Asset Misappropriation: Merchandise Theft

Introduction

Organized Retail Crime rings and boosters target inventory in a number of ways. Losses resulting from larceny can run into the millions of dollars. The definition of larceny is: “Felonious stealing, taking and caring, leading, riding, or driving away another’s personal property with the intent to convert it or deprive the owner thereof.” This definition is so broad; it encompasses every kind of asset theft.

Boosters working in groups rather than alone often have at least one member of the group act as a lookout who scouts for employees, plain clothes security officers, or cameras. These lookouts may create diversions or distract employees to facilitate the work of the boosters actually stealing the merchandise.

To help prevent thieves from stealing these goods, many retailers place electronic detection tags on merchandise.

Transactions

Stolen goods trading typically involve several steps, beginning with the theft itself and culminating in an end-consumer’s obtaining the stolen goods. Understanding the actions offenders take and the challenges they face in each step will help you design methods to disrupt the process at several points in the crime process.

As with any market, the relationship between supply and demand for stolen goods can be complex. Generally, the demand for stolen goods increases the incidence of theft. This makes sense because, for the most part, thieves won’t steal goods unless they first know or believe other people will buy or trade for them. General awareness that many business owners and members of the wider public are willing to buy stolen goods motivates thieves to start and continue stealing. Young thieves learn from their families, neighbors, and peers about their community’s willingness to buy stolen goods. Knowing who buys stolen goods and how to deal with them makes stealing a viable choice for some young people growing up in less wealthy areas.

The supply-and-demand relationship is not always this simple. The relationship between people’s willingness to buy stolen goods and others’ readiness to steal them is sometimes complex (Ferman, Henry, and Hoyman, 1987).

The Problem of Stolen Goods Markets

Once thieves know people are generally willing to buy stolen goods, stolen goods markets are mainly fuelled by thieves’ offering goods for sale, rather than by proactive demand from dealers or consumers. Thieves’ offering to sell stolen goods has the greatest influence on how stolen goods markets operate. This is because most dealers and consumers do not actively seek out stolen goods: someone needs to offer these items to them. Strangers frequently offer small- business owners stolen goods. Sometimes thieves steal items to order. This means they are asked to supply particular products or quantities by theft. Prolific fences tend to encourage thieves to increase their offending in this way. But stealing to order is not as common as stealing to offer.

Commonly Stolen and Sold Goods

Knowledge of the “standing demand” for stolen goods affects the type of goods stolen. The items in greatest demand at the time can dictate crime waves when thieves target particular highly sought items. Statistical research proves that most thieves have an ever-changing hierarchy of goods that they prefer to steal. Research with thieves themselves reveals that they rarely hoard stolen goods for more than an hour or two, at most, since they seek as near to immediate cash returns as possible—and want to avoid getting caught in possession. This means that thieves are unlikely to steal and hoard goods that they do not currently know to be in high demand on the off chance that they will be saleable in the future. Since most thieves steal because they want money in a hurry, at the top of their list is cash, followed by items that they can easily and quickly sell for relatively high prices, such as jewelry and high-tech home entertainment equipment.

Understanding what makes products attractive to thieves will help you anticipate new theft targets, and consequently what new products are likely to become popular in stolen goods markets. So-called “hot” products typically have one or more of the following attributes that can be summarized by the acronym CRAVED, in that they are the following:

• Concealable
• Removable
• Available
• Valuable
• Enjoyable
• Disposable

The more of these attributes an item has, the more attractive it is for someone to steal it. However, because we know that prolific thieves rarely steal items for their own use, the last three attributes are the most important because they relate to items’ worth and not just to their portability. It is this worth of items that makes them disposable as products that thieves can sell or swap for drugs. The demand for and prices of goods in the legitimate market influence what products are hot in stolen goods markets. Knowing, for example, what retail goods shoplifters are stealing, while perhaps not too important to police from a criminal investigation standpoint, might be quite important from a crime prevention standpoint, because shoplifting is often a gateway crime to more-serious theft and a fallback crime for prolific burglars to support their drug use.

Methodologies Employed

Boosters often circumvent detection systems by cutting off or melting the tags, covering the tags in foil or concealing the merchandise in foil-lined bags (often referred to as “magic” bags), or lifting goods over the antennas of the electronic detection systems. In some instances, boosters take shopping bags directly from the store, fill them with merchandise, and walk out of the store, appearing as though they are carrying purchased goods. Store employees may be less likely to stop and question boosters carrying shopping bags from the store because they incorrectly assume that the merchandise has indeed been paid for.

