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The D&D Daily Mobile Edition

April 3, 2014

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Spotlight on Leadership
 

Retailing’s new age of asset protection

By Garth Gasse, Director of AP, RILA

The field of retail asset protection — like other aspects of the industry — is undergoing significant change as a host of complex new challenges related to data security and rapidly advancing technology join longstanding challenges related to workplace safety and shrink.

The four broad areas of data security, rapid technological advancement, workplace safety and shrink are requiring retailers to rethink and reengineer significant aspects of their operations in new and inventive ways. Leaders in the asset protection field are playing a much expanded role these days and being called upon to offer a vision of where the industry is headed that lead to the proactive development of strategies which accomplish multiple goals.

For example, asset protection thought leaders must address challenges in a way that ensures all their objectives are met, including those involving shrink, operational effectiveness, and internal controls, all the while ensuring consumer confidence, brand protection and the profitability of the company. Working cross functionally within their organizations and with the Retail Industry Leaders Association (RILA), asset protection professionals are balancing these considerations in four main areas that include:

• Data security: Although cybersecurity is not typically the responsibility of the asset protection or loss prevention departments, AP teams are still focused on the impact of potential security breaches on their enterprises. Recent attacks against retailers and others have understandably focused public attention on cybersecurity and data privacy. Cyber-attacks on retailers are aimed at sensitive consumer financial data that can be used for financial gain, and a breach can affect consumers’ faith in the system and can damage the relationship between retailers and their customers. RILA is committed to aid the retail industry with our recently launched and multi-faceted Cybersecurity Initiative. This initiative, along with RILA’s 2013 research study that identified challenges presented by emerging mobile point of sale (POS) technologies, are just two of the tools RILA provides AP leaders so that they can better protect their companies, their consumers and their communities.

• Technology and innovation: Understanding advancements and applications in new technologies, while maximizing effective use of existing technologies and legacy systems, can be a daunting task. Video surveillance systems, for example, have been used by loss prevention teams for years, but new uses for the data and analytics provided by these systems can also be used in operations and auditing (ensuring compliance with store standards), merchandising (identifying out of stocks), and others. This cross-functional application can also help justify costs and investment in these systems. Innovative AP thought leaders use technology to re-imagine how they operate and produce results. Newly emerging technologies, many developed as solutions outside the AP realm, are also being tested and implemented with retail AP challenges in mind. Facial recognition, predictive analytics, uses of big data, cloud-based applications and a layered CCTV supporting mobile POS are all examples of technologies on the horizon for retail asset protection, and no doubt will soon help retailers maximize profitability.

• The safety imperative: A key responsibility of retail asset protection teams, and one they do not take lightly, is ensuring safety in the workplace and stores. AP professionals realize the primary assets in their companies are their employees, and of course their customers. AP teams must train their teams in such disparate activities as responding to extreme incidents like active shooter events and ensuring safety in daily tasks by instilling proper lifting techniques or the use of personal protection equipment. And new challenges such as training an incoming workforce made up of the millennial generation demand that AP teams develop innovative training programs and new communication techniques. And safety programs are continuing to evolve based on science and technology. Revolutionary brain science research is now being applied to corporate safety awareness programs. Store teams are provided “gamified” eLearning modules to increase awareness and retention. The safety standard and training modules are a fun and repetitive efforts and have a big impact with incident reduction efforts. All these programs require a culture of safety that is only achieved thorough leadership, knowledge and a sound strategy. Driving a safety culture includes empowering executive leadership to embrace safety as a core value and deliver safety awareness and messaging. Achieving safety for employees and customers requires awareness and effort from everyone and approaches like these are having positive results.

• Operational shrink: Shrink management is changing, and many companies are increasing their focus on minimizing non-malicious shrink. Internal and external theft-related losses are significant, and AP teams have traditionally focused on these. But operational or process driven shrink is also impacting the bottom line at alarming rates. This year, a RILA research project currently underway is focused on challenges and opportunities faced by the AP community in engaging other parts of organizations to provide a more holistic approach to shrink prevention. Shrink management is the responsibility of many functional departments beyond AP, such as operations, merchandising, audit, supply chain and many more. If all these stakeholders included shrink awareness in their decision-making efforts, enhanced profitability would result. Several retailers have taken on this challenge and have formed shrink task forces, cross-functional teams with members representing all retail disciplines. Others have established an institutional shrink culture within their company, making shrink management the responsibility of all team members. These efforts are paying tremendous dividends to their shrink and/or profitability results. It is up to the AP leaders to drive the awareness of process driven, operational shrink with our many business partners in our companies.

