Retailers intensify investment in technology to tackle organized theft, violence

ORC & Increased Aggression Link Continues to Get Media Coverage

Retailers are reporting an uptick in violence linked to organized retail crime so they are increasing investments in technological solutions and strengthening collaborations with law enforcement agencies, according to experts.

Organized retail crime, which involves multiple perpetrators stealing from stores and distribution operations, threatens retailers' margins. Home Depot Inc., for example, said a rise in organized retail crime increased shrinkage and was partially responsible for a 31 basis point drop in its gross margin year-over-year in the third quarter of fiscal 2019.

The ongoing problem cost retailers an average loss of over $703,320 per $1 billion in sales in 2019, making it the fourth consecutive year of losses coming in above $700,000, according to the National Retail Federation, or NRF.

In addition to the financial cost, the issue also has safety implications. Sixty-eight percent of retailers reported a rise in violence by organized retail crime offenders in 2019, according to the NRF survey. That is up from 49% of retailers in 2018. In some instances, these groups attack people in stores and use weapons such as stun guns, NRF's Vice President of Loss Prevention Bob Moraca said in an interview.

Several state laws have increased the dollar amount of stolen goods that counts as a felony, which is contributing to the organized crime problem, experts explained. The change allows perpetrators to steal higher-valued goods without the risk of a felony charge. Meanwhile, the ease of selling stolen goods online and the opioid crisis are exacerbating the situation, according to experts.

Deploying technology

To fight the problem, retailers are utilizing different strategies including investing in technological solutions such as radio-frequency identification tags in stores, and GPS to track cargo in transit, according to Dr. Read Hayes, director of Loss Prevention Research Council, an organization that works with more than 70 retailers, including Walmart Inc., and Home Depot.

"There's a lot of [research and development] and evaluation going on in [finding] better ways to protect merchandise in the stores," Hayes said.

Retailers are also improving their surveillance systems to aid their loss prevention efforts, NRF's Moraca said.

"Every good retailer out there worth their weight now has [an] excellent digital video system," Moraca said, adding that the surveillance systems now have some artificial intelligence components that can detect unusual movements and send video clips alerting the retailers' loss prevention teams. spglobal.com
 

On "Fox & Friends" Today
New York's New No-Cash Bail Law Under Fire
Released Bank Robber Robs Another Bank One Day After Release
A New York sheriff reacted on Monday to a suspected serial bank robber allegedly robbing a bank the day after he was released from jail under a newly enacted bail reform law.

Suffolk County Sheriff Errol Toulon Jr. said on "Fox & Friends" that "one of the most concerning things" about the new measure is that law enforcement has to waste resources to "rearrest" people who are released and commit more crimes. He said the new law puts communities in danger and is "empowering these criminals to actually continue their criminogenic behavior."

Toulon was referring to Gerod Woodberry, who according to the New York Post had been jailed for allegedly robbing Chase banks in several New York City neighborhoods between Dec. 30 and Jan. 8 - and then allegedly robbed a fifth bank on Friday, just one day after his release.

Previously, New York prosecutors would determine whether to make a bail recommendation or agree to have the defendant released on their own recognizance regardless of whether the alleged crime was a felony or misdemeanor, and then the judge would make a determination. Defense attorneys would typically make arguments that bail would be inappropriate, or should be set at a low amount, which judges would take into consideration.

Under the new law, this process no longer takes place for the majority of cases, as courts are now prohibited from setting any monetary bail whatsoever or keeping defendants in custody before trial in almost every type of misdemeanor case, and for a long list of felonies as well. foxnews.com
 

Asset Protection Effort in the Asian Rim


       

Japan Association of Electric Article Surveillance (JEAS)
Visiting China Shop Qingdao 2019, the largest trade fair in Asia

The eight JEAS members visited the China Shop in Qingdao, the largest trade fair in Asia (850 companies exhibited), on Thursday, November 7, 2019. JEAS members learned remarkable technological advances such as self-checkout, face recognition, smartphone payment method, and image analysis. There were many things at the fair, from which they learnt the basics of "customer first policy" such as remote support by smartphone to improve operational usability. There were 12 EAS and RFID exhibitors at the show venue. 70% of the displayed EAS were AM, 20% were RF, and 10% were RFID. In the afternoon, they toured a shopping mall and supermarket in Qingdao.

