NRF PLANS NETWORK FOR SHARING THEFT DATA

Michael Garry

WASHINGTON -- In an effort to help retailers collaborate better with each other and with law enforcement on reducing retail theft, the National Retail Federation here plans to launch a Web-based network this month for sharing information on criminal activity.

The network, called the Retail Loss Prevention Intelligence Network (RLPIN), will allow any retailer to use a Web browser to share data on criminal activities taking place in its stores, such as items stolen and names or pictures of suspects. It will also allow retailers to access other retailers' data, subject to limits placed on the sharing of that data.

"We want the system to meet retailers' own standards for sharing information," said Joseph J. LaRocca, NRF's vice president, loss prevention. Retailers will be able to "disclose as much as they want." They will also be able to indicate which sectors, groups or individual companies should be excluded from seeing their data, and whether it should be made available to law enforcement, he added.

The network is aimed at reducing any type of criminal behavior in stores, including robbery and credit card fraud. But its biggest target is organized retail theft (ORT), which is perpetrated by organized theft rings that operate across retail sectors and regions. "There needed to be a way to share [ORT] information between competitive retailers and with law enforcement," said LaRocca.

Walgreen Co., Deerfield, Ill., which consulted with NRF on the development of RLPIN, will "evaluate what we can put in there" once the program is under way, said Jerry Biggs, Walgreen's organized retail crime division coordinator. It would most likely pertain to "burglaries, robberies, serious crimes, as well as organized retail theft."

Biggs said a nationwide network was needed so retailers in different parts of the country can determine whether they are dealing with the same crime ring. RLPIN "will definitely be a great enhancement in fighting ORT and helping law enforcement," he added.

Biggs noted that in addition to NRF, the Retail Industry Leaders Association (RILA), Arlington, Va., is planning to offer a loss prevention network, called InfoShare. Walgreen is considering each network, but could end up using both, he said. Biggs favors RLPIN, though he will not be making Walgreen's decision, he said. LaRocca said that RLPIN is an open system that will be able to link to RILA's network, as well as any other source of loss prevention data.

RILA unveiled plans for the InfoShare network in June. Food Lion, Salisbury, N.C., was among the retailers participating in a pilot of the network, according to RILA.

LaRocca acknowledged that RLPIN "needs to be secure, because it will house some ugly secrets." To access the network, retailers will need an ID, password and an additional security ID provided by a device that changes the ID every 60 seconds. A basic annual subscription to the service will cost $1,200, and an advanced subscription, $4,800.

The RLPIN is open to all retailers, including food retailers. Though not a core part of NRF's membership, food retailers are being increasingly courted by the association, said Ellen Tolley Davis, director, media relations, NRF. As of last week, no retailers had committed to using the network, LaRocca said.

At NRF's Loss Prevention Conference in San Diego in June, where 31 supermarket companies were represented, 98% of respondents to a poll said that such a network was "absolutely needed," Davis noted.

RLPIN's basic subscription will allow retailers to transfer data from their internal systems to the network, regardless of what type of internal system they are using. The basic plan also enables retailers to receive e-mail alerts whenever data on specified types of criminal activity become available, and the plan allows retailers to run queries and generate reports.

The advanced subscription service offers the ability to track relevant information available outside the network, such as in news groups, Web sites or on eBay. The service can also "proactively link common items between retailers," LaRocca noted. "If two retailers both enter the same [suspect] license plate number into the network, it can tell each party that the license plate is under investigation and enable them to share notes if desired."

Organized retail theft is increasingly being recognized by law enforcement as a significant crime problem in the U.S., according to "Organized Retail Theft, Raising Awareness, Offering Solutions," released this year by NRF. "Losses to ORT rings are estimated to be $15 billion in food retailing alone and upwards of $25 billion in all of retail," the report said.

"Federal law enforcement officials have proven in a number of cases that much of the illicit proceeds earned by ORT rings have been laundered and sent to countries that support terrorist organizations," the report said.

LaRocca observed that ORT rings often targets infant formula and OTC drugs. By the time those products are re-sold to consumers, they are often spoiled, he noted.