WASHINGTON — Retail executives are urging federal lawmakers to pass legislation making organized retail crime a federal crime and stepping up restrictions on online auction sites used to fence stolen retail goods.
The executives addressed three ORC bills currently under consideration in Congress late last month in a conference call hosted by the Coalition Against Organized Retail Crime, one day before a hearing on those bills before the House Judiciary Committee Subcommittee on Crime, Terrorism, and Homeland Security.
“ORC is a federal issue,” said Kathleen Smith, vice president of loss prevention for Safeway, Pleasanton, Calif. “We watch stolen goods travel from Washington [state] to Oregon, California, Texas, Florida and New York. Criminal organizations know state law and how to beat the system.”
Recognizing ORC at a federal legislative level would “standardize the legal consequences across the country and aid in deterring this activity in all retail establishments,” Smith added.
“ORC rings have networks throughout the U.S. and distribute goods through interstate commerce, so this is a federal problem,” noted Frank Muscato, organized retail crime investigations supervisor, Walgreen, Deerfield, Ill.
The three pending bills are the E-Fencing Enforcement Act of 2009 (HR 1166), introduced by Subcommittee Chairman Robert “Bobby” Scott, D-Va.; the Organized Retail Crime Act of 2009 (HR 1173), introduced by Reps. Brad Ellsworth, D-Ind., and Jim Jordan, R-Ohio; and the Combating Organized Retail Crime Act of 2009 (S 470), introduced by Sens. Richard Durbin, D-Ill., and Amy Klobuchar, D-Minn.
A fourth bill, the Organized Retail Crime Prevention and Enforcement Act of 2009 (HR 4011), was introduced after the conference call by House Judiciary Committee Ranking Member Lamar Smith, R-Texas, and Rep. Robert Goodlatte, R-Va. The bill was applauded by the Coalition Against Organized Retail Crime.
Separately, Food Marketing Institute praised Rep. Scott, chairman of the House Judiciary Subcommittee on Crime, Terrorism, and Homeland Security, for holding a hearing on strengthening anti-crime laws to combat the growing problem of ORC.
The various bills offer different approaches to combating ORC. But taken together, observed the National Retail Federation in an ORC study released earlier this year, they would define ORC as a federal crime for the first time and toughen federal sentencing guidelines for criminals convicted of ORC. The bills would also require operators of online auction sites to cooperate with retailers and law enforcement officials in ORC investigations, and, in some cases, would hold auction sites responsible for the sale of stolen merchandise that could have been prevented.
In addressing online auction sites, the bills would “take the first step to bringing transparency to the process,” said Joe LaRocca, senior asset protection advisor, NRF. The transparency, he added, would be similar to what is required in the United Kingdom, where business sellers are required to post information such as contact details so that “consumers can see who they are doing business with and whether they are legitimate sellers or not.”
EBay, an online auction site, has consistently criticized the legislation. In a statement issued last week, Tod Cohen, vice president and deputy general counsel for government relations at eBay, noted that while eBay supports increased funding for law enforcement and stiffer penalties for retail crime offenses, “we believe the current legislation before Congress fails to address this challenge holistically and instead places unfair blame and discriminatory burdens on online marketplaces.”
With health care dominating the agenda in Congress, John Emling, senior vice president, government affairs, Retail Industry Leaders Association, Arlington, Va., said he expects action on ORC legislation “in the first part of next year.” Following last week's House hearing, “we're hopeful the Senate will follow with a hearing if not this year, soon into next year.”