The asset protection field is changing as rapidly, if not more so, as the rest of the retail industry. It’s why education on the four overarching themes identified above are the focus of RILA’s annual Retail Asset Protection Conference 2014 being held April 6 to 9 in Indianapolis, Indiana. With a program developed by and featuring many of retail’s top asset protection executives, the event is focused on top issues, leading practices and actionable takeaways on the issues that matter most to retail asset protection teams and the retail enterprise as a whole.
(Source retailingtoday.com)
 

News Brief
Sponsored by WG Security Products, Inc.
Washington State debates raising the felony theft threshold; Scott Bringhurst, Vice President of Loss Prevention at Fred Meyer’s spoke on behalf of many retailers fighting the change  The move was supported by public defenders and law enforcement, but it was opposed by a handful of businesses, many of whom were carrying sizable lobbying contracts. Fred Meyer and other retailers have been opponents to any increase to the felony theft level. “Over 2 percent of our sales today are lost to theft,” said Scott Bringhurst, Fred Meyer’s vice president of loss prevention. “If you start adding that onto the slim margins we operate on, at some point in time it does increase the prices that we have to charge our consumers. ...The threat of the felony level prosecution or incarceration is what helps us, we see a great number of thefts within a few dollars of the $500 limit.” The bill, approved by the Senate, had proposed raising the theft threshold to $1,250 to keep up with inflation. (Source newsminer.com)

Kroger, eInfochips showcase 'Retail Site Intelligence' solution at ISC West  While many retailers look to the security industry to provide them with the latest cutting-edge technology, one grocery chain has decided to take an active role in actually helping to develop a new solution that spans both security and store operations. This week at ISC West, global product engineering company eInfochips and The Kroger Co. launched a new enterprise IT architecture dubbed “Retail Site Intelligence” or RSI for short. The introduction of the RSI architecture, which also features its own tailor-made video management system called Vigil360, is the culmination of two years of collaboration between the companies. (Source securityinfowatch.com)

Looking North for chip-and-Pin implementation
One place to look for guidance might be Canada, where cards that both use a chip and require consumers to enter a PIN rather than a signature were rolled out in 2008. Canadian retailers have seen a 30 percent drop in fraud involving counterfeit or stolen cards. The new Canadian chip-and-PIN cards operate under the Europay MasterCard Visa system. As in Canada, EMV is configured to require a PIN in most countries where it is used. But with the EMV cards planned for the United States, it would be up to each card-issuing bank to decide whether to require a PIN or still allow signatures. That has U.S. retailers concerned because they’re being asked to spend $30 billion to replace current equipment and want both chip and PIN to be sure they are offering customers maximum protection before investing that much. Canadian retailers “have seen the benefit of fraud reduction and they are taking advantage of the opportunity to improve their operations,” Myroniw says. Among the features retailers in Canada have coordinated with their conversions are implementation of radio frequency identification, displaying special offers on PIN pads, adding video and audio promotions through point of sale systems and accommodating mobile payments. The big incentive for retailers to make the switch is an October 2015 deadline set by Visa and MasterCard. Beginning then, Visa and MasterCard will require retailers to assume the cost of fraud made on EMV-enabled cards if they do not have the equipment to read the cards, regardless of whether they are PIN cards or signature cards. (Source stores.org)

EMV Migration Forum expects major increase in US chip adoption within a year - "100M or more chip cards & more than double that in terminals"  U.S. EMV chip adoption is poised for exponential growth in the next year resulting from an estimated 17–20 million EMV chip cards and millions of EMV-capable ATMs and POS terminals, the EMV Migration Forum announced at its March meeting. The forum also provided briefings on progress made in addressing technical challenges related to EMV debit implementation, resulting in an industry stakeholder-supported debit technical solution framework, according to forum director Randy Vanderhoof. "Given the commitment and work of our membership and the recent progress in resolving debit challenges, I think in the next year we could see a hundred million or more chip cards issued and more than double the number of installed terminals." (Source retailcustomerexperience.com)

