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How online markets may be contributing to organized retail crime

STEVE INSKEEP, HOST:

California prosecutors want to crack down on so-called flash mob robberies. These include highly publicized swarms to raid Nordstroms, the Home Depot and a Louis Vuitton store in San Francisco. NPR's Martin Kaste is asking if the attacks are part of an overall rise in shoplifting.

MARTIN KASTE, BYLINE: Videos of smash-and-grab robberies at high-end stores are all over social media lately. But retailers say the bigger problem is the daily grind of thefts of more mundane merchandise.

(SOUNDBITE OF VIDEO)

UNIDENTIFIED PERSON #1: Look at all that.

KASTE: Such as dozens of bottles of laundry detergent in this video posted last month by WFSB in Connecticut. Outside a grocery store, a team of thieves methodically stacks the bottles into a minivan and an SUV, while employees and customers look on.

(SOUNDBITE OF VIDEO)

UNIDENTIFIED PERSON #2: Can't get a job like the rest of us.

KASTE: But videos do have a way of distorting reality. Theft and larceny crimes have not gone up during the pandemic, according to government statistics. Those don't track the narrower category of retail theft, though, and surveys of retailers show a more mixed picture. One shows losses roughly holding steady; another shows a big jump in recent years, up to $69 billion worth of goods stolen in 2019. But the dollar amounts aside, Rachel Michelin says what's really changed is the degree of organization. She runs the California Retailer's Association.

RACHEL MICHELIN: What we're seeing is coordination, I would say, between these organized retail crime syndicates and kind of gear street gangs. They're going in and saying, hey, we'll pay you 500 bucks if you steal a bunch of merchandise. And then they sell that merchandise to these organized crime rings.

KASTE: But that's not that new, either. Organized retail crime has been around at least as long as Tony Sheppard has been tracking this.

TONY SHEPPARD: I started out actually as a store detective.

KASTE: Sheppard spent years working to prevent theft for companies such as CVS. Now he's with a retail loss prevention software company, ThinkLP. He says theft is being driven by online marketplaces, which have made it easier to offload stolen goods - that plus the pandemic.

SHEPPARD: People who never shopped online before started shopping online by default, even for some of their basic necessities because they didn't want to even go to, like, the essential businesses that were still open.

KASTE: Everyday products such as detergents, razors or teeth whitening strips are now easy to find, often in large quantities, from third-party sellers on Amazon or OfferUp. He says to find the dodgy sellers, you just need to search for certain brand names.

SHEPPARD: Like, say, Mucinex which is - what? - M-U-C-I-N-E-X I believe.

KASTE: And sure enough, on Facebook Marketplace, the keyword Mucinex took us straight to sellers that were offering multiple kinds of household items. One of them even offered different-sized bundles of goods, depending on your needs. Facebook declined to do an interview about this, but via email, a spokesperson said company policy doesn't allow stolen goods. There's no proof that these goods are stolen, and Facebook has a system for reporting such accounts. The spokesperson also said the company would take down those offers of Mucinex since its policy doesn't allow for the sale of over-the-counter drugs. And that got this reaction from Lisa LaBruno.

LISA LABRUNO: So why can't Facebook figure out a way to put a stop gap in their platform that when it says Mucinex, it doesn't even get up there?

KASTE: LaBruno is a former prosecutor. Now she's with the Retail Industry Leaders Association, one of the industry groups complaining about what they see as the indifference of the online marketplaces. Retailers are lobbying for legislation to make the online companies gather more information about high-volume sellers. The tech companies say they don't want to invade sellers' privacy, but some say they could support a version of the bill. Dane Snowden of the Internet Association spoke at a Senate Judiciary Committee hearing last month.

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DANE SNOWDEN: It hurts our reputation as online stores to have this type of activity in our stores, so we want to get it off as fast as we can. And it takes us working with retailers, rights owners and law enforcement.

KASTE: But that last part, the involvement of law enforcement, is a problem. Jon Scholes runs the Downtown Seattle Association, which is trying to revive that city's core after 20 months of pandemic closures and chronic shoplifting.

JON SCHOLES: We're paying for extra police patrols. Individual property owners and retailers are paying for extra security and, in some cases, off-duty police as well. So I don't think there's been a time where the private sector has been spending more on security than right now.

KASTE: For decades, police have solved just a small fraction of theft and larceny crimes nationally. But in some big cities, that clearance rate is now getting close to zero. Police departments have been struggling to keep up their staffing, and with violent crime surging, retail theft has become a low priority. There have been some efforts to disrupt some of the organized retail crime networks, but felony prosecutions are rare, and Scholes says this is a factor, too.

SCHOLES: Well, I think the folks that are engaged in this activity have figured out there's no consequences.

KASTE: And in a downtown that's been hollowed out and feeling fragile, as Scholes puts it, he says that sense of impunity, whether or not it's always justified, is slowing the recovery from the pandemic. Martin Kaste, NPR News.

(SOUNDBITE OF FRAMEWORKS, MURGE'S "CUSP") Transcript provided by NPR, Copyright NPR.