On Friday, November 8 (Fri) 2019, JEAS had the first meeting with the CCFA's Assets Protection & Internal Control Committee of China.

(1) The China Assets Protection & Internal Control Committee explained their history in four phases:

  - Initial: Mostly relied on the human tactics and budget was limited
  - Foreign investment opening period: Strengthen with the response by specialized organization, etc.
  - E-commerce period: proactive security activities and cyber security measures
  - Omni-channel period: Responsible for total risk management including internal control.

(2) JEAS learnt a very interesting story, such as the concept and management plan for damage prevention in the retail industry.

(3) JEAS explained to the China Committee that LP Professor, Dr. Read Hayes' book is published in Japan. The Chinese Committee said that Chinese version of the book was also needed.

(4) In commemoration of this meeting, the LP Manual prepared by the China Committee was provided to the Japan LP Education System Development Committee and JEAS.

(5) At the conclusion of the meeting, JEAS was invited to the General Assembly of the China Committee in July 2020.

(6) This meeting was introduced on the website of the China Shop organizer.


Click here to see more

U.S. consumers more excited than others about facial recognition systems in retail outlets
Almost half of U.S. consumers surveyed in a new report say they are "excited" about retailers using face biometric technologies to tailor their in-store shopping. About a third of respondents, however, said they do not feel the love.

The findings are part of "From 'Bricks to Clicks': Navigating the Retail Revolution," a report paid for by SOTI Inc., a mobility and Internet-of-things vendor. The report, compiled by Arlington Research, compares consumer sentiment about a range of technology developments in the United States, United Kingdom, Germany and Sweden.

U.S. consumers saying they were excited by the prospect of facial recognition used during retail encounters topped out at 48.1 percent. Another 27.8 percent rejected the idea entirely. U.S. open-mindedness is not shared overseas, however.

Half - 50.6 percent - of consumers in the United States told Arlington researchers that they were "very comfortable" using voice-activated assistants to shop. Only 22.6 percent disagreed.

If recent announcements are any indication, makers and buyers of retail biometrics globally are optimistic about deploying the technology. biometricupdate.com

What the CFO's Are Reading:
Workplace Class Actions: The Threat Keeps Growing
The prosecution of workplace class action litigation by the plaintiffs' bar continues to escalate, as it has for more than a decade. Importantly, class actions increasingly pose unique "bet-the-company" risks for employers.

As has become readily apparent in the #MeToo era, an adverse judgment in a class action has the potential to bankrupt a business. Further, adverse publicity can eviscerate a company's market share. Likewise, the ongoing defense of a class action can drain corporate resources long before the case reaches a decision point. cfo.com

What Are the Top Concerns for Boards in 2020?

Their Priorities/Concerns Should be Yours

Preparation for an economic downturn is among the issues that will dominate the attention of corporate boards of directors in 2020, according to law firm Akin Gump Strauss Hauer & Feld's annual look at top board matters.

The list includes a potential economic downturn, board diversity, corporate reputation, pay equity, cybersecurity, and corporate innovation.

Board Diversity: While diversity and inclusion can provide a competitive advantage and enable growth, the proportion of women and minorities serving on boards still doesn't reflect the makeup of the general population, Akin Gump notes.

Corporate Reputation: The Internet has, of course, made it possible for anyone to falsely attack a company's products, brands, leadership, and overall integrity.

Unfortunately, as found by a recent Pew Research study, 45% of Americans today get their news from a single social media platform.