How RFID can enable dynamic pricing for brick and mortar retailers  The next step for retailers seeking to compete with their online cousins is to adopt dynamic pricing strategies that will let retailers like Macy’s and Kohl’s better compete with Amazon’s strategy of changing pricing on items several times a day. One key to enabling dynamic pricing is to find a way for the reader protocol that talks to RFID tags on individual items to also communicate with the electronic shelf labels (ESL) that retailers are deploying as an alternative to price stickers on individual items. Dynamic pricing would allow retailers to change pricing on items instantaneously, based in inventory levels and the pricing of competitors. Eventually, dynamic pricing can be tied into fitting room technologies, where a consumer can be offered a discount if it appears they are about to leave a store without making a purchase. (Source rfid24-7.com)

Saks Fifth Avenue Tweaks $200M to $250M Flagship Renovation Plan

Brookstone seeking Chapter 11 bankruptcy protection as part of $147M sale to Spencer Spirit Holdings

UPS fires 250 walk-out workers who supported long-term employee who had been fired over hours dispute

Cryptocurrency (Bitcoins) mining malware discovered on surveillance DVRs  Cryptocurrency mining malware has been discovered on digital video recorders (DVRs) manufactured for use in the security industry to record footage taken by surveillance cameras. Johannes Ullrich, dean of research with the SANS Technology Institute, posted on Monday that DVRs made by Hikvision, a video surveillance products and solutions supplier headquartered in China, were found to contain malware that mined for Bitcoins. We found one Linux based router that was also affected,” Ullrich said. “The larger picture here is that attackers move away from desktops as exploit targets as there are less vulnerable desktops out there. However, the number of badly protected devices is going up exponentially and they turn out to be very hard to patch and secure compared to desktops.” As of now, the best thing users can do to protect against this sort of attack is change the default password on their systems, Ullrich said. (Source scmagazine.com)

March Same Store Sales Results

Walgreens up 3.5%
Rite Aid up 0.7%

Quarterly Same Store Sales Results

Hudson's Bay Company Q4 up 6.6% with sales up 73.6% due to purchase of Saks Fifth Ave.

 


If you are attending this year’s RILA LP Conference in Indianapolis and are interested in learning how you can participate in LPRC’s R&D, we would like to invite you to attend LPRC’s New Member Orientation to help support us, as we show our newly joined retailer members how to best maximize their LPRC benefits.

Meeting Date: April 9, 2014
Meeting Times: 11:00 PM - 2:00 PM EST
Meeting Location: Room 312 (JW Marriott where RILA is held)

More details to come soon!

Please contact Omar Harris or Corrie Tallman at operations@lpresearch.org for more information.

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Security Resources

Your External Business Partners Series

Joe Malone, co-owner of Security Resources, tells us how his company has grown from a small business in Philadelphia to a national security firm specializing in security guard and investigative solutions throughout North America. Licensed and registered in all 50 states, Security Resources utilizes a partner network of over 700 security companies to address the ever-changing needs of retailers. In this interview, Joe talks about their industry-leading process.

Watch the interview here.

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e-commerce
Sponsored by The Zellman Group
Watch Cyberattacks In Real-Time  IT security firm Kaspersky Lab created an interactive and comprehensive cyber threat real time map that shows a 3D visualization of all the cyber attacks being detected and dealt with by the company’s anti-virus software around the world. The cyber warfare map shows a 3D globe that can spin and rotate with the help of the user’s mouse. The scroll wheel zooms in or out of a specific location. Cyber attacks are shown in different colors based on the type of threat. Clicking on the button on the lower left of the site shows a description of the types of threat. The cyber threat map shows live statistics and a running total of the threats detected. The detection totals reset every day at midnight GMT. The map also shows the top most infected countries. Clicking on a country shows the stats for that country and its rank in the most infected list. Kaspersky Lab’s cyber threat map not only helps provide people, especially the company’s clients, an idea of how their internet security systems work each day, but also provides a look into the extent of cyber attacks around the world. (Source psfk.com)

