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Breaking News in the Industry: December 18, 2018

Employee charged in $250K theft

A Greeley woman was formally charged on suspicion of stealing more than $250,000 from her employer, Offen Ace Hardware. Kristi Marie Chairez, 32, faces one count of theft of $100,000 to $1 million, a Class 3 felony punishable by up to 12 years in prison. She appears for an advisement hearing at 9 a.m. Januray 17 in Weld District Court.

The charge stems from an investigation that began April 9 when Chris Ruth went to the Greeley Police Department to speak with fraud specialist Christy Hardwick about a possible embezzlement at Offen Ace Hardware, which she owns with her husband, Bill. Ruth told police she and Bill planned to retire soon and groomed Chairez, a trusted employee, to take over the business. Chairez graduated from Aims Community College in 2013 with a degree in accounting. Ruth told police they helped pay for Chairez’s education.

After she graduated, Chairez was promoted to account manager. They turned over the day-to-day operations to Chairez on October 1, 2013. There were discussions she may someday purchase the business from the Ruths. However, more than four years later, on April 2, the Ruths were alerted by their bank that the hardware store accounts were significantly overdrawn. They began to investigate and noticed a number of examples of suspicious account activity. All told, Chairez stole more than $258,000 from the Ruths through property, cash taken from the registers, loans and mysterious deposits, as well as payments to credit card companies, according to court records.   [Source: The Tribune]

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Shoplifting blitz nabs 30

The Saginaw Township Police Department Crime Prevention Unit coordinated the blitz, which ran from Thursday, Dec. 13, through Friday. Saginaw County Sheriff’s deputies, Michigan State Police troopers, and Carrollton Township police officers assisted in the effort.

Police worked closely with store management, employees, and loss prevention and security personnel to identify and apprehend suspects committing retail-related at businesses in Saginaw and Kochville townships, said Saginaw Township Police Lt. Rick Herren. Police arrested 30 people and recovered more than $4,500 in stolen merchandise during the two-day endeavor, Herren said.

“Officers were also able to clear a number of outstanding arrest warrants during their contacts with the arrested individuals and apprehend two groups who had recently evaded arrest after targeting our stores,” Herren said. “The Saginaw Township Police Department is proud of the efforts of the officers and store personnel and thanks everyone who took part in this successful operation.” [Source: MLive]

Counterfeit goods surge over the holidays

Most people don’t realize that when they buy counterfeits they are supporting organized crime, and in some cases seasoned criminals’ second careers. “We know that counterfeiting has become a very attractive retirement program for drug dealers,” said Ann Harkins, CEO of National Crime Prevention Council (NCPC), at a recent Congressional briefing about anti-counterfeiting efforts. “Why? It’s cleaner. It’s safer. They are not as likely to get caught. If they get caught they are not as likely to do as much time.”

The proliferation of fake goods has surged, leaving manufacturers scrambling to keep them out of their supply chains. A test conducted earlier this year by the U.S. Government Accountability Office found that 20 out of 47 products sold by third-party sellers online were revealed to be counterfeits, leaving both the government and corporations to chase after fraudulent sellers. In 2017 the U.S. Customs and Border Protection (CBP) and U.S. Immigration and Customs Enforcement (ICE) seized a record number of shipments of illegal goods, with a combined $1.2 billion price tag had the goods been genuine.

The holiday season only increases the likelihood consumers will encounter counterfeit goods, including decorative lights, small electronics, sneakers and toys. This year retailers have offered fantastic discounts on products, and shoppers have rewarded them by spending over $6 billion online on Black Friday and $7.9 billion on Cyber Monday, according to Adobe Analytics. But, the hunt for the best sale can lead consumers to counterfeit items… often unwittingly.    [Source: RetailDIVE]

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Prolific fraudster gets jail time for 500 counterfeit cards

A man arrested last year in possession of more than 500 fraudulent credit and debit cards, which he used to rip cash from legitimate accounts, will serve five years in prison, according to the office of the U.S. attorney for the district of Nevada. Khachatur Zakaryan, 37, of California, who was sentenced Thursday in a Las Vegas federal court, was ordered to three years of supervision once he’s out of prison, officials said.

The scam took place around February 2017 when Zakaryan and unnamed perpetrators obtained counterfeit cards encoded with previously stolen account numbers, officials said. Zakaryan then drove to various ATMs across the Las Vegas area to withdraw cash. The criminal complaint doesn’t indicate how much money was taken.

The ruse occurred in a short period of time, officials said. Law enforcement officials previously said each fraudulent card can generate between $2,000 and $4,000. When law enforcement searched Zakaryan, his van and hotel rooms, they found 530 such cards, officials said.

Zakaryan was not a stranger to the crime or to law enforcement, officials said. He’d been on probation in a similar case at the time of his latest offense. He also is facing charges in North Carolina on allegations of ATM skimming and fraud charges, officials said. In the local case, Zakaryan had pleaded guilty to four counts each of producing, using, or trafficking in a counterfeit access device, and aggravated identity theft, and one count of possession of 15 or more counterfeit or unauthorized access devices, officials said. He didn’t qualify for a plea agreement. An FBI task force and Henderson Police investigated the case.   [Source: Las Vegas Sun]

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Good Samaritan tackles suspected game thief

A would-be retail thief in Greenfield, Wisconsin, was stopped in the act after a bystander stepped in and tackled the suspect before he made off with almost $300 in video games.Christopher J. Simpson, 39, of Wauwatosa is facing a charge of misdemeanor theft in connection to the incident, which could land him up to nine months imprisonment or $10,000 in fines if he is convicted.

According to the criminal complaint, a Greenfield officer responded to Walmart and found an individual holding down Simpson. Simpson told police he had tried to steal some video games but was stopped and then tackled by a “random guy.”

A store security officer told police Simpson had a female accomplice who had the games in her bag. She then gave them to Simpson, who tried concealing them with his clothes. In all, Simpson tried leaving with 10 to 15 video games worth a total of $274. Charges have not been filed against the woman, according to online court records.  [Source: Journal Sentinel]

CEO stops practice of corporate cards used for expensing strip club visits

Under Armor CEO Kevin Plank says he wants to build a “diverse” and “inclusive” company, following a report earlier this year that exposed that the company had been letting its employees charge visits to strip clubs on their corporate cards.

“No one would ever tolerate that,” Plank told CNBC’s Sara Eisen on Thursday morning, on the heels of Under Armour’s annual meeting with investors. “I want to make sure that I set the record straight on that.”

The practice of letting workers expense strip club visits to win over athletes was stopped in February, though it had been happening for years, The Wall Street Journal reported last month. Meanwhile, two of Under Armour’s top executives were reportedly ousted recently after reviews of their credit card charges.

“All these things that are coming out, it’s difficult,” Plank said Thursday. “You know, we are in our 14th year as a public company. That much time in the arena means that at some point you are going to have to retool the machine.”

Plank’s comments about creating a more welcoming workplace come after Under Armour delivered what was largely received by Wall Street as underwhelming financial targets for the next five years, especially for North America.   [Source: CNBC News]

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