False attacks "can now originate on an obscure electronic bulletin board - and be 'trending' on social media in a matter of hours. From there, Internet news providers, with none of the checks and filters of the mainstream media, can give an online media assault legitimacy that would have been unimaginable a generation ago." cfo.com

Did Trump's phase one deal with China deliver the goods for retailers?
Referred to as phase one, the deal will see the U.S. reduce tariffs on Chinese imports on a wide range of consumer products, including consumer electronics and footwear, from 15 percent to 7.5 percent. For its part, China has agreed to increase imports of agricultural products and other goods and services by an additional $200 billion "based on market conditions" over the next two years.

Groups representing retailers were supportive of the phase one agreement but were clear that more needs to be done.

"The trade war won't be over until all of these tariffs are gone," said Matthew Shay, president and CEO of the National Retail Federation, in a statement. "We are glad to see the phase one deal signed, and resolution of phase two can't come soon enough." retailwire.com

NRF: Growing emphasis on convenience for today's consumers
Today's consumers increasingly prioritize convenience when it comes to purchases, and expect retailers to continue to offer innovative ways to save them time and effort, according to the latest issue of the Consumer View report released today by the National Retail Federation.

According to the report, 83 percent of consumers say convenience while shopping is more important to them now compared with five years ago. While consumers overwhelmingly opt for quality and price in purchasing decisions, convenience offers retailers a competitive advantage. The report found 97 percent of respondents have backed out of a purchase because it was inconvenient for them. nrf.com

Flu Season Is Here: Tips to Minimize Its Impact on Your Office
Flu season is peaking early this year, with many already sick. Ensuring employees understand office sick leave policies and thinking creatively can keep ill staffers at home, healthy workers safe, and your association running smoothly.

While usually done earlier in the season, even at this late date, offering employees a free flu shot helps. "Employees appreciate having that ability to get the flu shot and not have to pay $30 for it," Brennan said.

Employers can also provide some basic education about reducing flu spread. "In the past, when there were really bad flu outbreaks, we would post reminders about handwashing and things like that," Brennan said.

If employees are reluctant to take leave, approach solutions creatively. For example, if someone is coughing a lot-which may be contagious and disruptive, but not preventing them from working-consider allowing unscheduled remote work.

In addition to policies, it's important to create an office culture where people feel it's OK to take off for sickness. "What management does, what coworkers do, is all part of the unwritten behavior in an office that we call culture," Brennan said. "It is really important to work with managers and senior leaders to show it is important to stay out of the workplace when you're sick, especially with something communicable." associationsnow.com
 

Senior LP & AP Jobs Market
 

Ralph Lauren Reposted Today:  VP, Asset Protection, North America on LinkedIn, in Nutley, NJ The Company is seeking a Vice President, Asset Protection based in Nutley, New Jersey . This leader will be passionate about our mission - to serve everyone like family. This simple, passionate mission provides a better shopping experience for our customer, shows respect, value and development for our team, and creates growth for our shareholders. ralphlauren.com

Tony's Finer Foods Posted Director of Loss Prevention in Chicago, IL
● Assure the protection of company assets and execution of all facets of the Store Excellence Program designed to minimize inventory shrink. ● Investigate general liability claims, protect against bad checks and cash losses. Indirect supervision of all Asset Protection Managers by working with the Operations DM/VP for each district. ● Responsible to oversee all investigations & auditing programs to ensure company compliance.
$90k to $110K.  indeed.com

Senior LP Job Postings Removed from Website:

● VP Risk Management - Delaware North - Buffalo, NY
● Dir. Corporate Security - ADT - Boca Raton, FL
● Dir. Internal Audit - Cracker Barrel - Lebanon, TN
● Dir. Security & AP - Rent The Runway - Secaucus, NJ
● Dir. Loss Prevention - Surf Style Retail Management - Hollywood, FL
● Dir. Loss Prevention-ORC - Ulta Beauty - Bolingbrook, IL
● Dir. Enterprise Security - US Cellular - Chicago, IL

 

Enterprise-Wide Risk Management: Bridging Physical and Cyber Protection
According to data from the University of Maryland, hackers attack computers and networks at a "near constant rate" of one attack every 39 seconds. PwC found that companies with over 5,000 employees experienced a meaningful crisis every year. Unfortunately, this is the new normal: today's increasingly digital organizations face a broad range of complex risks, and nobody is immune from an attack.

