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The top 10 cities for organized retail crime

BY HBSDEALER Staff

Organized retail crime may have decreased very slightly last year, according to a new National Retail Federation study, but it remains a massive problem and the nation’s largest cities are especially prone to organized activities.

NRF’s ninth annual Organized Retail Crime (ORC) Survey found that 93.5% of retailers said they had been a victimized by organized retail crime during the past year, down slightly from 96% the prior year. For the past three years, more than 90% of the retailers surveyed said they were victims of ORC. Eight in 10 of those surveyed believe that ORC activity in general in the United States has increased over the past three years.

"We are extremely concerned by the organized patterns that are taking place in the retail industry right now as these crime gangs continue to find ways to maneuver the system," said NRF vp of loss prevention Rich Mellor. "Though retailers continue to make great strides in their fight against organized retail crime, savvy, unconscionable criminals are selling stolen merchandise for a profit that doesn’t belong to them." 

According to the study, which included participation from 77 loss prevention executives representing all retail channels, the 10 cities with the worst organized retail crime are, in alphabetical order:

  • Atlanta
  • Baltimore
  • Chicago
  • Dallas
  • Houston
  • Los Angeles
  • Miami
  • New York
  • Northern New Jersey
  • San Francisco/Oakland

The list basically mirrors the nation’s 10 largest urban areas which is not surprising considering high concentrations of people and convenient store locations equal increased opportunity for thieves and more outlets for stolen goods.

In other findings, the survey noted troubling developments on the store merchandise credit and gift card front. Nearly 80% of those surveyed said they had experienced a situation where thieves returned stolen merchandise without a receipt for the sole purpose of receiving store credit via a gift card to sell for cash to secondary markets that include kiosks, pawn shops and check cashing stores. 

"This is an important crime to keep an eye on, as this could easily turn from being an organized tactic to one that amateurs could adopt," Mellor said. "In conversations with retailers and law enforcement, we’ve learned that there are already defrauding processes being put in place, but retailers continue to lose millions of dollars to this enterprise scheme."

One of the most distressing trends in organized crime activity, according to NRF, is the propensity for thieves to resort to violence to avoid being apprehended, putting store personnel, law enforcement and customers at risk. According to the survey, retailers said on average two in 10 (18.3%) apprehensions lead to some level of violence, up from 15.2% last year and 13% the prior year.

Individuals connected to "gateway crimes," or crimes that are known to lead to bigger crimes, such as the use of or sale of drugs and weapons, are often found to be associated with organized crime gangs. According to the survey, retailers say on average 44.8% of those apprehended for ORC are involved in gateway crimes.

Retailers and law enforcement officials are working more closely together than ever before to derail ORC activity, according to the retail trade group, but winning the battle will require change at the federal level.

For example, the survey showed that nearly half of those surveyed believe law enforcement understands the complexity and severity of ORC, up from 40% last year and the highest percent reported in the five years since NRF began asking the question. And, nearly 60% said they believe top management at their organizations understands the severity of ORC, also an all time high. 

However, increased awareness by law enforcement and senior management and close working relationships with industry peers only go so far because ORC crosses multiple jurisdictions. NRF contends ORC must be addressed through federal legislation by amending the Federal Criminal Code to more effectively deal with the organized and serious nature of the issue and implement appropriate sentencing guidelines for those convicted.

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A good day for the stocks

BY HBSDEALER Staff

Stocks continued trending upward Tuesday, with the initial enthusiasm dampening for Orchard Supply’s acquisition deal — to the tune of -18.01%.

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EPA proposes new standards for composite wood products

BY HBSDealer Staff

The U.S. Environmental Protection Agency proposed two new regulations last month that would help further protect Americans from formaldehyde emissions in composite wood products. The proposals are currently up for public discussion in the Federal Register, where woodworking professionals and other interested parties can submit formal comments through Aug. 9.

The legislation would apply to all composite wood products that are sold, manufactured, supplied, offered for sale or imported into the United States.

The first rule would place a limit on formaldehyde emissions for hardwood plywood, medium-density fiberboard, particleboard and finished goods. The second rule would call for a third-party certification system that would verify manufacturers’ compliance with the Toxic Substances Control Act formaldehyde emission standards.

According to the EPA, health effects resulting from formaldehyde exposure include irritation of the nose, throat and eyes, respiratory complications, worsening of asthma symptoms, fatigue, headache, nausea and possibly cancer.

Those wishing to submit commentary to the EPA can do so here and here.

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