Loss Prevention

Employee Theft on the rise

Paul Jones — Sun, 20 Dec 2009 19:19:45 +0000

During these tough economic times, it is reasonable to believe that our associates have more temptation or need than they may have had in prior years. I often thought that the tough economic times would result in fewer temporary employees being hired for seasonal duties, thus less employee theft than in prior years.

This is an interesting article from LP Magazine.

As Economy Falters, Employee Theft On the Rise
In the past 18 months Frimet has seen a 25 percent increase in clients asking him to investigate employee embezzlement. Metro Police detectives in the department’s fraud detail are also seeing an uptick in cases, but don’t necessarily see it as an indication the crime is on the rise. Las Vegas Sun

Tis the Season

Paul Jones — Tue, 15 Dec 2009 20:47:22 +0000

Interesting Xmass theft story

http://www2.tbo.com/content/2009/dec/03/tampa-police-arrest-woman-business-refund-scam/

Pete Collazo’s Passing-

Paul Jones — Mon, 07 Dec 2009 23:12:19 +0000

I learned yesterday that my friend and fellow Loss Prevention colleague Pete Collazo passed away. Pete was based in Dallas and for the last decade ran a successful private investigation business. Pete suffered with an illness for the last few years and he was an example to all of us to push forward and bring your A game each and every day.

I had the pleasure to meet with Pete about 15 years ago (I feel old), when he trained me at Mervyn’s as a DLPM. He was a generous soul that embodied everything that is great about the great state of Texas. Pete was an acquired taste, (as I am) for some as he had a point of view and shared it at times even when you didn’t want to hear it. He was a caring kind person that was loyal to his friends, profession and his family.

Pete had some great experience form Texas Law Enforcement agencies (Texas Ranger I believe), where he was an undercover drug agent and had several near death experiences. Pete was also one of the many Montgomery Ward Alumni that helped our industry grow and developers the leaders of today.

Besides enduring much pain from his illness, Pete had the awful experience of burying one of his sons who was the victim of a murder. Pete was an example of someone who would perservere and bring his A game. After his sons passing, Pete continued to focus on family and today shares a great relationship with his family. I recall how enthusiastically he would share stories about his grandkids.

Pete was probably one of the best investigators you could work with and he trained many AAA Loss Prevention executives who have gone on to lead this industry.

Pete was a Dad, Grand Dad, LP Executive, Private Investigator, Husband, and a friend.

I will miss you my friend, I hope all of your pain is gone.

The funeral arrangements for Pete are as follows:

Visitation will be Tuesday, December 8, 2009, 6:00pm -8:00pm

Funeral will be on Wednesday, December 9, 2009, 3:30 pm

Moore Memorial Gardens
1219 North Davis Drive
Arlington, TX 76012
USA

817-275-2711 817-275-2711 817-275-2711 817-275-2711

Paul

King Rogers- article from Rila Report

Paul Jones — Thu, 03 Dec 2009 16:38:56 +0000

Rila has continued on the path of bringing valuable LP thoughts to today’s Loss Prevention leaders. This month’s report is out and I found this article by King to be a great read and would be good advice for anyone building or designing their Loss Prevention function.

The LP Organization: Form Follows Function

Volume 3, Issue 5 – 11/9/2009

Over the last three plus decades of commitment to the retail loss prevention industry, I have seen many forms of loss prevention organization structures. Just like retailers’ approach to retail, one size doesn’t fit all in loss prevention. Specialty stores might require a certain type of organization structure and big box retailers might require a totally different organization design. The structure of the LP organization can be different though equally effective in different specialty store chains. And the same is true in the big box industry. But there are several organization design tenets which are consistent (or should be) throughout the industry.

The LP Organization: Form Follows FunctionVolume 3, Issue 5 – 11/9/2009Over the last three plus decades of commitment to the retail loss prevention industry, I have seen many forms of loss prevention organization structures. Just like retailers’ approach to retail, one size doesn’t fit all in loss prevention. Specialty stores might require a certain type of organization structure and big box retailers might require a totally different organization design. The structure of the LP organization can be different though equally effective in different specialty store chains. And the same is true in the big box industry. But there are several organization design tenets which are consistent (or should be) throughout the industry.

http://echo4.bluehornet.com/hostedemail/email.htm?h=cc230dffbaa385c1cb81194fbae5bd8a&CID=7124366132&ch=3F823ABA05AB6E33C97EAD56A2FD87F0

Using data is critical in making your Loss Prevention decisions

Paul Jones — Fri, 27 Nov 2009 18:29:45 +0000

In a world with constricting budgets and increasing crime, approaching your risks utilizing analytics is critical to building your Loss Prevention program. Providing enhanced measure where they matter the most is possible.