By 2021, Cybersecurity Ventures predicts that global cybercrime will cost $6 trillion annually. However, the damage goes far beyond the immediate financial impact.

Attacks cause damage to enterprise infrastructure, both in the online and physical worlds, and to third parties such as suppliers and customers. They also attract the attention of government regulators. With these facts in mind, prevention and the preemptive risk management must be top of mind for professionals in every industry sector.

Physical and Cyber Security: Two Sides of the Same Coin securitymagazine.com

Equifax Settles Mega-Breach Lawsuit for $1.38 Billion
The final minimum tab for Equifax's failure to patch a known web application security flaw - that later proved to be the root cause of the company's disastrous data breach in 2017 - is over $1.38 billion.

The US District Court for the Northern District of Georgia Monday granted final approval of a settlement arrived at last July between the Federal Trade Commission and Equifax. Under the settlement, Equifax has agreed to set aside at least $380.5 million to settle claims related to its 2017 breach.

The company has also agreed to spend at least $1 billion on information security and related technologies over a period of five years.

Personal data, including Social Security Numbers belonging to some 147 million US consumers was compromised in the breach. Equifax has blamed the incident on a buggy component in the open-source Apache Struts framework for which a patch was available at the time of the breach. darkreading.com

Belk harnesses AI to manage inventory
Belk Vice President Tim Carney credits AI for Belk's recent (and still improving) mastery of inventory management. While the technology is often touted as a way to spur personalization and marketing, Belk's revamp, which entailed moving from using spreadsheets to SAS' tech, is demonstrating how useful it is in backroom operations. Carney told the NRF audience that the department store integrated machine learning into its ordering, replenishment and allocation systems, including measuring demand for specific sizes by store. "Our virtual assistant does the heavy lifting," he said, noting that some obstacles remain, including the level of willingness among vendors to pack things differently. retaildive.com
 

Cloud Security: Financial Regulators Ripple Effect on Retailers
Concerns About Cloud Security Prompt More Scrutiny from Financial Regulators

Responsibility for data protection remains with the company even if it uses cloud, regulators say

U.S. financial regulators put banks and brokers on notice that a key part of compliance audits will be the scrutiny of how these firms control the information they store in the cloud.

Regardless of any arrangements under models that divide responsibility between cloud users and providers, regulators from federal agencies and industry bodies said at a Financial Industry Regulatory Authority conference Tuesday that they consider the companies themselves liable for any breaches.

"Even if you have identified who has responsibility for what controls, you're still outsourcing your services and your control of that data, and the firm is still going to be responsible," said Salvatore Montemarano, a senior examiner at the Securities and Exchange Commission. wsj.com

Editor's Note: With this declaration it will probably hold true for any public retailer as well at the end of the day.

Four-fifths of SIM-swap fraud attempts successful
Researchers from Princeton University find that despite advances in technology, SIM-swap fraud continues to be difficult to detect and prevent, as fraudsters adapt attack techniques.

The study, An empirical study of wireless carrier authentication for SIM swaps, by Kevin Lee, Ben Kaiser, Jonathan Mayer and Arvind Narayanan, set out from the baseline that the procedures in question were an important line of defence against attackers. These attackers seek to hijack victims' phone numbers by posing as the victim and calling the carrier to request that service be transferred to a SIM card the attacker possesses.

The team noted that SIM-swap attacks allow attackers to intercept calls and messages, impersonate victims, and perform denial-of-service (DoS) attacks, and added that they have been widely used to hack into social media accounts, steal cryptocurrencies, and break into bank accounts.

