Federal Policies, AI and Supporting Law Enforcement: Retailers Fight Back Against ORC

It takes a village to reduce the impacts of organized retail crime (ORC) in stores and online. More specifically, it takes consistent collaboration among retailers, governmental bodies and law enforcement.

Unfortunately, retail crime is increasing, so all stakeholders need to step up their efforts.

In 2022, shrink caused retailers $112.1 billion in losses, up from $93.9 billion in 2021, according to a retail security report from the National Retail Federation (NRF) and the Loss Prevention Research Council (LPRC). Notably, theft (both internal and external) accounted for nearly two-thirds of the total shrink found in the report.

Retailers and their loss prevention teams can’t tackle the problem alone. To combat ORC groups, retailers need to rely on new tools and strategies that better foster collaboration between them and law enforcement. Retailers also need to support organizations looking to enact laws that mitigate ORC.

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Promoting Policies at the Federal Level To Reduce Retail Crime

At the highest level of collaboration, retailers are working with the U.S. government on legislation countering retail crime. Last year, the INFORM Consumers ACT was signed into law after retailers, alongside NRF, helped advocate to Congress the need to deter sales of stolen or counterfeit products online. The INFORM Consumers Act brings transparency to online marketplaces by requiring them to verify the identities of high-volume third-party sellers. It also helps limit the fencing of stolen merchandise and mitigates the sale of counterfeit goods online.

Furthermore, NRF is pushing Congress to pass bipartisan legislation to fight ORC and develop a concentrated center against retail crime inside the Department of Homeland Security. The proposed law — the Combating Organized Retail Crime Act (H.R. 895/S. 140) — continues to gain traction and co-sponsors in the House and Senate. If passed, the bill aims to improve how federal, state and local law enforcement teams coordinate around ORC. The center will be a place where all law enforcement agencies can combine resources and expertise to fight ORC.

Building Better Cases with Law Enforcement

On a more intimate level, retailers also need to collaborate closely with law enforcement to build stronger cases against ORC and enhance the investigation process. Currently, loss prevention teams pull videos and materials for law enforcement to review, but there are ways to share materials faster and investigate together in near-real time.

One way to do this is by exploring more collaborative technology like generative AI. For instance, loss prevention teams that manually dig through incident reports to find connections to larger ORC groups can spend hours trying to build a case. But with the assistance of AI and automation, teams can find and link incidents of criminal activity by searching specific suspects, vehicles, use of weapons and even keywords to connect certain narratives quickly.

The volume of ORC cases is massive, and these criminal groups are becoming more sophisticated in how they hide theft of products online, file false claims for refunds, return stolen goods to stores and more. Data and how cases get reported are the anchor of how retailers and law enforcement can collaborate to mitigate losses.

With the help of technology like generative AI, loss prevention teams realize new benefits like:

• Accelerating report generation.
• Linking cases together by searching beyond basic incident details like a suspect’s name and description, but by similarities in narratives within cases, such as use of weapons for example.
• Sharing information directly with law enforcement faster and giving them access to offer instant feedback.
• Streamlining the management of photographs, recordings, case documentation and other data through automated systems to bolster law enforcement’s investigative efforts against extensive ORC networks.

Preparing Stronger ORC Cases

Of course, with or without technology, retailers need to assist law enforcement in the best way they can. This requires packaging clear and consistent reports that include executive summaries of incidents, summaries of video evidence and a detailed breakdown of the financial losses incurred. A well-prepared report increases the likelihood that law enforcement will follow up with prosecution in a retailer’s ORC case.

Another wrinkle when going after ORC cases is that every state has established a specific, varied dollar amount that allows law enforcement to file felony charges. Through stronger reporting capabilities that identify and link cases, retailers can combine cases and target ORC rings that near the “felony theft threshold,” as law enforcement puts it.?

Lastly, loss prevention investigators must build cases and see them through to the end. When cases are properly built, retailers can save law enforcement time and steps needed to prosecute cases.?

In the end, battling ORC requires thorough collaboration. It’s not an easy task. But with better technology, retailers can be stronger, collaborative partners, working side by side with law enforcement and governmental bodies. Together, they can join forces and help protect the billions of dollars in losses impacting a vital industry in the U.S.

Kathleen Garner is Strategic Customer Success Manager at Appriss Retail . With over 20 years in the retail loss prevention sector, she has held various positions including Director of Loss Prevention Administration at Kmart.