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August 29, 2014

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Another Target Stores Data Breach - Hacking Crew Figured Out Target's Red Card Sequencing System - Hundreds of Customers Impacted for $200K+  Postal inspectors served two search warrants in Stockton, California, Thursday seizing everything from computers inside the homes to the contents of vehicles outside. The search warrant affidavit details a sophisticated scheme to obtain Target Red Card holder's credit card numbers. Suspect Boone B. Khoonsrivong was tracked down in April. He allegedly told investigators he had a degree in computer science and had figured out Target's credit card sequencing system, which allowed him to make counterfeit cards. The cards were used to buy at least $200,000 in merchandise and may have compromised hundreds of customer's accounts. The scheme was first detected back in January at about the same time Target suffered a massive breach of credit card security potentially affecting millions of cards. Postal inspector Jeff Fitch said it's "too soon to tell" if the two cases are connected. (Source

Protecting Customers’ Civil Rights

"Racial Profiling Will Not Be Tolerated in New York State"

By: Eric T. Schneiderman 
New York State Attorney General

When stores open their doors to customers, they are inviting all members of the public to come in and spend their hard-earned money. But when those retailers treat certain customers with suspicion solely because of the color of their skin, they are sending a very different message - and breaking the law.
That’s the reason my office has focused on combating retail profiling, which led to a $650,000 settlement with Macy’s to resolve our investigation into more than a dozen complaints of unlawful racial profiling and false detention.

Fifty years after the landmark Civil Rights Act of 1964, there is no place for bias or discrimination in New York. So when my office’s Civil Rights Bureau received complaints that minority customers were being unfairly targeted by Macy’s employees, we took those accusations very seriously. Nearly two dozen African-American, Latino and other customers at the Macy’s flagship store in Herald Square claimed that loss prevention personnel had apprehended and detained them, though they had done nothing wrong. Customers who did not speak English were not allowed to make phone calls after being accused of credit card fraud or shoplifting, or given access to an interpreter.

During our investigation, former Macy’s employees reported that loss prevention personnel tracked and followed African-American, Latino and other minority customers far more frequently than white customers. These policies violate the Civil Rights Act, which prohibits discrimination on the basis of race, color, religion, sex or national origin in public accommodations. And when it comes to profiling, Macy’s was a repeat offender.

In 2005, Macy’s entered into a consent decree with the attorney general’s office after it was found to have violated anti-bias laws, even going so far as to handcuff customers accused of shoplifting. But those practices resurfaced, demonstrating entrenched discrimination. Now, a decade later, Macy’s is learning all over again that racial profiling and other discriminatory practices will not be tolerated.
After an investigation by my Civil Rights Bureau, Macy’s resolved the matter by paying $650,000 in costs, fees and penalties; agreeing to oversight by an independent monitor who will report to my office for the next three years; adopting new policies on anti-profiling and loss prevention detention; training employees on proper investigatory and interview tactics and respect in the event they do detain a customer; and posting a Customers’ Bill of Rights, in English and Spanish, in all 42 Macy’s outlets in New York.

This agreement will secure some measure of justice for Macy’s customers who were victimized and help ensure that, going forward, their civil rights will be protected. But unfortunately, Macy’s is not the only major New York store with a profiling problem. Just a few weeks ago, Barneys New York entered into an agreement with my office after falsely accusing two African-American customers of credit card fraud. Barneys was found to have imposed excessive surveillance on African-American customers, followed them around the store - even frequent patrons - improperly and disproportionately demanded copies of their receipts from sales associates and disproportionately questioned sales associates about minority customers’ transactions.

Barneys resolved our investigation by paying $525,000 in costs and penalties and agreed to develop anti-profiling and anti-discrimination policies, retrain employees and submit to oversight by an independent anti-profiling consultant. These cases are part of an ongoing initiative by my office to combat profiling at retail establishments statewide. It is shocking that, in 2014, retailers still feel they can discriminate against certain customers with impunity. With these two prominent stores now undertaking corrective action, it should send a strong message that racial profiling is unacceptable in New York—and that those who flout the law will pay the price. My office is committed to protecting everyone in New York from discrimination and ensuring equal justice under law for all.