From LP Magazine

Loss prevention analytics tailored to optimize your business performance. CAP Index is now offering loss prevention analytics to help reduce losses. Applying sophisticated techniques to a broad array of data, CAP Index builds customized risk models that help clients optimize their business performance. For more information click www.CAPIndex.com/LPM.

eBay + LeadsOnline help Law Enforcement everyday

Paul Jones — Mon, 16 Nov 2009 19:19:51 +0000

eBay USES ONLINE DATABASE TO CONNECT WITH POLICE TO KEEP STOLEN ITEMS OFF THE POPULAR WEBSITE. LeadsOnline, the Nation’s largest online investigation tool, is the link between eBay and law enforcement that helps keep stolen property off the virtual shelves. Dallas, Nov. 11, 2009 – eBay is committed to keeping stolen items from being posted and sold on their popular site. The world’s largest online marketplace uses LeadsOnline, the nation’s largest online investigative tool, to help keep their site free of stolen property that has been listed for sale or sold on eBay. The First Responder Service through LeadsOnline is available to police 24 hours a day and provides search results within seconds. The online system can locate seller ID information for property listed on eBay and locate seller listings and sales history for property listed on eBay. “LeadsOnline is a strong and important connection to law enforcement for eBay,” says Paul Jones, director of retail partnerships with eBay. “This also helps us combat any other business and stolen goods issues that arise in the marketplace.” LeadsOnline has been an official partner of eBay’s for the past four years. In addition to helping police find and recover stolen property posted on eBay, the LeadsOnline system is invaluable in helping break up larger crime rings where high-value bulk items are stolen and sold on the site. Because the system allows police to search eBay in a variety of ways, from names to seller history to serial numbers and item descriptions, stolen items are quickly uncovered. “LeadsOnline is committed to helping eBay ensure a safe buying and selling environment for their millions of online customers,” says Dave Finley, president and CEO of LeadsOnline. Law enforcement agencies from across the country use LeadsOnline to search eBay for stolen property and report many successes. Listed here are just a few of the many stories of success from detectives who use LeadsOnline and eBay to solve cases: Police in Maryland recovered a stolen $3,000 Cartier watch. The watch had not even been reported stolen yet when the police recovered it on an unrelated search warrant for drugs. Police found the watch on LeadsOnline web site in about ten minutes and had all the information they needed to go forward with charges. A large corporation in Daytona Beach, Florida, reported the theft of eight new laptop computers from an IT storage area. Police were able to determine the seller’s name, who just happened to be the brother of a former employee who had knowledge and access to the storage facility where the theft occurred. An elaborate sting using the US Postal inspectors, a local eBay sales store, and the police was set up. The police purchased the computer on eBay and had it delivered to an undercover operative in California who delivered it to the Daytona Beach PD. After some search warrants and hours of questioning police obtained warrants for the arrest of the former employee and the eBay seller. Police recovered four of the stolen computers and two others that the company didn’t even know were stolen. Police in Summit County, Colorado received a tip about a $3000 mountain bike for sale on eBay. The bike was stolen along with another $2700 bike from a motor vehicle. LeadsOnline allowed police to quickly obtain a name for the seller, which led to a windfall of information. Police made three arrests and recovered $25,000 in stolen property. Police credit LeadsOnline for providing the very first lead in the case. Police in California received second-hand information related to stolen merchandise being offered on eBay by a seller in a neighboring city. After review police confirmed the merchandise (clothing) appeared to be stolen. Using LeadsOnline police not only identified the seller but found approx $42,000 worth of prior sales of the same clothing during the previous 90 days. Police immediately secured a search warrant and after service of the warrant an additional $25,000 of clothing and cash was recovered. In one day, police in Grinnell, Iowa used LeadsOnline to find information about a suspicious seller, obtain a search warrant, and recover $20,000 of stolen property, and make an arrest. LeadsOnline is the nation’s largest online investigative system used by more than 3,000 law enforcement agencies to recover stolen property and solve crimes. Each day, millions of items are added to the LeadsOnline database by businesses including second-hand stores, scrap metal recyclers, pawnshops, and Internet drop-off stores across all 50 states. Those records are instantly available to law enforcement agencies, meaning crimes can be solved in seconds, not months. The LeadsOnline system, compatible with the NCIC, serves as an indispensible, efficient, and money-saving resource for detectives because it provides a cross-jurisdictional, instantaneous, and accurate database that stops criminals from escaping detection by selling stolen items in another city. An official eBay partner, LeadsOnline helps prevent illegal transactions on the eBay website by giving law enforcement access to the world’s largest online marketplace through automatic upload of all eBay transactions into the LeadsOnline database. LeadsOnline also includes LeadsOnlabs, a system for tracking those involved in the illegal manufacture of methamphetamines; a Metal Theft Investigation System designed to track copper and other metal thefts; and cross-checks names of pawn customers against the OFAC SDN list of known terrorists and narcotics traffickers. Each year, LeadsOnline is credited with recovering millions of dollars in stolen goods and solving thousands of crimes that are often associated with bigger crimes, such as homicide, identity theft, and arson. Based in Dallas and led by President and CEO Dave Finley, LeadsOnline works with thousands of agencies throughout the country, including the New York Police Department, the Dallas Police Department, and the San Francisco Police Department. www.leadsonline.com

