Ram raids, smash-and-grabs, robberies at gunpoint - any retailer in the world right now can attest to the increase in these crimes and the damage they do to their businesses.

ORC (Organized Retail Crime) is a billion-dollar problem that hurts people, damages profits, and demoralizes communities. It feeds into the web of other types of illegal activities, helping fund serious crimes all over the world.

So why does it keep happening, and what needs to be done about it? In this post, we’ll explore the reasons behind the rise in ORC , its destructive impact, and what needs to be done by who to solve the problem. 

What is ORC theft?

There are as many definitions of what ORC is as there are AP/LP practitioners in the world. This is because different organizations have their own distinct ORC challenges and therefore, come up with definitions based on their most pressing needs.

However, thanks to the Loss Prevention Research Council (LPRC), there is a definition that reveals common themes and differentiates ORC from other types of retail crime. In 2021, the LPRC conducted a survey on 116 AP/LP professionals and asked them to define ORC. Based on the varying responses, the LPRC came up with the following definition:

Organized retail crimes are:

  1. Predatory crimes in which 
  2. one or more offenders 
  3. knowingly and intentionally 
  4. plan or coordinate criminal activities 
  5. on one or more occasions 
  6. with the intent of financially profiting themselves, a group, or a broader criminal enterprise with which they are associated 
  7. through the acquisition of cash, other financial instruments, or merchandise that can be resold, returned, exchanged, or otherwise used to generate a profit.

There are a few key themes here. Firstly, ORC hinges on the crucial word: “organized.” It’s what differentiates these types of offenses from haphazard shoplifting attempts. Instead, they are sophisticated, coordinated, and targeted retail theft events.

Another crucial element is that ORC is done for financial gain. A bored teenager who decides to try and steal some headphones from an electronics store for fun one time is one thing. But someone who routinely steals items from retailers to resell on an online marketplace for profit is something quite different.

While each organization might define ORC based on the lens through which they’re experiencing crimes in their stores, there is a coordinated, repeat and profit-driven element that is common no matter the specific crime. 

The proliferation of ORC theft and its impact

According to the National Retail Federation (NRF), ORC has risen 60% since 2015 and almost 70% of retailers reported an increase in ORC in 2021. Many retailers can point to troves of anecdotes reflecting the rise in more coordinated and brazen crimes happening in their stores.

So why have we been seeing an uptick in ORC in recent years? And what have been the consequences of that?

Online marketplaces 

According to industry experts, online marketplaces like eBay, Amazon, Facebook Marketplace, and so on – and the lack of comprehensive legislation surrounding them – play a huge role in the growth of ORC . People can steal items and sell them online without needing to verify the authenticity of the products. They can hide behind fake profiles and made-up businesses, avoiding all accountability. It’s become an extremely easy and profitable way to make money for the people behind ORC.

The global pandemic

COVID-19 has played a huge, multi-faceted part in spurring on the proliferation of ORC too. The spread of the pandemic pushed customers to shop online, making online marketplaces more popular than ever and leading to more business for ORC perpetrators.

Retail and AP/LP teams also found themselves facing serious staff shortages as more people fell ill and/or followed government mandates. If retailers struggled before the pandemic to launch comprehensive ORC investigations due to a lack of resources, then there was no way they could do it in the middle of a global pandemic. 

Empty shelves, supply chain disruption, and an unpleasant shopping experience are some of the impacts retailers are seeing as a result. All of this places a heavy mental and emotional toll on retail staff, who take on all the responsibility of facing unhappy customers and putting up with ORC perpetrators.

AP/LP teams ill-equipped to deal with ORC

A third major factor is that retailers have struggled to keep up with people who commit ORC because they’re not equipped with the right tools. Many are working with legacy case management systems – or often just a spreadsheet or notebook – which they use to record information about crime events. Nothing is ever done about the events and oftentimes, it takes too long to record every single incident, so teams just don’t record them.

This way, they’re not able to establish links between different people who offend. They also can’t efficiently collect evidence that can be used to identify and prosecute people, or share information both within their own network of stores and with other retailers to prevent crimes before they can happen. In short, many AP/LP teams are always several steps behind the people committing the crimes.

The consequences of this can be deadly. Teams are putting themselves in danger each time they try to stop or approach people offending in their stores. According to D&D Daily’s 2021 Retail Violent Fatalities Report, fatalities in the US retail sector were up 59% over the last six years. Most of these fatalities happened during robberies, burglaries or thefts, with the overwhelming majority (93%) being from gun violence.

With the right information and tools, team members are able to decide how to deal with persons of interest based on previous incidents. This protects both staff and customers from any potentially violent situations.

Getting the right level of support from law enforcement

While progress has been made in getting law enforcement and prosecutors to take ORC seriously, there are still significant hurdles in place.

