Even More Real-Life Experiences in Combating Retail Refund Fraud

Keep a close eye on your registers -- in part 2 of this series, we hear how to find and nail internal thefts and scams


The story: It's Saturday night at a large shopping mall, and a group of young men are hanging out on the benches outside a hat store. One by one, or in pairs, they enter the hat store and speak to the same employee. The employee is a young, new part-timer. The store manager has already forbidden this worker to ring on the register because somehow, the drawer is always a bit short when he finishes a shift.

The solution: A bit stumped as to what's going on? So was the manager. The friends of the lad working in the hat store were waiting for their opportunity to get free merchandise, courtesy of the part-timer. The only thing that stopped them on this occasion was the fact that they were under obvious surveillance by a uniformed police officer. The manager had already taken a step toward eliminating the shortage problems in the store by keeping that particular worker away from the cash. However, he needs to confront the employee about who his visitors are.

The advice: Any employee whose register consistently comes up short needs to be reassigned to another job because he's obviously not making any sales for the store. Alternatively, management might decide that his services aren't needed any longer. In any event, a zero-tolerance policy must be implemented.


The story: A national sunglass chain store moves into a large shopping mall. The store has an open-display policy, meaning that the sunwear is not kept locked up, nor is it EAS-tagged. In addition, the store is initially set up camera-free. Within a week, the store is visited by members of an organized theft ring, who pull a daylight version of smash-and-grabs: Three to five of them enter the store, grab $2,000 worth of merchandise at a pop, and skedaddle before the employees can react. This scenario is repeated time and again.

The solution: This company must decide whether the repeated losses are an acceptable cost of doing business. If they're not, then they have to take steps to ensure that the gangs can't steal from them so easily. The manager in this store resisted incorporating video surveillance and refused to change the store layout. When some gang members were caught, they ratted out the manager as being in on the scam.

The advice: Optical goods have a shrinkage rate of over three times the average, or about 7 percent. Sunglasses and eyeglass frames are especially tricky to secure to because customers need to be able to try them on in order to decide to make a purchase. In addition, many popular sunglass styles feature thick plastic temples, and they're hard to tag. Both Sensormatic and Checkpoint Systems offer EAS tags that are especially suitable for eyeglass frames, including benefit-denial tags from Sensormatic. If the store's philosophy is that open displays lead to more sales, then a sufficient number of staff members must be on hand to provide customer service in order to both make sales and to thwart groups of thieves. Surveillance cameras are also necessary so that thieves can be identified once they're caught. And environmental design is important, too, especially keeping registers close to the exits. Of course, performing background checks of all personnel should go without saying.

THE CASE OF THE GANG MEMBERS' GIRLFRIENDS -- help us solve the case!

The story: