ARLINGTON, VA — October 25, 2007 — The Food Marketing Institute (FMI) praised the House Judiciary Subcommittee on Crime, Terrorism and Homeland Security for spotlighting the national problem of organized retail crime at a hearing today, making a strong case for a law to make it a federal felony for all the members of the sophisticated gangs involved.
"Organized retail crime is one of the most serious threats we face today," said FMI President and CEO Tim Hammonds. "These gangs of thieves steal up to $30 billion in merchandise a year. They endanger public health by adulterating products such as infant formula and cold medicines and selling them to unsuspecting consumers often through illegitimate retail outlets. Law enforcement experts increasingly believe that some of the money earned through this illicit activity helps fund international terrorism."
"Too often," he added, "the gang members who are apprehended are charged with petty shoplifting misdemeanors and receive minimal fines and probation or little jail time. Complicit wholesalers, flea market operators, pawn shops and internet auctioneers cannot be easily prosecuted. A law recognizing organized retail crime under the U.S. Criminal Code would help reduce the billions in retail store losses and, most important, protect the safety of consumers."
Organized retail crime is a growing problem among food retailers. Six in 10 retailers (59.6 percent) reported increases this year, according to FMI’s Supermarket Security and Loss Prevention 2007 report. Companies of all sizes are dedicating more resources to combat the problem, and many large retailers have loss prevention units focusing exclusively on it.
States are victims as well, losing about $1.6 billion each year in sales taxes not collected on transactions involving goods stolen by these organized gangs.
As the leader of the 31-member Coalition Against Organized Retail Crime, FMI has been spearheading efforts to combat this illegal activity for years at the state and federal levels.