Retailers Launch New Database to Track Organized Theft

MICHAEL GARRY

WASHINGTON — A long-awaited national database designed to help retailers and law enforcement report, track and investigate retail criminal activity was launched here last week.

The database, called the Law Enforcement Retail Partnership Network (LERPnet), combines elements of databases already developed by the National Retail Federation here and the Retail Industry Leaders Association, Arlington, Va. The two associations also collaborated with the Federal Bureau of Investigation here in the development of LERPnet, which will be a repository of retail incidents, including organized retail crime, robberies, burglaries, cargo theft, fraud and Internet-related crime.

LERPnet will enable retailers to share information about incidents at their stores with other retailers and law enforcement in order to maximize anti-crime efforts. The database will be managed by NRF, with cooperation from RILA, the FBI and other trade associations.

“With this system, retailers are banding together with law enforcement to send a clear message to criminals: We will not tolerate your behavior and we will stop you,” said Joseph J. LaRocca, vice president of loss prevention for NRF, in a statement.

Retailers, who will be charged an annual $1,200 fee to use the Web-based network (accessible at www.lerpnet.com), will be able to enter retail crime incidents immediately after they occur, including photos and video footage, or upload incidents using an existing case management software system. Additionally, the system allows retailers to receive email alerts about retail crimes in their area.

The LERPnet data can include details like vehicle descriptions and names of suspects, as well as detailed product information, but retailers will have full control over visibility of all information entered into the system. “They could suppress their company name or share it with other retailers they choose to trust,” said LaRocca, speaking on a conference call held prior to the launch of LERPnet on April 9. Information related to law enforcement actions, he noted, is often available through the police as “a matter of public record.”

Beginning this summer, law enforcement agencies will have free access to LERPnet through law enforcement online (www.leo.gov). “Imagine a day when a state trooper pulls over a vehicle carrying [large amounts of] product,” said LaRocca. “The trooper could access LERPnet and find enough information to hold the vehicle and require proof of ownership.”

The database will also offer reporting and analysis that tracks incidents by retail sector, product and geographic region. It will also collect information on security devices used in stores. “We foresee a module that will allow retailers to project the type of equipment needed when they open new stores,” said LaRocca.

“The primary benefit of participating in [LERPnet] is that we now have the opportunity to more quickly identify trends and/or losses that we wouldn't normally see,” said Bill Titus, vice president of loss prevention, Sears Holdings, Hoffman Estates, Ill., in a statement on www.lerpnet.com. “Not only can retailers identify the potential losses much quicker, but it gives retailers a much stronger case when it comes to prosecuting organized theft rings.”

DRAWING FROM RLPIN

LERPnet is based on the NRF's own retail crime database, the Retail Loss Prevention Intelligence Network (RLPIN), launched last year, as well as RILA's InfoShare database. LERPnet will incorporate the 35 retail companies, including at least four food retailers, using RLPIN, along with the more than 14,000 retail crime incidents stored in RLPIN. LaRocca said LERPnet is projected to contain “hundreds of thousands of incidents.”

LERPnet is viewed as a response to what NRF called “an alarming rise in organized retail crime [ORC].” According to a survey NRF conducted last year, 81% of retailers said they were victims of organized retail crime rings, which use teams of shoplifters, or “boosters,” to pilfer high-value products like baby formula, razor blades and dietary supplements, often reselling them online for 70% of their retail value. “As a major target of ORC, supermarkets are the one sector in the industry that has had its eye on the ORC ball for years,” LaRocca told SN in January. “Most of the other retailers are just now catching up.”

Statistics gathered from RLPIN to date indicate that the states with the most retail crime activity are, in decreasing order, California, New York, Florida, New Jersey and Texas. The top cities are Miami, New York, Los Angeles, Las Vegas and Orlando, Fla. In total, retailers lost $37.4 billion to shrink in 2005, up 20% from the previous year, according to the University of Florida's National Retail Security Survey.

In the conference call, LaRocca described a recent case in Southern California involving RLPIN. A retailer that had experienced a string of burglaries noticed a similar burglary entered into the database by another retailer who was not identified. NRF was able to bring the two companies together “and now they are going after the groups responsible,” he said.

Funding for the creation of LERPnet came entirely from the private sector. “NRF invested money to build the system,” said LaRocca. “We got no money from the public sector.” A federal law enacted last year set aside $5 million for three years for the FBI to set up an ORC Task Force, but “we do not forecast that any of that money will fund this project,” he added.