LAAORCA: Taking a Bite Out of Organized Retail Crime

LAAORCA, the Los Angeles Area Organized Retail Crime Association, is still active and growing as a law enforcement-retail loss prevention partnership in the Los Angeles market. As similar organizations are established across the country, LAAORCA provides a model of success that others should consider in the ongoing fight against organized retail crime.

By many accounts, organized retail crime (ORC) is the 800-pound gorilla of modern-day retail theft. No longer are professional thieves interested in maintaining low profiles by keeping thefts small. Criminals now extensively and meticulously pre-plan daring raids with multiple individuals involved, often employing sophisticated technology and strategies previously reserved for high-profile thefts like bank heists.

These organized retail crime teams can hit a retail store and make off with tens of thousands of dollars worth of goods in minutes, then go on to hit multiple stores in the same day, and multiple cities in the same week; altogether stealing millions of dollars worth of goods in a very short period of time.

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Up until recently, these ORC hits often caught loss prevention and store personnel off guard, since mechanisms for rapid communications between competing stores and with law enforcement did not readily exist. Thankfully, that is largely changing with the increase in retail-law enforcement partnerships nationwide, one of the first of which was LAAORCA, the Los Angeles Area Organized Retail Crime Association, created to squelch organized retail crime in the Los Angeles basin.

The “O” in Organized Retail Crime

How organized is organized retail crime? According to Detective Kent Oda of the Los Angeles Police Department (LAPD), they are very organized. Oda, a 26-year veteran of the force and currently assigned to the Commercial Crimes Division, has witnessed multi-store, multi-city operations that utilize sophisticated criminal tactics.

For example, the thefts typically involve multiple “boosters”—the thieves who actually steal the targeted items. Also involved are personnel who act as “mules,” the same term used in drug trafficking to signify individuals who transport the stolen property. A high-end organized retail crime operation can involve many individuals, such as getaway drivers, multiple boosters and mules, and lookouts, as well as the use of disguises or distractions to deter store personnel and the employment of sophisticated countermeasures to defeat store loss prevention equipment.

The boosters may employ a range of equipment to help them accomplish the thefts, including sophisticated smuggling girdles or specialized lined merchandise bags intended to defeat electronic article surveillance (EAS) tags, and they usually rent getaway cars or use cars with paper plates to avoid detection.

These criminals target stores with laser-like precision, staking them out and casing well in advance, arming themselves with a large amount of intelligence before making the strike. They target specific hot products, such as baby formula, cosmetics, over-the-counter (OTC) drugs, DVDs, and other items that are expensive, yet have a small footprint for easy theft.

The impact to an individual store only can be massive, but when taken as part of a larger picture, the losses are staggering. A well-organized group of ORC criminals has been known to strike as many as ten stores in a day and forty stores in a week. Their crimes take place across multiple cities and jurisdictions, making it hard for law enforcement agencies to track them.

The individuals involved in these crimes are hardened veterans. LAPD, for example, rates boosters by levels, with Level 1 being the least organized. A Level 1 booster typically works alone and often steals casually or to support dependencies—your classic serial shoplifter. A Level 2 booster also usually works alone, but adds the element of stealing for resale. Level 2s are also known to travel to perform their thefts, all of which are the hallmarks of people that steal for a living. A Level 3 booster works as a member of a team, and steals almost purely for resale, as well as traveling far out of the area to conduct widespread crime. It’s the Levels 2 and 3 career professionals who comprise the majority of the scourge known as organized retail crime.

Organized retail crime isn’t pure profit for the criminals involved; they have expenses just like any other business. Stolen property is usually shipped via extensive freight networks across the country and even internationally, usually for resale. The goods are usually fenced through an elaborate network of brick-and-mortar retailers, many of which are small “mom-and-pop” stores, or via online stores or auction sites.

A Danger and an Expense

In some cases organized retail crime may additionally represent a health hazard to consumers who unwittingly buy stolen product at discount stores used to fence the goods. Baby formula and OTC pharmaceuticals are two examples. Both are perfect targets for organized retail crime since they are relatively expensive, have small footprints, and are in high demand on the fenced market. Criminals steal these products and often store them improperly, potentially causing a health hazard.

