This marks the final installment in a three-part series on organized retail crime, focusing on the impact of theft on businesses and the response from companies and policymakers. To catch up on the previous stories, you can read the first one here and the second one here.
In Chicago, Illinois, the Magnificent Mile shopping district has been hit hard by a decline in foot traffic due to the pandemic and a wave of robberies and retail thefts. As retailers move out of the luxury shopping district, Walmart’s CEO, Doug McMillon, warns about the potential consequences of not aggressively prosecuting shoplifters. He emphasizes that failure to address this issue could lead to higher prices for consumers and store closures.
The retail industry plays a significant role in the nation’s economy, serving as the largest private sector employer and contributing $3.9 trillion to the annual gross domestic product of the country. The closure of a large store like Walmart not only affects job opportunities but also deprives communities of a convenient place to purchase everyday goods. Lawmakers recognize the importance of this issue and have taken action.
Since 2022, nine states, six of them this year alone, have passed legislation to impose stricter penalties for organized retail crime offenses. Additional bills are currently under consideration in state legislatures and the U.S. Senate. Retailers and trade associations have been instrumental in pushing for these measures, leveraging their collective influence to shape the content and ensure their passage. Lawmakers from both sides of the political spectrum see an opportunity to appear tough on crime, aligning with the current political climate.
The intention behind these new and proposed laws is to deter organized retail crime and target the leaders of these theft groups, often referred to as the “kingpins.” However, critics argue that these measures may not effectively curb organized retail crime and could disproportionately harm marginalized communities. Adrian Hemond, CEO of Grassroots Midwest, a political consulting firm, criticizes the power and influence of interest groups in shaping policy agendas for their own benefit, rather than considering the broader public interest.
Retailers have attributed rising crime rates to increased inventory losses, also known as shrink. However, they have not provided concrete data to back up the extent of the financial impact, nor are they required to do so. Some experts suggest that retailers may exaggerate the impact of theft to divert attention from internal factors contributing to profit losses. With major retailers preparing to report second-quarter results in the coming weeks, more references to retail crime are anticipated.
Legislators have been swift to address the issue of organized retail crime. The Inform Act, which took effect in June, requires online marketplaces like Amazon and eBay to disclose the identities of high-volume sellers to hinder the sale of stolen goods. Despite initial resistance, these digital giants eventually supported the legislation after certain concessions were made. Violations of the Inform Act now carry steep fines.
With the success of the Inform Act, the focus has now shifted to the Combating Organized Retail Crime Act (CORCA), sponsored by Senators Chuck Grassley and Catherine Cortez Masto. The National Retail Federation (NRF), the world’s largest industry trade association, played a role in drafting the bill. CORCA proposes stricter penalties for theft offenses and changes in the threshold for federal theft cases. Currently, federal charges can only be filed if the stolen goods amount to $5,000 or more in a single instance. CORCA seeks to lower the threshold to include cases where the aggregate value of stolen goods reaches $5,000 or more within a 12-month period.
Senator Cortez Masto explains that CORCA aims to provide investigators with more tools to combat organized retail crime and strengthen existing laws. It also calls for the establishment of an Organized Retail Crime Coordination Center, which would facilitate information exchange between retailers and law enforcement. The center would be responsible for tracking trends in organized theft and producing annual reports for Congress. The bill has received bipartisan support and sponsorship in both the House and Senate.
In addition to the federal level, nine states have already enacted similar laws with the assistance of local retail associations. Several other states have pending proposals. These state laws, like CORCA, allow prosecutors to aggregate the total value of stolen goods over a specific time period, enabling them to charge repeat offenders with more severe felonies instead of misdemeanors. For example, Florida’s new law allows the charging of felonies if an individual steals an aggregate amount of goods within 30 days. Moreover, stealing 20 or more items in five or more instances within a 30-day period can result in a second-degree felony charge carrying a maximum sentence of 15 years in jail.
The effectiveness of these new and proposed laws is a subject of debate. While they adopt a strategy similar to combating drug trafficking, focusing on catching the “little fish” first and leading to the larger players, some experts question if this approach will truly reduce organized retail crime. Jake Horowitz, a senior director at The Pew Charitable Trust, points out that the same strategy has had limited success in dismantling the illegal drug trade. The low probability of detection and arrest for individual thefts may not deter boosters, and the replacement of street-level dealers suggests that incapacitation through prison sentences has minimal impact. The organized retail crime market requires a more comprehensive and nuanced approach.
In conclusion, the efforts to combat organized retail crime have gained momentum, with legislation at both the state and federal levels. Retailers and trade associations have played a significant role in shaping these measures. However, the extent to which these laws will effectively tackle organized retail crime remains uncertain, and their potential impact on marginalized communities is a cause for concern. The experiences and lessons from other crime markets, such as the drug trade, should inform future approaches to this complex issue.
Denial of responsibility! VigourTimes is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.