Cyber Criminals Operate On A Budget, Too
Most cyber attacks today are waged by cost-conscious criminals who mostly repurpose malware and other techniques to get the most bang for their buck, a new study finds. Attackers don't need to write the next Stuxnet or other advanced piece of malware to hit their mark -- about 99 percent of attacks are based on incremental tweaks to existing malware and methods in their attacks, according to a new 2014 Threat Report today. The report analyzed more than 4.1 billion live attacks. Most attackers are using exploit kits today rather than crafting their own malware: The volume of attacks employing these kits is about 1,000 to 1, Renert says. "There's a mass market out there" for tools, he says, and attackers are looking for relatively inexpensive ways to exploit their targets. But the bulk of attacks are really just repurposed versions of the same old, same old. (Source darkreading.com)

GameStop e-commerce grows 21% in 2013

Costco says ‘Hola’ to online shoppers in Mexico

"Fraud is not a person - it is a dynamic grouping of statistics that deviate from the norm."
Stuart B. Levine, CFI, CFCI
CEO, The Zellman Group & Zellman Fraudnet

 

Retail Crime News
Sponsored by Sony

Chicago man admits to $1M Verizon Wireless 1,700 electronic device theft in Fed. Court - Bribing FedEx drivers to deliver to bad addresses  A Chicago man admitted today in federal court in Newark to stealing 1,700 electronic devices from Verizon Wireless, worth more than $1 million, by using an elaborate scheme that featured accessing customer accounts, diverting product-shipments and then bribing Federal Express drivers to get the goods, authorities said. The 1,700 devices he diverted and stole included several hundred Apple iPhones and iPads, Blackberry devices and Motorola phones, authorities said. Court documents show that the crime took place from 2010 to October 2011. Gunn directed that the fraudulently ordered products be shipped via Federal Express to addresses in Texas, including to some addresses that did not exist. Gunn bribed those drivers by paying each of them thousands of dollars, authorities added. (Source nj.com)

Last suspect in $160,000 Walmart fraud case arrested   Charlene Renee Bradsher, 42, of 3523 Greywood Drive, is accused of conspiring to obtain about $159,00 from Walmart under false pretenses and of possessing more than 30 “counterfeit instruments” used to make fake payroll checks, according to arrest warrants. Brasher is accused of using checks, W2 forms, images, signatures, company logo sand bank logos to make “counterfeit payroll checks,” a warrant states. Authorities allege the crimes occurred between July 2013 and January of this year. Alexander was charged last week with embezzling close to $160,000, and police at the time said they were still looking for Bradsher. Arrest reports do not specify whether Bradsher was employed at the Walmart store at 1725 New Hope Church Road at the time of the theft. Bradsher was released Wednesday from the Wake County Detention Center after posting a $25,000 bond. (Source newsobserver.com)

NY & Atlanta men busted with 36 fake credit cards in Hazelton. Pa. after traffic stop  Cagle, who was charged with having 25 fraudulent cards, later admitted to buying access device cards at stores in New York and then modifying the cards with real account numbers owned by individuals, court papers state. He told troopers he bought those numbers from a contact in the Dominican Republic and then admitted to buying counterfeit cash in New York City, arrest papers state. Gordon was found with three access device cards in his wallet and 13 of them in a red metal wallet in a bag on the front passenger seat. (Source standardspeaker.com)

Duo busted using stolen credit cards in multiple states after hitting Target store in Exeter Township, N.J. buying $4,500 in gift cards  Exeter Township police say they have arrested two men who were stealing credit card information, then buying thousands of dollars in merchandise. John Ollaigbe and Ahmed Arogundade appeared in Exeter Township court Wednesday afternoon to waive their preliminary hearing. They are facing access device fraud charges for allegedly using stolen credit card information to purchase $4,500 in gift cards at the Target in Exeter Township. Both suspects allegedly purchased thousands of dollars in gift cards from Target and CVS stores from Wisconsin to New Jersey. "We are still investigating it. It is just like the roots of a tree, it just keeps growing and growing and growing and getting further and further beyond our jurisdiction. That is why we asked for some help from the Secret Service," said Godshall. (Source wfmz.com)