In addition, boosters do not always steal merchandise from retailers during business hours. Some may hide in stores and wait for all employees to leave before removing large amounts of goods through emergency exits. Others conduct “smash-and-grab” burglaries, in which they steal trucks and vans to ram through store walls and windows, load the vehicles with merchandise, and drive away.

At times, boosters also conspire with current or former store employees. Employees may take goods from storage rooms or receiving areas in stores and provide them directly to boosters. They may also help thieves by disabling store alarms, leaving doors unlocked or providing information about computer passwords, alarm codes, keys, and management and security schedules.

Be on the alert for “booster” devices, which range from clothing worn to conceal stolen product (e.g., coats, jackets, expandable underwear and socks, etc.) to large purses, backpacks, shopping bags, boxes and even baby strollers. Oftentimes shoplifters will use a bag, purse or backpack as a tool to conceal merchandise. During rainy weather, umbrellas are a handy tool for a shoplifter to conceal small items. The booster will keep the umbrella closed facing down, making it easy to conceal a small item. Other boosters will just pick up merchandise and walk out the door. They rely on the cashier’s reluctance to challenge them.

How boosters defeat the systems

Tools: Any number of tools found in the average toolbox or car trunk can be used to break, detach, short out and generally defeat the common EAS systems used by retailers. A great number of boosters, when searched by Law Enforcement, have within pockets or purses, some kind of tool used for EAS removal.

Skill Level: Novice to Medium.

EAS Jammer: These items can be purchased online for reasonable prices, and instructions for their creation can be found even cheaper (even free). These items defeat the signal range used by the EAS Detection pedestals used at exits and department separations and allow an item to pass without being detected. Often slightly unreliable, and only able to be powered for a few minutes at a time, these tools are not found in use very often, but are an immediate indicator of either a pro-level solo shoplifter or an ORC group.

Skill Level: Novice to Medium.

Aluminum Foil Booster Bag: This is the pro-level use of Aluminum Foil. The shoplifter has created a bag/box/backpack lined with thick layers of aluminum foil as a total enclosure (with a closure flap, is order to not have to mess with sheets of foil and make noise that will cause the crime to be detected. The aluminum, as before, creates a barrier which stops radio communication from the pedestal to the tags contained within. For the techie reading this, the booster bag is now a Faraday Cage. The bag can look like a purse, shopping bag, backpack or any other item they desire.

Skill Level: Medium to Pro. Come back soon for a follow up article on this subject.

Avoidance: Some boosters choose to completely avoid EAS systems all together by either stealing items that are not tagged/wrapped or, even worse, items that are tagged but through routes that are not protected (Namely Emergency Fire Exits). Some of the largest EAS items, or large numbers of smaller items, are simply bagged, carried or carted to the nearest fire door and ran to an awaiting driver and vehicle. The use of the fire door (unless also defeated) is an immediate cause for attention in the area and brings any attentive associates to the area. There are almost always witnesses to these instances, since the thief is in a rush and making noise since he knows his time is limited, but the very nature of this type of theft makes in incredibly hard to prevent. In this instance, witnesses and license plates are your friend.

Skill Level: Medium to Pro. Come back soon for a follow up article on this subject as well.

Skill Level: Pro.

Aluminum Foil: Any item containing or contained within a device that is designed to communicate with an EAS Pedestal can be defeated if you deny the communication. Quality aluminum foil, or cheap foil in abundance, can be used as a barrier that will deny the radio communication between the item and the tower, preventing the alarm from sounding. This tactic is used by beginners, is fairly noisy and easy to detect (because the sound of foil in your fitting room is pretty obvious), but is still fairly frequently used for electronics theft.

Skill Level: Pro.

Detacher Keys: Any retailers using EAS systems will have some kind of detacher key for removing the systems in place when paying customers want to purchase an item. Producers of these keys do not, for the most part, sell them to just anyone who wants to buy so the majority of keys are well secured in warehouses and retailer locations. There is, of course, the occasional employee theft and customer theft of these detacher keys. This is where the internet comes in. Another simple search will show that stolen keys are being sold, resold and discussed all over the place. They are a highly popular tool for theft and are the fastest and easiest way to defeat the EAS systems.

How to investigate it

Merchandise theft investigations often begin with Asking the Right Questions

The following are some critical questions you should ask in analyzing your particular stolen goods markets problem, even if the answers are not always readily available. Your answers to these and other questions will help you choose the most appropriate set of responses later on. Some of these questions can be answered only through in-depth interviews with thieves. It is important to note that these questions should be asked before new anti-fencing initiatives begin and then again once they have had an opportunity to take full effect. By way of example, after an anti-fencing initiative, any recorded falls in theft, accompanied by:

I. A decrease in perceptions of ease of selling and buying among offenders and/or
II. Increases in risks and decreases in the perception of the rewards of selling and buying stolen goods would indicate that it is the police operations that have had the desired effect on falling theft levels rather than some other cause.