The loss of tax revenue is another side effect of organized retail crime that is often lost on the general public. Every product that’s stolen is done so tax free. The hundreds of millions of dollars’ worth of product stolen each year represents a significant loss of tax revenue that does not go to cash-strapped local and state governments to support legitimate public services.

Another ugly facet of organized retail crime is that it is not only highly lucrative, unfortunately it’s a crime that’s often lightly punished. A criminal operative with no prior record who is caught stealing $5,000 worth of goods, for example, can expect a sentence as light as probation, not much more than a slap on the wrists. Contrast that with stealing the same $5,000 from a bank in the form of a robbery, which carries a minimum sentence of twenty-five years to life, and it’s easy to see why criminals have migrated into this sector. Oftentimes, organized retail crime is a gateway crime to other illegal activities, such as drug trafficking, and the more experienced criminals usually dabble in a host of other illicit operations.

Enter LAAORCA

DAV_1375Recognizing the need to fight organized retail crime in a proactive rather than reactive mode, the Los Angeles Police Department decided to take action. LAAORCA was founded by LAPD’s own Captain III Bill Williams, head of the Commercial Crimes Division, as well as Detective III Kent Oda, and a host of retailers, including CVS/pharmacy, GAP, JC Penney, Lowes, Rite Aid, Target, Vons, and Walgreens. The idea behind LAAORCA is a simple one—retailers can pool information and share it directly with law enforcement, who can then prosecute the crimes far more swiftly and easily than they ever could in the past.

It’s the simple act of information sharing that makes LAAORCA so successful. Through LAAORCA, retailers in the LA area now have a forum to openly discuss organized retail crime, share information, case studies, surveillance video, and other intelligence on criminals who may be terrorizing multiple retail chains. Law enforcement can now receive this intelligence as it occurs, and immediately corroborate it with another retailer to piece together emerging crimes as they happen, as opposed to weeks later.

According to Jason Gonzales, investigations manager for Rite Aid’s Western U.S. region, “LAAORCA has helped to pave the way of cooperation at many levels. Many companies that are competitors are now working joint investigations and communicate regularly. The relationships that have been established through this process are phenomenal.”

Competitors now routinely fight common problems with LAAORCA’s help, according to George Torres, ORC manager for CVS/pharmacy. “CVS has worked closely with our competitors to combat ORC,” explains Torres. “Recently, with the support of LAAORCA, an overnight burglary crew was apprehended that specifically targeted pharmacy and front store product that affected CVS, Rite Aid, and Walgreens throughout California.”

While co-chaired by Captain Williams of the LAPD and CVS’ Torres, and with Detective Oda acting as its primary coordinator, LAAORCA is much more than just an police department program. Currently, LAAORCA boasts a membership of over 850 individuals representing 170 different retailers and over seventy law enforcement agencies…not all of them in the Los Angeles basin. It’s a massive partnership on a large scale, which is why Captain Williams believes it is so effective.

“Organized retail crime is not just a city of LA problem; it is a regional, national, and international problem,” explains Williams. “The synergy developed by the various law enforcement and retail partners working together is essential and a significant weapon to help defend and fight this scourge called ORC.”

When you’re dealing with criminals who conduct operations nationwide, a very long reach is necessary. Individual retailers have also gone to great lengths to participate and allow their personnel to fully integrate into the model. Take CVS/pharmacy as an example. “Our director of corporate investigations, Jim Lynch, and our national manager of organized retail crime have allowed me the latitude to represent LAAORCA,” says Torres.

LAAORCA is a model for fighting organized retail crime and has spawned several similar law enforcement partnerships like it across the country, including

  • BAORCA—Bay Area Organized Retail Crime Association,
  • CCROC—Cook County Regional Organized Crime task force,
  • SDORCA—San Diego Organized Retail Crime Alliance, and
  • SNORCA—Southern Nevada Organized Retail Crime Association.