Jared store in Plantation, FL Smash and Grab robbery caught on tape  Four thieves entered the store just before closing, armed with weapons and hammers. The four masked suspects smashed out diamond showcases and fled with over $150,000 in merchandise. No one was injured in the incident. (Source local10.com)

Jo-Ann Fabrics employee uses 36 customers credit cards to buy $8,000 in gift cards in Boston 

Zales in Irving, TX the victim of an $8500 Grab and Run

Jared Store in Brea, CA the victim of a $75, 000 Armed Robbery 

Robber grabs cash at Gander Mountain in Johnstown, PA

Dollar General former employee faces 16 yrs in prison for armed robberies of 4 Dollar General stores & 1 Family Dollar store in North Florida

Walmart shoplifter busted for $3,565 in computer games while on probation for same offence in North Attleboro, MA

String of burglaries at U.S. Cellular stores in North Carolina; stores hit for over $25,000

Denver Police seek two suspects in robbery of Best Buy 

Stop and Shop Shoplifter in NJ nabbed after worker recognized him from Facebook

Niagara Falls man accepts plea deal in $13,000 e-cigarette store burglary

Trio charged after attempt to steal and return merchandise at a Sally Beauty store in Mayfield Hts, OH
 

Robberies and Burglaries

 

ORC News
 
Police looking for men believed to be part of regional shoplifting ring in Hampton Roads, Va.  Police in several area cities are looking for three men believed to be part of a regional shoplifting ring: Kendrick Markiest Alexander, 25, Marquan Tawelle Hoskins, 22, and Antonio Leon Kelly, 21. Police say they stole large amounts of clothing from area stores, amounting to thousands of dollars. Police say in one incident, Alexander made off with 90 pairs of jeans and shirts from the Macy’s at Lynnhaven Mall in Virginia Beach. In James City County, he hit the Belk and Polo Ralph Lauren store. All together, he’s wanted in seven cities and counties, including: Virginia Beach, Chesapeake, James City County, Hampton, Newport News, Henrico County and Chesterfield County. (Source wtkr.com)

Long Island man & Garden City Bloomingdales employee arrested in $117,000 Bloomingdale's fraud scheme  Police say 27-year-old Yorell Moses, of Freeport, cheated the department store out of $117,000 through a scheme involving gift cards, credit cards and returned merchandise. Moses was employed as a sales associate between November 2013 and March 2014, according to detectives, and he allegedly completed transactions for unidentified accomplices that included purchases of merchandise and gift cards with stolen credit card information. Police say Moses would receive Bloomingdale's gift cards of various denominations from the individuals, as well as purchase gift cards for himself at the time of the transactions. Moses allegedly continued to defraud the company by purchasing merchandise with the gift cards from various Bloomingdale's locations, and then returned the merchandise for credit to his Bloomingdale store credit card. He was arrested Tuesday while at work. (Source abclocal.go.com)

Cedar Falls Police look for two women accused of stealing $36,000 in merchandise  A Waterloo woman is accused of using a child to help her steal merchandise from the Cedar Falls Von Maur Store. Amanda Swaggerty is charged with theft in the second degree and using a child in the commission of a crime. Swaggerty, a six-year-old and two other women are accused of stealing more than $36,000 worth of merchandise during the last two months. (Source kwwl.com)

Elko, CA Police arrest woman for burglary, larceny at Big 5 Sporting Goods and Albertson’s  Police arrested a woman on Monday who is suspected of two shoplifting incidents. On March 25, Tessa J. Gomez, 29, of Elko reportedly went into Big 5 Sporting Goods. Employees recognized her because she’d been at the store before, Gomez took a backpack from the store and filled it with items. Then she went to the front of the store and said she wanted to return the items, police said. On Monday, Gomez reportedly went to Albertsons and filled a shopping cart with items. Police did not have a list of the items, but the value of the whole cart was a little more than $1,100. She tried to leave with the shopping cart without paying, and Albertsons employees confronted her. She left the store but was later arrested by Police. (Source elkodaily.com)

Central Marin, CA Police arrest 2 suspects in Abercrombie and Victoria’s Secret thefts

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Vendor Spotlight
 

New Advances in Predictive Crime Risk Analytics Help Retailers Pinpoint Shrink with Unprecedented Accuracy

Using new, advanced Big Data modeling, Location, Inc. has released cutting-edge predictive crime risk analytics in SecurityGauge. SecurityGauge allows retailers to predict and mitigate shrink with new precision and unmatched spatial accuracy. Based upon over a decade of research and development, SecurityGauge has been proven to predict average annual per-store shrink with greater than 94% accuracy.