New report- Retail fraud study

Paul Jones — Wed, 11 Nov 2009 01:13:46 +0000

Interesting retail report on fraud.

U.S. Retailers Face $191 Billion in Fraud Losses Each Year

Nov 09 2009

LexisNexis True Cost of Fraud Study Reveals that Retail Merchants Experience 20 Times Higher Total Fraud Losses than Consumers

New York, NY – U.S. merchants are incurring $191 billion in fraud losses each year, according to a new report released today by LexisNexis® Risk Solutions. Among the findings, the 2009 LexisNexis® True Cost of Fraud Benchmark Study discovered that merchants must absorb nearly 10 times the identity fraud cost incurred by financial institutions. Retail merchants experience a massive $100 billion in losses solely attributed to identity fraud, which escalates to $191 billion when factoring in the additional cost of lost and stolen merchandise. The study also found that merchant fraud losses amounted to more than 20 times the total value of consumer fraud victim losses which totaled approximately $4.8 billion in 2008.

Developed in conjunction with Javelin Strategy & Research, the study examines how U.S. retail fraud affects merchants, financial institutions and consumers. The full study is available on the LexisNexis® Risk Solutions Web site at: risk.lexisnexis.com.

http://risk.lexisnexis.com/Article.aspx?id=58

Congressional Hearing – Resources and Partnerships Highlighted

Paul Jones — Fri, 06 Nov 2009 19:44:52 +0000

This is from the Bureau of National Affairs, and outlines their thoughts from yesterdays congressional hearing on ORC. I was pleased that the issues of resources and productive partnerships were highlighted.

Agents Say Resources, Not New Rules Key to Combating Fencing on Websites

Federal law enforcement agents told the House Judiciary Subcommittee on Crime, Terrorism, and Homeland Security Nov. 5 that online services are cooperating with their efforts to combat online sales of stolen property by organized crime groups, and that they do not need new procedural authority to ensure compliance with requests for information in connection with their investigations.

The National Retail Federation has estimated that organized retail crime and the sale of stolen products online, otherwise known as “e-fencing,” costs companies billions annually and also deprives states of considerable tax revenues.

Three bills introduced in early 2009 as part of an effort to target the offense (S. 470, H.R. 1173, and H.R. 1166) would create record-keeping and fraud investigation rules for online services that enable users to sell products. Companies like eBay have complained they unfairly single out online businesses and invade legitimate online sellers’ privacy rights.

Rep. Lamar Smith (R-Texas) and Rep. Robert Goodlatte (R-Va.) introduced a fourth bill targeting organized retail crime Nov. 3 (H.R. 4011). The proposal would target transferors, sellers, and other participants in online sales of stolen products, but would not codify new requirements for online services.

“We need to make sure that legitimate online businesses like eBay and craigslist and a whole host of other online businesses are accommodated in the sense that we need to find ways that they can cooperate with law enforcement without having legislative requirements that are too intrusive in terms of their business model,” Goodlatte said.

Law Enforcement Praises Service Cooperation

“Organized retail crime is a huge and growing problem,” Goodlatte said. Not only are companies incurring substantial losses from stolen products, but in many cases the proceeds are being used to fund other criminal and terrorist activities, he said.

