Dive Brief:
- In a strong-worded missive to Congressional bigwigs from both parties, a group of 20 retail heavyweights stormed Capitol Hill last Thursday, urging lawmakers to pass the "Transparency and Accountability in Online Marketplaces for Consumers" (TAOMC) Act. This bill, among other measures, would raise the curtains on suspicious online sellers plying their trade on platforms like Amazon, eBay, and the like.
- Heads of powerhouses such as Target, Nordstrom, Neiman Marcus, Levi's, Dick's Sporting Goods, Best Buy, Ulta, Dollar General, CVS Health, and Walgreens, to name a few, signed the letter.
- The proposed bill seeks to amp up legitimacy in the online selling arena by making it trickier for feeble-minded thieves to hawk their swiped merchandise. According to research from the Buy Safe America Coalition, a project by the Retail Industry Leaders Association, the guidelines could give law enforcement the teeth necessary to rein in the pervasive retail theft blighting the nation.
Dive Insight:
Major retail CEOs demand Congress to pass legislation that ensures marketplace transparency, citing concerns over store theft as primary motivation.
Back in 2019, a staggering $68.9 billion worth of merchandise was pilfered from retailers nationwide, pre-pandemic and pre-the current surge of coordinated store heists. This revelation comes courtesy of Buy Safe America. Now, a hefty 67% of asset protection managers at major retailers claim a "significant increase" in organized retail crime, with even more expecting matters to worsen, according to the coalition's findings.
High-profile organized thefts have been making headlines, such as a high-octane smash-and-grab robbery at the Nordstrom outlet in San Mateo, CA. Shortly after the incident, several retailers, including Nordstrom, slashed their operating hours as a precautionary measure to safeguard customers, employees, and inventory – a defense strategy reported by the San Jose Mercury News.
California's Attorney General, Rob Bonta, made headlines recently by sentencing "multiple defendants" for last year's grand theft of $8 million worth of goods from CVS, Target, and Walgreens. However, some thieves don't limit their ill-gotten gains to the street or flea markets. With modern sticky-fingered offenders, the last refuge for their swag might just be online.
Michael Hanson, RILA's senior executive vice president of public affairs, elaborated, "With so much stolen consumer merchandise on hand, you're not going to peddle it on the street or in a flea market anymore, given the rules most states have put in. So, the last avenue left is online."
The TAOMC Act aims to introduce stricter policies for online retail marketplaces. If enacted, platform operators would be compelled to "flesh out" high-volume third-party sellers' identities, giving law enforcement the tools needed to track the clandestine circulation of stolen goods – a move predicted to have a deterrent effect on criminal activities.
In a surprising turn of events, online marketplaces Etsy, Mercari, eBay, Poshmark, and Offerup, who earlier expressed opposition to the legislation, have now endorsed the latest iteration, as reported in October. A Walmart spokesperson previously expressed the megastore's full support for the bill as well.
Amazon, reacting to the ruckus, announced support for the House version of the bill while refraining from commenting on alleged connections between retail crime's resurgence and the increase in online sales. According to a company representative, "Amazon does not allow third-party sellers to list stolen goods in our marketplace, and we collaborate closely with law enforcement, retailers, and brands to outwit and penalize dishonest actors."
It's worth noting that thieves often capitalize on occasions of opportunity. Steven Russ, a retail security consultant, weighed in, "Thieves snatch what's easiest to steal, where and when it's easiest to get away with it. However, the availability of anonymous online marketplaces provides effortless ways for crooks to offload their loot." Indeed, the law enforcement community is quick to identify the role of these hidden platforms in boosting organized retail crime. Buy Safe America warns in its report, "Professionals in the field recognize the convenience of these online marketplaces as avenues to fence goods, while poor economic conditions and employee dissatisfaction exacerbate the situation."
- The retail heavyweights' missive to Congress requested the passing of the TAOMC Act, which aims to enhance the legitimacy of online selling and combat retail theft.
- The TAOMC Act proposes stricter policies for online retail marketplaces, requiring platform operators to verify high-volume third-party sellers' identities.
- With the increase in organized retail crime, seen in the $68.9 billion worth of merchandise stolen in 2019, law enforcement faces challenges tracking stolen goods.
- The circulation of stolen goods online is a concern for law enforcement, as it provides an anonymous avenue for criminals to offload their loot.
- The law enforcement community has identified online marketplaces as a significant factor in boosting organized retail crime.
- Research shows a significant increase in organized retail crime, with 67% of asset protection managers at major retailers claiming an increase in such activities.
- High-profile organized thefts, such as the high-octane smash-and-grab robbery at the Nordstrom outlet in San Mateo, have made headlines recently.
- The policy and law sectors are working together to address the issue of organized retail crime, with the TAOMC Act being a key piece of legislation.
- The rise in online sales has been observed alongside the resurgence of retail crime, prompting discussions about the role of e-commerce in this phenomenon.