Such measures are most important in finding out what works in reducing stolen goods markets and when seeking to attribute causes to falling theft figures. Similarly, such qualitative data may also explain increases in theft levels if offenders reveal the existence of new buoyant markets for stolen goods.

Stolen Goods Markets

• How much stolen goods trading is occurring in your jurisdiction? (Remember that official police recorded crime data are of little help here since the public rarely report such
• Offenses and many receiving-stolen-goods cases are actually cases in which thieves have pled guilty to a lesser charge when evidence of the original theft is weak. Therefore, qualitative data of the kind recommended in the Understanding Your Local Problem section above are invaluable.
• What types of stolen goods markets are dealing in particular types of stolen goods?
• Are certain types of markets shrinking or even shutting down? Are new types of markets emerging?
• Where are the markets for particular types of stolen goods?
• What is the typical discount rate for stolen goods? Is this increasing or decreasing?
• What proportion of goods stolen in your jurisdiction do you estimate are then sold in stolen goods markets, as opposed to being used by the thief, recovered by police, or discarded?
• How easy and quick is it for thieves to find a buyer for their stolen goods?
• How easy and quick is it for fences to find a buyer for their stolen goods?
• How do thieves transport stolen goods to fences?
• What do thieves typically do with property immediately after stealing it (e.g., sell it or trade it immediately on the street, hide it while searching for a buyer, sell it immediately to a pawnshop or fence)? How often do thieves need to dump goods that they could sell?

Understanding Your Local Problem

• Offenders/Thieves
• Who deals in particular types of stolen goods, which markets are they dealing in, and how?
• What do thieves perceive to be the risks of selling stolen goods?
• What do thieves perceive to be the rewards of selling stolen goods? How do thieves avoid being detected when selling stolen goods?
• How do thieves learn where to sell stolen goods?
• How safe do thieves feel transporting and stashing stolen goods?
• How safe do thieves feel when dealing with a fence?
• How concerned are thieves about getting caught?
• How much do thieves know about police operations against stolen goods dealing?

Fences

• Who are the fences (e.g., professional, quasi-legitimate merchants)?
• What do fences perceive to be the risks of buying stolen goods?
• What do fences perceive to be the rewards of buying stolen goods?
• Consumers
• Who in your jurisdiction tends to buy property that they know or should suspect is stolen?
• What do consumers of stolen goods perceive to be the current risks of buying them?
• What do consumers of stolen goods perceive to be the current rewards of buying them?

Targets

• What types of goods are commonly being sold in stolen goods markets? Which types of targeted goods are newly popular? (Monitoring international, national, and local changes
• In the supply, demand, and price of certain goods and commodities can help you anticipate new theft and stolen goods trading problems. For example, global shortages of various metals have preceded surges in metal theft many times in the past. Simply keeping an eye on newspaper and other news items may reveal trends in this area. For example, a surge in reporting of strange thefts of cast iron road and side-walk drain covers, large bronze sculptures, metal road signs and copper wiring from electricity sub- stations and railway sidings are all examples of the upsurge in scrap metal theft caused by global shortages at the time of writing. Police agencies without resources for monitoring
  

**Such factors might form useful collaborative research partnerships with university departments specializing in the effect of market trends upon crime, or those with an interest in developing such expertise.

Locations and Times

• Where are the fencing operations located within your jurisdiction?
• Are there seasonal variations in the types of goods traded in stolen goods markets (e.g., snow-blowers in winter, lawn mowers in summer, stereo equipment and laptop computers at the beginning of universities’ academic years, textbooks at the beginning of semesters and just before exam periods)?

Tips for Understanding Local Stolen Goods Markets

• Interview a sample of people who work in the wholesale and retail goods sectors.
• Without talking about crime, find out how and why goods are rejected by or shipped away from the retail stores that originally bought them, and where they end up.
• Map possible stolen goods market hot spots. Discuss with colleagues, informants, offenders, ex-offenders and other experts such as government officials or criminologists why certain areas might be conducive to stolen goods markets.
• Photograph store signs in your jurisdiction that seems to invite thieves to sell stolen goods there. Again, discuss with crime experts of the type listed above.
• Conducting representative surveys of theft victims and of the general public at the county, city or town level is expensive, is time-consuming, and due to the specific characteristics of local crime problems offers little useful information for local initiatives.

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