LAAORCA’s success has recently been recognized nationally as Captain Williams and Detective Oda were named two of “2011’s Most Influential People in Security” by Security magazine, which is a highly coveted honor among security professionals.

LAPD’s Mission Control

LAAORCA brings some big guns to bear on organized retail crime, and due to the size and power of its charter member, the Los Angeles Police Department, the organization has some capabilities not currently extant in other such partnerships.

ORACRne of these key capabilities is RACR, the Realtime Analysis Critical Response Division and LAPD’s mission control. A casual stroll through the facility leaves one in amazement. Like something straight out of an international spy thriller, RACR boasts a large central room filled with desks and computers, all facing a towering screen that feeds news and information from all over Los Angeles and the nation. Both climate-controlled and hardened, the facility is staffed by as many as forty personnel during surge operations, all the while manned 24 hours-a-day, 7 days-a-week, year round.

RACRs primary function is to receive intelligence and be the primary resource center for the deployment of department resources from individual personnel all the way up to entire divisions. RACR is immediately available to LAAORCA for the rapid receipt and dissemination of real-time organized retail crime occurrences, making LAPD’s response lightning fast.

RACR also boasts a staff of dedicated detectives who aren’t assigned case loads so they can respond to requests for service 24/7, transforming LAAORCA into a fast-moving organization that effectively never sleeps.

As crime occurs, LAAORCA and its retail partners can immediately track crime trends. A group of criminals that was previously stealing from numerous retail chains at once is now suddenly linked to all of the chains in an instant, allowing the descriptions of the individuals, their methods, and any other pertinent information to be immediately disseminated to the entire membership in seconds.

The Retailer’s Perspective

LAAORCA provides retailers with an unprecedented opportunity to share information among themselves and also have a voice inside one of the largest law enforcement agencies in the country. Prior to the formation of LAAORCA, information was often only shared vertically, that is, between the individual retailer and the law enforcement agency they were contacting to file crime reports or request service. Unless that agency decided to share the information with another retailer, that vertical pipeline remained intact and unbroken. LAAORCA adds a new pipeline, a horizontal one, in which information can be shared with retailers as well. There are two primary methods by which this occurs.

The first method is LAAORCA’s proprietary database, with a membership of 850-plus members who are thoroughly vetted beforehand. These members are comprised of retail loss prevention professionals as well as law enforcement agents from a variety of agencies. The database is a forum where retailers can share information such as surveillance photos and videos, criminal methodology, and crime events so that law enforcement can more easily be aware of emerging crime trends.

The time savings to loss prevention professionals is unparalleled. A store loss prevention agent can literally upload a photo or description of a suspect and other retailers will have the same photo potentially moments after the crime has occurred so they too can watch out for the suspect. “As a registered member, you can submit an incident, which is then shared via email with other members of LAAORCA,” says Rite Aid’s Jason Gonzales. “Your contact information is also available should any LAAORCA members want to discuss the matter further. This also allows others to establish if other law enforcement or retailers have experienced similar occurrences.”

Secondly, LAAORCA holds general meetings every six weeks. Attended by as many as 130 people, these meetings are an interactive way to disseminate information and have individual retailers warn each other of organized retail crime happenings. The meetings are highly structured, usually beginning with a 15- to 20-minute education piece on a particular crime, followed by a 60- to 90-minute investigative portion, in which retailers and law enforcement can compare notes. There are no interruptions and no lunch breaks, ensuring the maximum amount of productivity.

These meetings are so effective that they can even result in the solving of some crimes—many criminals have been identified by other retailers simply by the exchange of information. “At our last meeting,” says Captain Williams, “a retail loss professional member was trying to identify a suspect committing thefts at several locations in the south land and needed help in identifying the suspect. Well, a LAAORCA member in attendance recognized the suspect and was able to help connect the dots for the other member. That happens quite often at our meetings.”

The meetings also encourage lots of retailer cooperation as well, according to Gonzales. “At the conclusion of these meetings, the attendees typically gather and exchange contact information to help foster partnerships relating to ongoing or future investigations.”