Reforms aimed at reducing mass incarceration and racism in the justice system have unintentionally encouraged retail crimes. One example is a protection against prosecution in certain situations, including if a person steals below a certain amount. In many states, aggregation of thefts doesn’t count, which allows people to get away with stealing items of lower value multiple times.

Additionally, reform-minded district attorneys have stated they won’t prosecute people for non-violent crimes and misdemeanors as they believe it’s often not in the best interests of public safety to charge these crimes. For similar reasons, more states have raised felony thresholds, and people convicted of non-violent offenses have been released.

Since standalone non-violent retail crime events aren’t prioritized, police don’t send officers to retailers unless violence is involved or a felony threshold is met. Police, too, struggle with resourcing, time, and the frustrations of working within the current legislative framework.

All of this impacts retailers that are struggling to keep those committing retail crimes at bay without sufficient penalties in place. It also discourages AP/LP teams from reporting events because many feel it’s a waste of time and that nothing will be done about it anyway.

On top of this, the lack of legal recourse for retail crimes also allows other types of organized crime to flourish, since ORC can be connected to other serious criminal activities.

Links between ORC and other organized criminal activities

Organized crime is like a web, where everything is connected together.

This means that ORC is often not isolated to retail, but has links to other organized crimes such as human smuggling, drug trafficking, and more. Many people involved with some form of organized crime are entangled with other serious crimes such as immigration fraud, modern slavery, illegal firearms, and terrorism.

Here’s an example of how ORC ties in with other organized criminal activities: 

An organized crime group will prey on people who might be in the country illegally, are dependent on drugs, or are otherwise in a vulnerable position. They will use these people to commit ORC offenses, forcing them to take on most of the risk and become indebted to the traffickers with little compensation. The money that results from these ORC activities is often laundered and invested in other criminal activities both domestically and internationally.

Therefore, ORC is not just a problem that only impacts retail and treating ORC incidents as bottom-rung misdemeanors actually helps to fuel other serious crimes in society.

What is needed to address the problem?

There is no silver bullet for solving ORC. It’s a complex problem that requires action from several key players.

1. Strengthen laws around online marketplaces

Online marketplaces need stricter rules around identifying sellers and verifying products. Currently, there is a bill in Congress called the INFORM Consumers Act, which requires high-volume and high-value sellers on online marketplaces to disclose their identification, contact information, and bank details. The bill is led by the Buy Safe America Coalition and endorsed by the US Chamber of Commerce and some state law enforcement officials.

While progress on the bill is slow at the federal level, 10 states have now passed the legislation to regulate online marketplaces.

2. More collaboration and information sharing

ORC thrives when retailers, law enforcement, and retail organizations don’t work together because it allows the people who are committing the crimes to remain anonymous. It’s also difficult to connect the dots between people causing harm and loss when nobody is sharing information.

With more collaboration, everyone can work together against a common enemy.

3. Continued support from organizational leadership

In general, retailers have experienced increasing support and investment from their leadership teams to address ORC. There is a greater understanding of it amongst C-suite teams and some are starting to speak out publicly about the impacts of ORC on their organizations.

AP/LP and ORC teams should continue educating leadership on retail crime to build on the progress made.

4. Keep improving relationships with prosecutors and law enforcement

There are many incredible law enforcement partners who understand the importance of solving ORC and go above and beyond for their communities. It’s important to keep these partnerships thriving, to continue educating other law enforcement agencies and prosecutors on ORC, and to keep providing the information needed for law enforcement to act.

Retailers have a responsibility to provide the necessary proof for prosecutors to consider, which makes the next point crucial.

5. Invest in the right tools

Instead of using tools that only act as record-keepers, invest in a tool that helps to collect intelligence and information that can be used to prevent future crimes and as evidence for prosecution and law enforcement.

For example, Auror’s Retail Crime Intelligence platform allows users to quickly and easily report information about incidents and the people involved, and add any relevant photos and videos. Other stores in the same organization will then receive notifications each time a person of interest is detected nearby, helping them to preempt a potential crime event at their own stores. They can decide based on past information of a person’s event history how they wish to deal with them if they show up, avoiding potentially dangerous situations.

This information can easily be downloaded as evidence for a case, or sent directly to law enforcement. 

Solving ORC matters

ORC is much more than just your average shoplifting incident.

In recent years, we have understood its total impact with more clarity than ever more. ORC incidents are increasingly violent and aggressive, sometimes leading to bloodshed. It’s not confined to the retail sector and undoubtedly helps to fund many types of serious crimes that impact society at large.

It’s clear that more urgency is needed to address ORC and the responsibility for that can’t continue to fall on AP/LP and retail store teams alone anymore. Law enforcement, prosecutors, policymakers, and company leadership all have important roles to play.

AP/LP teams are a key differentiator in solving ORC. Read why they're more important than ever.

August 15, 2022
Organized Retail Crime

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