The Chicago Syndicate: 85% of Retailers Have Been Hit by Organized Crime in the Past Year

Friday, June 13, 2008

85% of Retailers Have Been Hit by Organized Crime in the Past Year

With growing numbers of retailers falling prey to organized crime rings, the businesses are fighting back by increasing detection and dismantling these groups, according to a survey by the National Retail Federation.

On Wednesday, the NRF released its 2008 Organized Retail Crime report, finding that 68 percent of retailers nationwide reported having identified or recovered stolen merchandise and/or gift cards from a fence location. That's up from 61 percent in 2007.

Movement of stolen merchandise is increasingly occurring online, being sold through third-party auction sites, according to the NRF report, making it easier for crime rings to maintain anonymity. It also found that 85 percent of retailers said they had been victimized by organized crime over the past year, which is up from 79 percent in 2007.

"Law enforcement and retailers alike are fed up with organized retail crime rings and are stepping up efforts to stop them in their tracks," Joseph LaRocca, NRF vice president of loss prevention, said in a statement. "The brazen and unethical behavior of organized retail crime suspects results in possible health risks for consumers, adds unnecessary fees to consumers' purchases and funds criminal enterprises, including the mob and terrorist organizations around the world."

LaRocca said organized retail crime continues to proliferate as retailers that have not been traditional targets are increasingly being victimized.

"Retailers who have been affected by organized retail crime for several years may not be seeing increases, but the problem continues to grow as more retailers are being impacted," he said.

The NRF survey also found that the average retailer is now spending $230,000 a year on labor costs to combat organized retail crime, although some spend far higher amounts. According to the Federal Bureau of Investigation, organized retail crime accounts for as much as $30 billion in retail losses every year in the United States.

The NRF, based in Washington, D.C., is the world's largest trade association, representing 1.6 million U.S. retail businesses.

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