To Fight Crime Rings, Stores Shrug off Secrecy, Share Information

Organized retail theft increasing in prevalence; but retailers fighting back in earnest


Jun. 18--Minneapolis -- An industry that guards its secrets carefully is making an exception when it comes to shoplifting. Retailers have been hit hard this year by organized rings of thieves, and they're fighting back by talking about it.

"It's killing us," said Stan Berger, regional loss prevention manager for Stage Stores in Houston.

During a lunch break at a National Retail Federation meeting this month, Berger was swapping phone numbers with loss prevention managers from other companies. By sharing information, people charged with nabbing retail crooks are hoping to stop the big operators who are costing the industry billions.

"Organized retail crime is definitely the hot topic in retail crime prevention," Berger said.

Last year, retailers in the United States lost about $37.4 billion worth of merchandise, with about 80% of that stolen by shoplifters or employees. That amounts to 1.6% of the $2.3 trillion worth of goods sold.

Some of the merchandise that disappeared was taken by traditional shoplifters: thrill-seeking teenagers or people who just want a free sweater. But huge amounts were removed from stores by professional shoplifters, known as "boosters" in the industry, who make a career of stealing and turning over the goods to bosses who sell to someone else, known as "fences." The merchandise then goes to black market stores, flea markets or to online auction sites.

Organized crime is a big topic for loss prevention managers at Green Bay-based ShopKo.

"It has escalated in the past year, primarily in our larger markets," said John Vigeland, spokesman for the discount chain. A ring operating in Salt Lake City has been stealing baby formula and health and beauty products, such as shaving items, Vigeland said. The products are going over the border to Mexico for resale, he said.

ShopKo has been sharing information with other retailers in Salt Lake City that have been hit by the theft ring, and it is planning to get involved in a national database, Vigeland said. ShopKo also has increased video camera surveillance in its stores.

"In the past, ShopKo has been reluctant about sharing information," Vigeland said. "Now (organized crime) is picking up enough steam that we have to get involved."

Widespread problem

Bon-Ton Stores Inc., which operates the Boston Store and Younkers chains in Wisconsin, is represented on the National Retail Federation's advisory board for loss prevention and is participating in the intelligence network.

"All of retail faces this," said Mary Kerr, spokeswoman for Bon-Ton.

The federation honored a Portland, Ore., FBI agent, Christopher Frazier, at the Minneapolis loss prevention conference for his role in bringing down a retail crime ring that operated for years in the Pacific Northwest. The four-year undercover operation that Frazier oversaw resulted in indictments against 91 people and the recovery of $7 million in merchandise and $1 million in cash.

After being approached by the loss prevention executive for Safeway Inc., Frazier agreed to take the case, despite enduring teasing from fellow agents who viewed it as shoplifting, which is not something that most law enforcement officers see as an important crime. Safeway and other retailers in Portland were targets for thieves who took health and beauty products, cigarettes, DVDs, over-the-counter drugs and other small items that were fenced to illegitimate wholesalers in the region.

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