Security & Fraud

The Rise Of Organized — And Disorganized — Crime In Physical Retail

shoplifter

They say the perfect crime is hard to commit, but last week in Spokane, Washington an intrepid burglar managed to pull it off at the Yuppy Puppy pet store, according to local law enforcement officials. The burglar, according to surveillance video, managed to break into the shop, scoop the cash out of the register and flee the scene, all in under 35 seconds.

More impressive, according to shop owner Aquila Brown, the burglar managed to avoid ever directly looking at the security cameras, and managed to locate the cash register instantly, despite the fact that it had been recently relocated in the shop. Brown rejected suggestions that it could be a current or past employee, telling local news affiliates, “It was a pro.”

What makes the story stand out among the reams of local retail crime reporting is that the crime was actually committed. Botched crimes in local retail are common. In Colorado last week, police managed to arrest the same man for three attempted car thefts — two of which happened on the same night on the same block. He was arrested when police came upon him attempting to break into a truck and he verbally confirmed he was in the middle of trying to steal it. Upon being arrested for his third failed try, the alleged would-be car thief, Todd Sheldon, was forced to concede this may not be his calling.

“I really suck at this,” he told a deputy, the sheriff’s office said, according to Newsweek reports.

And he wasn’t the only thief with a talent issue. In California, a local caricature artist had a client sit down, commission a caricature, rob him of $500 and then run off. He left the caricature behind, because if one is going to rob someone, best to sit for a portrait first.

But the Yuppy Puppy thief, unlike his fellows in the world of brick-and-mortar retail crime that made local news this week, apparently thought the crime through, made a plan and executed it well. But considering they only made off with the $200 that was in the register, as the pet store is small, it does beg a different question entirely.

Why? It would be easier, more lucrative and carry no risk of jail time to download the Uber app and drive for a weekend. Even the Yuppy Puppy’s owner couldn’t make sense of it.

“He had clearly staked the place out. That’s crazy. We’re just a little pet store. Why would you waste your time?” Brown wondered, noting this is why she is fairly certain an employee isn’t to blame — as they would know there isn’t enough cash in the register to justify the effort.

As it turns out, not every criminal is a mastermind, and even those with a talent for crimes like burglary may lack the kind of long-term planning skills necessary to really make a successful go of it. The Spokane pet store robber is still at large, incidentally, and given that crime was about a week ago, the burglar may well be casing another micro-business for their next big three-digit score.

But while it is easy to mock small-time criminals pulling off inexplicably well-executed small-time burglaries, the rise of theft in the world of physical retail is no laughing matter. Cybercriminals and their consistently advancing efforts to make off with and illegally profit from pilfered consumer data get all kinds of press — but not every criminal organization targeting retailers is doing it from behind a computer screen and trolling for ill-gotten data.  An increasing number over the last few years have boots on the ground, so to speak, and are targeting physical goods — in stores, at delivery centers and en route between the two locations.

Organized Crime’s Physical Retail Expansion 

And we do mean criminal organizations — according to a late 2019 NRF report almost two-thirds of brick-and-mortar retailers have seen an increase in organized crime activity in their locations in the form of shoplifting gangs that work in tandem to pick the shelves of inventory. That figure comes on top of a finding that 97 percent of retailers had been victimized by ORC (organized retail crime) in the past year with losses averaging $703,320 per $1 billion in sales.

“Organized retail crime continues to present a serious challenge to the retail industry,” NRF Vice President of Loss Prevention Bob Moraca said. “These criminal gangs are sophisticated.”

And wide-ranging in the items they target — though the goods tend to gravitate toward one of two areas. The first is high-priced luxury consumer goods, particularly designer clothing and accessories, fine jewelry and high-end liquor products. The other is everyday consumer goods — baby formula, razors, energy drinks, laundry detergent and allergy medicine are all especially favored by ORC gangs, according to the report.

So when you are out on your weekly grocery run, bear in mind that you may in fact be surrounded by agents of organized crime on a mission to steal all the Tide Pods, Enfamil and Monster Energy drinks they can.

We’re just saying, watch who you accidentally bump into with your cart.

And while that is mostly a joke, retailers say their concern about the increased organized criminal presence in their stores over the last few years is the safety of their customers and employees, as some 68 percent of retailers reported that ORC gangs have shown a slightly greater tendency toward aggression, according to the NRF.

Solving the Problem 

Obviously organized crime showing up in a store with a mass of operatives to pick over the shelves is something no retailer wants — and according to the NRF’s Moraca, it is something retailers have been increasingly leveling up their game to rout out.

The gangs are more sophisticated, he noted, “but so are retail loss prevention teams. Retailers are committing more resources and constantly evolving their tactics to fight this ongoing challenge.”

But the era of eCommerce has made fighting these crimes more difficult, as it has made it easier to monetize ill-gotten gains. Resale at a deep discount, particularly for those necessity items, is markedly more easy by access to online marketplaces, especially those with lax vetting process for merchants. Retailers, according to the NRF, have also seen an uptick in a variation on that tactic, where ORC gangs will first steal merchandise from stores, return it to the store for a gift card and then resell the gift card via an online gift card marketplace. Among retailers surveyed, 51 percent said they had found their card on online gift card marketplaces, while 17 percent reported finding them in pawn shops.

The good news is that retailers are more keyed in to the concern than they’ve been of late — two-thirds report that battling back organized crime in their retail locations is a greater priority than it was five years ago, 55 percent reported plans to allocate additional technology resources to the issue and  38 percent reported plans to change policies around returns. Additionally, 37 plan to change point-of-sale policies.

Will it be enough to repel the organized crime gangs that have been targeting retailers as an excellent supply of easily monetizable free inventory for the last half decade? Well, if the world of cybercrime offers any parallel, probably not. The thing about organized criminal gangs is that they are persistent and almost impossible to be entirely rid of — since they tend to escalate in tandem with efforts to prevent them.

But then again, as Todd Sheldon’s failed attempt at a crime spree in Colorado demonstrated this week, persistence and talent are not necessarily the same thing. And for every clever thief out there who successfully skirts the system, there are quite a few less clever ones willing to greatly overthink a $200 robbery or leave a sketch of themselves behind after robbing the artist.

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