Russia Views Hackers as National Resource - Two Rules: Attack Outside Russia & Be Willing To Attack Other Governments  Russian hackers operate within a grey area in which cybercrime is ignored as long as it occurs outside the country and the hackers are willing to conduct government-sponsored campaigns when asked, Kellermann said. Russians are more intelligent than Americans," Tom Kellermann, chief cyber-security officer for Trend Micro, said. "They're more intelligent because they think through every action they take to a point where it's incredibly strategic. "They're operating at eight to 12 steps ahead on both the offensive and defensive side of the (chess) board." (Source

Organized car-theft gangs target “soft” rental facilities  Car theft is a fruitful field of opportunity for today’s criminals as they seek new and innovative ways for gaining quick profits. Recent reports indicate that prior to committing theft, organized car-theft gangs are doing their homework. They are targeting specific car rental facilities, conducting exhaustive site-studies of the facilities to identify vulnerabilities that will make their job easier. The gangs often use border crossings as easy exit routes to their markets south of the US border. This relative ease of vehicle disposal provides considerable profit opportunity because buyers with plenty of money are not hard to find south of the border and they have appetite for top-of-the-line vehicles. (Source

Dollar General 'firmly committed' to acquiring Family Dollar

Fred's to close 60 stores, accelerate pharmacy acquisitions

Real Life Hollywood Heist in Paris: Saudi Prince's Convoy Robbed by 8 Armed Masked Men On Way To Airport  High flying 41 yr-old Prince after A 45-day vacation in Paris, was on his way to his private jet Sunday when 8 thieves hijacked his lead minivan - bodyguard and attendant still inside. Making off with $335,000 in cash and sensitive documents. The police said the seamlessness of the robbery suggested that it was an inside job and that Prince Abdul Aziz may have been betrayed by someone in his large entourage. Antoine Basbous, an expert on Saudi Arabia, said that Saudi princes often traveled with suitcases filled with cash, which they used to pay their phalanx of assistants and for luxury items or services in exclusive venues where credit is not always accepted. Concerns are growing in the French capital that a recent spate of carjackings could deter Arab billionaires and their families from visiting. The police said summer was an attractive time for thieves, since Paris was flooded with moneyed tourists from the Middle East, Russia and China, some of whom offer cash in exchange for discounts on items like diamonds and designer dresses. (Source

LP Solution Provider Wins Award for Most Innovative Software in Retail - Detects Un-Scanned Items at Checkout  This year’s Retail Solution Providers Association (RSPA) award for Most Innovative Software across the retail industry has gone to a company focusing specifically on Loss Prevention. Malay Kundu, Founder and CEO of StopLift Checkout Vision Systems, has won the Innovative Solution Award for the Best Software Application at the Innovation Solution Awards sponsored by the RSPA. Kundu’s company StopLift created ScanItAll, which detects all unscanned items at the checkout, the Achilles heel of retailers and supermarkets and an estimated $14 billion annual cause of shrink. Until now, there was no way to track unscanned items, because there was no data trail. The company has detected close to one million scan avoidance incidents. (Source StopLift)

LP Foundation awards 12 Military Students LP Scholarships  The Loss Prevention Foundation (LPF) today awarded 12 American Military University (AMU) students scholarships designed to benefit veterans enrolled in AMU programs related to retail loss prevention and asset protection. (Source

Quarterly Same Store Sales Results

Big Lots Q2 up 1.7% with net sales up 1.2%
Books-A-Million Q2 up 0.1% with revenue down 0.5%
Fred's Q2 down 0.1% with sales up 2%

In observance of Labor Day, the Daily will not be publishing on Monday, Sept. 1. We will resume publishing Tuesday. Enjoy your holiday weekend!

