That doesn't make anything criminal or fraud any more than free samples. If a registrar wants to give a refund, I don't see anything wrong with that.
It is certainly fraud to take an entire pile of free samples. Domain tasting is more like buying a plasma TV to watch the big game and then returning it to the store on Monday. However, when it's as blatant and obvious as it is now (more tasted domains than legitimate registrations), and no policies are made to stop it despite it being so easy to do so (simply limit the number of refunded domains to 10% of registrations or charge a 20 cent fee for refunded domains), you can argue that it's now an understood and accepted practice. It's not fraud if both parties know it's going to happen, can easily act to stop it, and neither one chooses to. DS