In separate blind tests performed with leading retailers from diverse retail sectors, SecurityGauge crime risk ratings predict actual per-store shrink with 94%-97% accuracy. These tests show that average annual shrink of high crime risk locations can be more than 3.5 times more than low risk locations. In one test, high crime risk stores experienced greater than $100,000 in additional annual shrink over stores SecurityGauge proactively categorized as low risk. Armed with this knowledge, retailers can precisely and objectively deploy security resources to store locations with higher return on investment.

Accurately predicting shrink on a store-by-store basis is the first step in effective shrink mitigation. SecurityGauge uses new technology with unmatched spatial accuracy to enhance retailers’ capabilities in Loss Prevention and Real Estate:
 

- Choose new store locations based upon shrink predictions at any address.
-
 
Outfit new stores with security infrastructure proportional to anticipated shrink rate at time of construction saving costly retrofitting expenses.
-
 
Make strategic staffing decisions; hire more experienced store managers at high crime risk locations.
-

 
Objectively compare new stores (where historical shrink data is very limited) to established stores for security prioritization; SecurityGauge risk ratings put all stores on a nationally-comparable scale.
-
 
Estimate future store shrink to forecast security expenditures utilizing SecurityGauge crime risk projections.
-

 
Relocate high shrink stores. In some instances, moving just several city blocks can measurably impact shrink. SecurityGauge directs retailers to the lowest shrink risk locations within a desired trade area.

Please visit us to get your FREE SecurityGauge Report at the RILA Asset Protection conference, booth 723 or NRF Loss Prevention conference, booth 1327.

About Location, Inc.
We’re inventors focused on location-based Big Data analytics. Many of our SaaS technologies are patented, patent-pending, exclusive or proprietary, and have been refined over a decade of research and real-world validation. We pride ourselves in methodologies of the highest caliber utilizing a rigorous quality-testing regime to ensure precision at every step. We’d love to hear about your biggest challenges and explore solutions with you.

 

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How to Get Out of Your Own Way on the Path to Success  What's keeping you from achieving that success you have strived for? Many excuses can come up, whether it's not the right time, or you don't think it's a good fit, but you're the only one that can get in your own way. Don't be your own roadblock on the road to success. (Follow these rules)

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3 Emotions at the Root of Success
Those who have great success, tend to feel these three emotions very strongly, and it's no wonder why! These emotions could be the source of success, the key ingredients that, when put together just right, will allow you to reach whatever goal you have. Gratitude, commitment and empathy hold all the answers! (Gratitude=Patience)

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Tip of the Day
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Competition is a good thing because it's what has made America so strong. Whether it's competition between companies or between executives, it has a tendency to bring out the best in most people and in most organizations. It leads to innovation, invention, growth and it instills a sense of competition in everything we do that tends to motivate and challenge people to reach beyond their own self-definitions of what they can do or can't do. Without it, progress, which is slow to begin with, would be stifled but, with it, you have inspiration and purpose. The whole key is how you compete in the open market, whether as a company or as an executive, reflecting professional standards and a code of ethics is critical even when your competition isn't. The #1 rule should always be never speak ill of the competition because in actuality it's more of a reflection of who you are and not who they are.

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Upcoming Events

RILA AP  Conference
April 6-9, 2014
Indianapolis, IN

IOBSE 2014 Spring Conference
April 30 to May 2, 2014
Pleasanton, CA

GRAORCA Retail Crime Conference
May 7, 2014
Atlanta, GA

NRF Loss Prevention Conference & Expo
June 11-13, 2014
Fort Lauderdale, FL

The 35th Annual RLPSA Conference
August 3-6, 2014
Orlando, FL

ISCPO Conference
September 9-10, 2014
Dallas, TX

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