Agents from the Federal Bureau of Investigation, U.S. Immigration and Customs Enforcement, the U.S. Secret Service, and U.S. Postal Inspection Service told the subcommittee that online services are cooperating with law enforcement efforts, and that federal agencies do not need additional procedural authority to obtain information from them.

“Do you have enough authority under present criminal law procedure to open an investigation and proceed?” Rep. Robert Scott (D-Va.) chairman of the subcommittee, asked. “Do you need any new laws on the books from a procedural perspective to investigate?”

David J. Johnson, section chief of the FBI’s violent crime section of its criminal investigation division, answering on behalf of himself and not the FBI, said “the existing laws on the books, whether it’s Title 18 U.S.C. §§ 2314, 2315, or the conspiracy statutes or the money laundering statutes or even the RICO statute provide adequate criminal remedies.”

“Based on my limited interaction with auction sites, they have been cooperative with the FBI and have given us the assistance we have requested,” Johnson said. “The level of cooperation between state and federal law enforcement and the private sector has been outstanding.”

Janice Ayala, deputy assistant director of ICE’s office of investigations, said that online services like eBay have systems in place to monitor their services for sales of stolen products, and are working closely with federal and state law enforcement to address the issue.

John R. Large, special agent in charge of the Secret Service’s criminal investigations division, said that online services have also worked with his agency to successfully investigate and prosecute several organized cybercrime groups.

“So it seems like criminal laws are enough, the procedures are enough, the problem seems to be resources. So if we want to do something, we need to get you the resources,” Scott responded.

Four Pending E-Fencing Bills

As part of an effort to address e-fencing, lawmakers introduced three bills in early 2009.

Sen. Richard Durbin’s (D-Ill.) S. 470 would require online services to investigate reports of stolen product sales, suspend sellers who are engaged in suspicious activities, and keep records of all complaints and reports for three years.

Online services would also be required to collect and retain information about “high volume sellers,” The bill would expose services to civil penalties for failure to comply with those requirements, and criminal penalties for knowing violations.

Scott’s H.R. 1166 would require online services to disclose contact information for high-volume sellers to parties who have reported stolen products to law enforcement. It would also place a duty on services to determine whether their users’ sales are lawful, and impose criminal penalties for services that knowingly participate in the sale of stolen products by providing an internet marketplace.

H.R. 1173, introduced by Rep. Brad Ellsworth (D-Ind.), would prohibit “facilitation of organized retail crime,” and require online services to remove sales of suspected stolen products when presented with credible evidence.

Services would also be required to maintain a record of those investigations and information about high-volume sellers for three years. The bill provides that any property used, in any manner or part, to facilitate organized retail crime would be subject to civil forfeiture, and would create a civil cause of action against any operator of a Web marketplace for damages and injunctive relief.

The fourth bill does not have requirements for online services. H.R. 4011, would establish criminal penalties for the transport, transmission, or transfer in interstate or foreign commerce any goods, wares, or merchandise worth more than $1,000, for sale online, knowing they were stolen. It would also criminalize the bartering or selling of stolen merchandise worth at least $1,000, knowing the products are stolen, converted, or taken by fraud; and establish a multi-jurisdictional task force to initiate investigations of organized retail theft

This is my personal blog and does not represent the views of my current, past or future employers..

Wrestling & Business- Lessons to be learned

Paul Jones — Thu, 05 Nov 2009 01:58:11 +0000

A friend sent this article to me this week, which highlights some lessons main stream businesses can learn from WWE the wrestling franchise.

From Fast Company Magazine

http://www.fastcompany.com/blog/sam-ford/conversation-convergence/10-things-corporations-can-learn-pro-wrestling

eBay + retailers nail bad actors

Paul Jones — Fri, 30 Oct 2009 17:59:51 +0000

Much work has been done over the last year on stolen goods in retail. In my new role at eBay I lead a team of professionals who are pioneering new ground and are working collaboratively with their retail partners.

Here is a small example highlighted by my colleagues at Rila.

Top Stories:
Police Make Arrest in Diabetic Test Strips Thefts
Arizona – A joint sting operation known as “Operation Interceptor” has nabbed a suspect involved in selling stolen diabetic test strips. During the operation, the suspect bought 30 boxes of test strips with a value of $2,254 for only $215 on five different occasions.