procedures during transactions. For example, SOPs may require cashiers to provide purchase receipts to customers after each transaction.

Hence, it's common to see signs at cashier counters stating "Free, if no receipt". Receipts not only serve as proof of purchase but also offer additional benefits to customers, such as loyalty programs or discounts for future transactions.

  1. Transactions Verification, Discount Monitoring, and Promotions

Mystery shoppers can note transaction details, including amounts paid and change received, then compare this data with the receipt to ensure no discrepancies.

For instance, in a case, a cashier provided a receipt to a customer, but there was a discrepancy between the items purchased and those listed on the receipt, even though the amount paid matched what was stated. Such findings could indicate fraud.

Moreover, mystery shoppers can also check whether discounts and promotions are applied correctly. If employees offer unauthorized discounts or exploit promotions for personal gain, it can be reported as fraudulent behaviour.

Therefore, companies need to conduct further investigations to determine whether these discrepancies were intentional or the result of human error.

  1. Observing Internal Oversight Gaps

Internal control plays an important role in ensuring operational compliance and reducing the potential for fraud. In another case, for instance, at a fast-food outlet, their SOP stipulates that food served must be kept in the food warmer holding cabinet for only a few hours to maintain quality. However, each outlet also has targets to minimize food wastage.

In this case, the findings from mystery shopping revealed that the quality of the food served did not meet expectations. With such findings, the company should initiate a thorough investigation, exploring the potential shortcomings in internal controls at their outlets.

Focus on findings and investigation

Prioritizing findings and investigations are crucial in the ongoing activities of mystery shopping programs.

Findings may not always be directly conclusive evidence, but often the information recorded in reports can serve as valuable clues for companies to conduct further investigations. This allows companies to take appropriate and decisive steps to protect their assets, enhance integrity, and improve service quality for their customers.


Mystery Shopping - Integrity Asia

This publication is authored by and reflected the views and opinion of PT Integrity Indonesia. More information about PT Integrity Indonesia is available on