The headlines from the last months are telling:
In Arizona, two people were arrested after a multi-agency investigation into a $2.3 million retail theft ring.
Eight people were sentenced for stealing $1.7 million of high-end goods in what California Attorney General Rob Bonta called “a dangerous, coordinated scheme.”
A Tennessee man was charged with stealing nearly $475,000 in electronics and reselling them online.
These are just a sampling of the arrests and investigations into organized retail crime nationwide. Solving the multi-million-dollar problem will require retailers, online marketplaces and law enforcement to coordinate efforts.
Institutions such as eBay, where I lead the North American Criminal and Regulatory Investigations team, have made real strides in addressing organized retail crime, but without action from the federal government, our efforts can only address a fraction of the issue.
Organized retail crime is not simple petty theft but involves sophisticated criminal organizations with multiple layers designed to evade law enforcement. Bad actors steal millions of dollars in merchandise from retailers to resell it online or on the black market.
Both retailers and consumers, who face higher prices to cover losses and additional security measures, pay for organized retail crime.
But the costs extend beyond the economic. In 2022, 81 percent of retailers said organized retail crime perpetrators had grown more violent over the previous year, according to a poll from the National Retail Federation. The next year, 67 percent said offenders had become even more violent.
Moreover, some of the criminal groups associated with organized retail crime also partake in narcotics and human trafficking.
The size and scale of the problem explain why eBay has invested billions in making our platform safer. Advanced AI tools and highly trained inspectors constantly monitor our listings to identify and remove potentially stolen or prohibited items. Thanks to these efforts, 99.2 percent of prohibited item violations were blocked last year before ever appearing on eBay.
Additionally, my team proudly partners with retailers and law enforcement agents nationwide to investigate and prosecute these cases. Our work with CVS helped prevent an estimated $50 million from being stolen from the pharmacies last year.
This week, the Western States Organized Retail Crime Alliance is holding its annual conference at the eBay campus in Salt Lake City — the first time an ecommerce company has ever hosted such an event. This gathering has brought together loss prevention executives from leading national retailers, law enforcement officials from across the western U.S., and prosecutors who are increasingly prioritizing the fight against organized retail crime.
The conference has been a goldmine of ideas and criminals’ worst nightmare, with professionals exchanging best practices, building new connections, and even sharing tips on active investigations. A keynote speech from Utah Attorney General Sean Reyes confirmed what we have been seeing as those of us in attendance have investigated organized retail crime cases — this is no longer a secondary crime.
Attorneys general across the nation are putting real resources into stopping these crime rings, starting task forces, partnering with retailers, and working with companies like eBay to fight back. In California, for instance, Gov. Gavin Newsom (D) signed a new law last month that makes it easier to prosecute these cases and enforce existing laws.
Now, it’s time for the federal government to step up as well. Fortunately, Sens. Chuck Grassley (R-Iowa) and Catherine Cortez Masto (D-Nev.) have introduced the Combating Organized Retail Crime Act, which would go a long way toward ending these activities.
If passed, the law would launch a Center to Combat Organized Retail Crime at Homeland Security Investigations. The new center would bring together representatives from industry and state and local law enforcement agents. The bipartisan law would also establish new tools to help in federal investigation and prosecution.
We all lose from organized retail crime, whether it’s through paying higher prices, needing to ask for help to buy baby formula kept behind a lock and key or the loss of tax revenue. Passing the Combating Organized Retail Crime Act would be a win and an important step in stemming this growing problem.
Christian Hardman leads eBay’s North America Criminal and Regulatory Investigations team.