Princeton examined the types of authentication mechanisms in place for such requests at five US pre-paid carriers - AT&T, T-Mobile, Tracfone, US Mobile, and Verizon Wireless - by signing up for 50 prepaid accounts, 10 with each carrier, and subsequently calling in to request a SIM swap on each account. computerweekly.com

How Wireless Carriers Open the Door to SIM Swapping Attacks

The SIM Swapping Threat

Over the last several years, SIM swapping has become a growing concern. The FBI has highlighted the issue, and the U.S. National Institute of Standards and Technology lists SIM swapping as a major mobile security threat.

These types of attacks can be accomplished in several ways. One is to persuade a carrier's customer service representative to move a phone number to a different SIM card - a swap - or port it to another carrier. In other cases, criminal gangs may work with an employee of a mobile operator, who is then able to bypass security mechanisms and transfer a subscriber's number.

By hijacking the victim's phone, an attacker can then gain access to victims' online services and accounts, because many providers use mobile numbers as part of the authentication process, such as in two-factor authentication.

In November, the U.S. Justice Department charged two Massachusetts men with allegedly running a years-long scheme that used SIM swapping and other hacking techniques to target executives in order to steal more than $550,000 worth of cryptocurrency

In August, Twitter CEO Jack Dorsey's, personal account was compromised and used to send out racist messages. Security analysts believe that the attackers may have used a SIM swapping technique to compromise the account. govinfosecurity.com

Adobe 2019 Holiday Recap Report: $142.5 billion in sales
during Nov. & Dec. 2019, up 13.1%
Smartphones drove nearly all (84%) of the online sales growth during the period, accounting for 36% of online revenue (up 21% year-over-year) and also accounting for 58% of traffic to retail sites (up 14% year-over-year). However, desktop still led smartphones in rate of completed checkouts per 100 visits, 5.9 vs. 3.

● Cyber Weekend (Thanksgiving to Cyber Monday) produced 20% of overall holiday online sales, up 17.7% year-over-year. Also, Adobe analysis found the week before Thanksgiving experienced strong growth because the retail deals started earlier. The Wednesday before Thanksgiving continues to rival Small Business Saturday with $2.9 billion vs. $3 billion in online revenue, respectively.

● Large retailers grew their online sales by over 65% on average, and smaller ones grew online sales by 35%. Still, online revenue growth during the holidays continues to outpace overall retail growth (13.1% online vs. 4% overall). Consumers collectively spent $2.3 billion per day (on average) across the season. In fact, every day exceeded $1 billion in online sales except for Christmas Eve. This holiday season also had 29 $2 billion days (up from 26 in 2018).

● Buy online, pick up in-store (BOPIS) revenue was up 35% on average for the season. BOPIS hit a peak in the seven days leading up to Christmas, when revenue increased 55%. chainstoreage.com

Another sign of the retail-pocalypse as e-commerce ETF overtakes one that tracks bricks and mortar
As the bad news keeps mounting for the retail industry, a little-noticed measure adds fresh evidence of an exodus away from bricks-and-mortar stores.

In October for the first time, assets in the biggest online retail exchange-traded fund topped those of the largest broad retail ETF. That fund, the SPDR S&P Retail ETF, is made up of companies that do most of their business in the physical, not online, world. As of Thursday, XRT, referring to its ticker symbol, had $236 million in assets, compared with $249 million in the e-commerce-focused fund.

The crossover in assets came just before a holiday season that shaped up to be fairly painful for stores. Shares of Macy's Inc. have been up strongly this week because the company reported losses that weren't as bad as analysts had feared. Victoria's Secret parent L Brands Inc. also reported a big holiday-season loss. Shares of Kohl's Corp. and J.C. Penney Co. are down sharply this year because of fears about their future. marketwatch.com

Amazon lifts FedEx ground delivery ban for sellers