Seattle police arrested 13 members of an organized retail crime (ORC) ring Tuesday after working with two unnamed retailers’ loss prevention staff to uncover suspects accused of stealing hundreds of dollars’ worth of products including sneakers and jeans.
Elsewhere in the retail supply chain, Chicago police arrested 26-year-old Pedro Caudillo Thursday, charging the UPS driver with stealing more than a dozen boxes containing hundreds of thousands of dollars’ worth of Louis Vuitton merchandise from one of the logistics giant’s distribution centers with plans to offload the goods through social platforms.
Retailers pay a pretty penny as a result of organized retail crime, which averages $720,000 per $1 billion in sales, Jason Major, president of the Carolinas Organized Retail Crime Alliance, wrote in a letter Monday to North Carolina’s Joint Legislative Committee on Justice and Public Safety, the state group considering a new bill aimed at “organized criminal rings that make it their profession to steal.”
From coast to coast, merchants are struggling to combat a rising wave of retail crime.
California crime bill stalls
Over in California, proposed legislation aimed at holding criminals accountable for retail theft ran into a roadblock this week even as two ORC members pleaded guilty to stealing from stores in nine counties.
“Organized retail theft costs businesses, retailers, and consumers—and puts the public at risk,” Attorney General Rob Bonta said in a statement Friday announcing the pleas from Anton Salaam and Marion Paul Tilley, who along with two others stole more than $1 million in jewelry from JCPenney and Sam’s Club.
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“Brazen criminal activity, such as the organized retail theft operation we are taking action against today, will not be tolerated in California,” Bonta added. “As our state’s chief law enforcement officer, I am committed to aggressively pursuing and prosecuting those who break the law. Ending crime is a team effort. I am grateful for Governor Newsom’s commitment to this issue and I applaud the leadership of the CHP and the efforts of all of our law enforcement partners who worked on this case.”
Introduced to the California State Assembly’s committee on public safety in March, AB 2390 seeks to aggregate the value of stolen merchandise taken during one or more acts of shoplifting into a single count or charge, and raise the offense to a felony for values exceeding $950.
The bill aims to amend Proposition 47, which for the past eight years has designated thefts of merchandise valued below $950 as misdemeanors, assessed as single incidents even if they’re part of a pattern or spree. AB 2390 would establish a case-by-case pre-trial diversion program for defendants charged with felony theft to curb recidivism.
The bill stalled in committee on Tuesday without the support it needed to advance.
“More and more Californians are worried about increasing crime,” California State Representative Al Muratsuchi, the Democrat who introduced the bill, wrote in an Orange County Register op-ed published prior to the vote, pointing to a recent UC Berkeley study that found 78 percent of California residents believe crime has worsened. What’s more, 59 percent blamed Prop 47 for the changing conditions in their communities, and want to see the law changed.
Despite supporting criminal justice system reforms, “we cannot ignore the reality of rising crime that is making Californians feel less safe and secure,” Muratsuchi wrote, adding, “we have all seen the viral videos of brazen looting from stores in California.”
The California Retailers Association (CRA), which advised Muratsuchi, wants strong state action against retail theft. CRA president Rachel Michelin said the trade group held “multiple conversations with law enforcement, criminal justice advocates, elected leaders, other business entities” in search of a “balanced approach” to solving retail crime. “Our goal is not to put people in jail,” she said. “Our goal is to get people to stop stealing.”
Michelin believes a “carrot and stick approach” that broadens the classification of felony theft and implements mental health services, addiction treatment, and other forms of state support for pre-trial offenders would help to reduce organized retail crime by addressing the ancillary issues that often drive people to break the law.
“This is an economy where people are stretched thin, where costs are going up, where people feel like their dollar is not going as far as it did before,” Michelin said. “We need to educate them on why this is not the right thing to do, make sure they get treatment and help with some of the root causes for shoplifting while offering other opportunities. We want to make sure there is a consequence for the behavior but we want to make sure that consequence fits the behavior.”
“Diversion programs work,” and have been “proven to be more effective and cost less than incarceration,” Muratsuchi wrote on Monday. “AB 2390 provides the incentive for serial offenders to take advantage of diversion programs and break the cycle of rampant retail theft.”
Unlike AB 1065, which refers to organized retail crimes involving more than one person, the bill in question addresses shoplifting, “where it’s usually just one individual just doing it for their own personal gain,” Michelin said. “Some of these bigger cases are multi-million-dollar cases, and that’s where the Organized Retail Crime Task Forces come into play.” The mass looting of a Nordstrom store in the San Francisco Bay Area town of Walnut Creek last fall is one example, she said.
But AB 2390 works on smaller-scale crimes. Prop. 47’s designation of individual thefts under $950 as misdemeanors punishable by up to six months of incarceration aims to address California’s overflowing prisons. In January 2020, California prisons contained 122,000 people—33 percent more than they were designed to hold, according to the Public Policy Institute of California (PPIC). Individuals convicted of felony theft could be subject to three-year sentences.
PPIC’s 2018 data suggests that Prop. 47 “may have contributed to a rise in larceny thefts, which increased by roughly 9 percent” over its first four years. Data PPIC published in January showed that property crimes such as larceny increased in Los Angeles, Oakland, San Diego, and San Francisco by an average of 7 percent between 2020 and 2021 while property crimes sank to a 60-year low in 2020.
Michelin believes the misdemeanor reclassification suggests California is lax on low-level crimes. “There’s this cycle where retailers say they call law enforcement” to respond to a crime, and “law enforcement doesn’t always show up because they say the district attorneys won’t prosecute,” she said.
Despite this week’s vote, Michelin believes AB 2390 is critical to reversing the fallout from Prop. 47 and said CRA will continue working with Muratsuchi to revise the bill. “We don’t typically work in the realm of public safety and criminal justice reform,” she said. “But this is such an important issue that we’re going to continue to try to figure out a pathway forward.”
California’s State Legislature adjourns at the end of August, and CRA wants the bill to go up for another vote. “We’re going to continue those conversations” in the coming months, Michelin said. “We have plenty of runway to still try to find a solution to this problem.”
Additional reporting by Jessica Binns.