Inside a Bandit's Brain
Who's stealing from your stores — and why?

From Aug 2013 | By Fred Minnick | 
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Loss prevention is one of the most important — and costly — components of retail. Companies spend millions equipping stores with the best surveillance equipment and theft deterrents, locking away easy-to-grab goods that thieves pocket quicker than security can react. The problem is so pervasive that there's even a reality TV show — "Caught Red Handed" on TruTV — reaching 1.25 million weekly viewers.

Much like the retail executives who seek to protect their investments, "Caught Red Handed" focuses on protecting stores. But lost in all this fortification of retail outlets is the who and why of retail theft.

"People steal for different reasons," says Terrence Shulman, founder and director of the Shulman Center for Compulsive Theft, Spending and Hoarding, which categorizes shoplifters into seven groups: Addictive-compulsive shoplifters who suffer from anger issues; professionals who steal for profit; impoverished people who steal out of economic need; thrill-seekers who shoplift for the rush; drug, alcohol or gambling addicts who steal to support their habit; kleptomaniacs, who steal for no reason at all; and absent-minded people who simply don't know what they're doing.

Of those seven categories, though, it's the professionals that get most of the retail industry's attention.

Organized crime

Organized retail crime syndicates steal for the same reasons as drug-dealing gangs: There's big money in it. ORC costs retailers $30 billion annually, according to NRF's 2013 Organized Retail Crime Survey.

The FBI says retail theft is of great concern because it's a "gateway crime" that leads to larger crime rings "that use the illicit proceeds to fund other crimes — such as organized crime activities, health care fraud, money laundering and potentially even terrorism," says FBI supervisory special agent Eric Ives.

Major ORC syndicates include South American theft groups, subsidiaries of Mexican drug cartels and Cuban and Southern Florida criminal groups. Organized retail criminals work in teams, use hand signals and don't necessarily take high-value items — they simply steal what people want. According to the NRF report, top ORC-targeted items include baby formula, laundry detergent, energy drinks, high-end denim, allergy medications and cell phones. The report also noted that eight in 10 retailers believe ORC activity has increased in some fashion in the past three years.

In 2007, NRF and FBI created the Law Enforcement Retail Partnership Network (LERPNet), a secure national database for the reporting of retail theft and serious incidents to allow companies to share information. NRF has also lobbied to make organized retail crime a federal offense; 28 states have already passed or enacted legislation against organized retail crime. Florida governor Rick Scott recently signed into law a bill that guarantees minimum sentencing period of at least 21 months for convicted retail thieves.

"Retail crime causes retailers to pass losses onto other consumers through higher priced goods, making it harder for businesses and consumers to do business in Florida," Scott said when signing the bill. "This new law continues to fight to keep the cost of living low for the families of our state."

The mental health connection

But what about those other six categories of shoplifters? Professionals are not the only thieves out there, and many cannot control their actions: According to the Diagnostic and Statistical Manual of Mental Disorders, kleptomania is an impulse control disorder, along with pathological gambling and pyromania.

Kleptomania was included in the first edition of the DSM, published in 1952 by the American Psychiatric Association, and has always been considered an extremely serious issue. The DSM says kleptomaniacs have an inability to resist urges to steal, feel an increased tension leading to the theft and sense feelings of pleasure when stealing.

In addition, the psychiatric community has discovered that compulsive thieves suffer from many of the same emotional issues as hoarders. In the book Compulsive Hoarding and Acquiring: Therapist Guide, written by Gail Steketee and Randy O. Frost, the authors suggest kleptomaniacs and hoarders suffer a deep fear of what others think and a heightened sensitivity to criticism.

"Not all people who steal hoard, and not all who hoard steal … but people who steal often hoard the items and have a hard time letting go of the things because of the pain and victory they represent," Shulman says. "Often, too, the items may have symbolic rather than actual value."

Items in a store may actually activate an emotional need to steal: If someone had been abused by a parent, an in-store Mother's or Father's Day promotion might trigger the urge to steal. According to the Mayo Clinic, kleptomania may also be linked to problems with a naturally occurring brain chemical or neurotransmitter called serotonin, which regulates moods and emotions. The Mayo Clinic says stealing causes the release of dopamine (another neurotransmitter) and creates pleasurable feelings.

Shulman says he encourages people with shoplifting problems to avoid stores.

"Often the stealing is a cry for help," he says, "a counterbalance to over-giving and co-dependent behavior, a stress valve, a way of releasing anger and a response to having one's boundaries violated by others."



There are those in the retail industry who do not buy into the theory that psychological issues lead to theft. LPT Security consulting president J. Patrick Murphy has worked in retail his entire career. In the 1980s, working as an LP specialist for Sears, he caught thousands of shoplifters.

"Every single one of them knew exactly what they were doing and that it was both against the law and wrong," Murphy says. "The mental health community wants to shift the emphasis to a set of factors other than the person's own accountability."

Murphy disagrees with the seven categories of shoplifters as well, saying that there are two types: "There's … somebody who happens to be in the store and gets the compulsion for some reason to steal something," he says. "Then there's organized crime."

The National Association for Shoplifting Prevention advocates handling the underlying issues that lead to shoplifting. "It's just like with a person arrested for a DWI," says Barbara Staib, director of communications for the NASP. "The courts send the driver to alcohol treatment courses to take care of the underlying behavior."

As with alcoholics, Staib says, it often takes an arrest and the court system to get a shoplifter into a treatment program. She says shoplifters should never be treated with kid gloves and it's in the retailer's best interest to stop them from stealing. "But putting them in jail just makes them better criminals," she says.


Drawbacks to LP efforts

In most states, special merchant acts allow retailers to detain shoplifters and search them until the police arrive; some states even allow retailers to collect a fine on the spot and pursue a civil lawsuit. But civil rights advocates have questioned the legitimacy of these state laws.

"If a store owner says he'll call the police unless you pay up, that's extortion, that's illegal," New York City community advocate Steven Wong told The New York Times in 2010. "And putting up pictures in public, calling someone a thief who has never even been formally charged, that's a violation of their civil rights."

There's also the possibility of LP tactics backfiring. Murphy was called as a forensic witness in a major retailer civil suit. "The loss prevention team was watching this young lady in the bra department," he says. "She went into the dressing room with four bras. She came out with what they thought was three. They sent an LP person into the dressing room and didn't find an empty hanger."

After the woman put three bras back on the rack, the LP crew detained her, called the police and "made her pull up her dress and show her bra," Murphy says.

The woman sued the retailer and won. Cases like this are rare, Murphy says, stressing the need for retailers to be responsible for their own security instead of relying on local police departments. "If I've got a video of you stealing four pairs of jeans and I call the police and I say, 'Here's the video' … it goes to a detective [with] 500 other cases," he says.

The most underrated retail thieves are employees, Murphy says, and they steal because management lets them. Lack of cash register accountability, policies and procedures about parking and cleaning schedules make the difference in employee theft, he says. "Most retailers have those [policies and procedures]. However, if you have them and you're not enforcing them, employees quickly understand that you are not a manager who is going to enforce policy. That gives them the opportunity.

"There are fewer people who commit employee theft," he says, "but they steal much more than the shoplifters."