Retailers are also noticing that LAAORCA is a breath of fresh air, compared to similar partnerships in the past. “Usually, there is a disproportionate retailer-to-law enforcement ratio with these types of organizations,” says Michael Draper, senior investigations manager for JCPenney. “Because of the influence of Captain Williams and Detective Oda, LAAORCA was able to increase the level of law enforcement participation. As a result, the exchange of intelligence between retailers and law enforcement has greatly improved.”

Additionally, LAAORCA is completely free of charge to the retailers. “LAAORCA is not expensive. There is minimal expense to the LAPD,” explains Captian Williams. “I deploy a detective part time as the coordinator. However, it had to be the right detective. One who is motivated and has the initiative, personality, and experience to do this important job. That is why I assigned the position to Detective Oda.” The veteran detective takes his responsibility seriously. “Retailers can make an appointment with me anytime to discuss their case,” says Oda.

Achieving Significant Results

The efforts of the LAPD in bringing together retailers and law enforcement through LAAORCA is paying off. “As a founding member of the organization, we believe in the program and have benefited from it tremendously,” says JCPenney’s Draper. “LAAORCA is one of the greatest success stories in the fight against organized retail crime”—a strong endorsement. George Torres of CVS concurs. “We are impressed with the organization’s results.”

LAAORCA has generated a flood of tips, intelligence, information, and ultimately, arrests and recovery, some of which are of staggering proportions. Detective Marc Zavala of LAPD’s Commercial Crimes Division, along with his partner, Ricky Hernandez, have participated in a number of high-profile cases. As Zavala describes it, LAAORCA is “someone to tell their [the retailers] problems to.” And LAPD is listening.

Example Number 1. Zavala was tipped off by a LAAORCA member regarding three semitrailers of stolen cosmetics. The store loss prevention agent utilized the LAAORCA connection to get in touch with Zavala. Interestingly, the trailers were stolen from stores in Utah, demonstrating LAAORCA’s nationwide reach. The retailer recognized some of the stolen product on the Internet, where it was in the process of being e-fenced.

Detective Zavala and his partner tracked the product back to the Southgate area of Los Angeles, to a mom-and-pop store. They searched the premises and found that the stolen merchandise was being held in even more locations. The detectives seized over $1,500,000 worth of stolen merchandise. It’s hard to find a better example of the LAAORCA network in action, but Zavala is quick to point out there are many other cases like it.

Example Number 2. Zavala was called by a high-end Beverly Hills retailer who suspected that one of their own employees was stealing product. The employee was shipping stolen merchandise to his cousin, who was fencing the stolen product. The detectives started watching the suspects, ultimately arresting both of them, but in the process uncovered an even deeper network. The cousin of the thief was connected to an elaborate ring of eight other professional shoplifting boosters, who were also arrested. The total amount recovered was over $2,000,000 worth of stolen merchandise and gift cards. The source of the tip? The retailer was a member of LAAORCA, and immediately reported the thefts.

These examples illustrate why retailers are so ecstatic. “We believe this collaborative process is, for the first time in recent memory, putting pressure on the organized retail crime groups, which we hope will lead to less criminal activity,” says Jason Gonzales of Rite Aid.

LAAORCA is a proven model, a melding of real-time intelligence and investigative muscle that’s brought to bear on organized retail crime. It works not simply by the free dissemination of information, but by the fact that a partnership with retailers is a force multiplier for the department. In essence, each of the hundreds of loss prevention agents at each retailer are like an extension of the LAPD itself, and they work together seamlessly to attack organized retail crime.

LAAORCA is busting organized retail crime rings faster than ever in an age where these criminal enterprises are rapidly growing due in part to the sagging economy. Curiously, these thieves either don’t realize or don’t care that rampant theft makes the economy worse for all of us. Thankfully, LAAORCA, the killer whale that never sleeps, watches their every move, patiently waiting for the opportunity to take a significant bite out of organized retail crime.

 

This article was first published in 2011 and updated in January 2016.

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