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Leading the way with higher education – Northern Michigan University

Dan Faketty & Professor Bob Hanson

Dan Faketty, VP of Asset Protection for Bi-Lo Holdings, and Bob Hanson, Professor and LP Coordinator for Northern Michigan University, discuss the importance of education in Loss Prevention and the development of executives throughout their careers. Dan talks about the objectives and initiatives of the NRF’s Education Committee, for which he is acting chairman. While Professor Hanson tells us about the highly successful LP program he’s led at NMU over the years and how it has added value to the industry.

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The NRF's LP Legislative Committee: A National Update" 
Jeff Fulmer, VP of LP, Barnes & Noble
Jon Gold, VP, Supply Chain & Customs Policy, NRF

LPNN Quick Take #13

In this LPNN Quick Take, hear from Joe LaRocca and Co-MC Ed Wolfe, VP Business Development Manager for WG Security Products. Listen in as Co-MC Ed Wolfe, who has many years in the retail industry; speaks about working with service providers and WG. He discusses what makes WG different. Ed also gives his take on the future and what WG will be working on. Lastly, Ed offers his advice to someone considering going into a different line of work in retail.


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Vicki Cantrell and Robert Moraca from the NRF

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Complying With PCI Standards and Protecting Consumer Data Takes a Token Effort  As hackers devise new and better ways to pilfer consumer data, how do retailers stay one step ahead of the bad guys? A key way to do that, which is gaining support from retailers and payment processors, is tokenization. Like a subway token, a “token” used for online payments is not actually currency, so it can’t be used for any other purpose. Technology is used to create a random token representing the credit card number. If hackers accessed it, the token would have no value to them because they couldn’t convert it back to the actual card number. A token system protects the consumer, while limiting exposure for the merchant and ecommerce providers since credit cards no longer have to be stored in ecommerce and enterprise resource planning (ERP) or order management system (OMS) databases. (Source

Almost One In Four Shoppers Say E-Payments More Secure Than Cards, Cash  As shoppers consider new ways of making payments, there are dueling emotions at play. First, there’s the excitement and fun associated with something new and flashy. But there’s also the fear of the unknown, especially when it could potentially touch a shopper’s bank account or permit huge fraudulent charges. A security company and a market research firm on Monday (Aug. 25) released a survey exploring global payment fears. The most interesting finding was that 23 percent of global users said that the “most secure way to pay” was using any form electronic money, including BitCoins and PayPal. Noteworthy is that the digital embrace is fairly constant across multiple age groups. The favorite response of the global audience was that the safest route was to just use cash. (Source

Shoppers all over the world are buying more online

New York & Co. now derives 9% of its sales from the web

"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



New England ORC Symposium - Sept. 18

By: Joe LaRocca
VP & Senior Advisor, LP

On September 18 (Thursday), the New England Organized Retail Crime Association (NEORCA) Symposium and Trade Show, will be held in Worcester (Massachusetts), featuring a strong blend of education, networking and career development. This event is well attended by retailers, law enforcement professionals and service provider partners. The educational line-up of speakers this year from CVS Caremark, JC Penney, the Federal Bureau of Investigation, Polk County (FL) Sheriff’s Office, Compass and many more.

In an effort to recognize those individuals within the loss prevention and law enforcement community that have gone above and beyond in the fight against ORC in New England, professionals working within the loss prevention/law enforcement community are being invited to submit nominations for these awards. To download the Nomination Form, click here. It includes a description of each of the awards and instructions for completing and submitting nominations. The deadline for submission is Monday, September 1.

State retail associations play an important role in our industry. Most are on the front lines, dealing with legislative initiatives in the state capital while others have operational committees and conduct regular meetings. The educational content and networking opportunity is a collaborative effort between six host associations:

- Connecticut Retail Merchants Association
- New Hampshire Retail Association
- Retail Association of Maine
- Retailers Association of Massachusetts
- Rhode Island Retail Federation
- Vermont Retail and Grocers Association

This is my favorite regional event of the year - it's fantastic! If you have stores in the New England market, consider this an A-list event. I hope to see you there.



ORC News
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Alabama Woman charged with $10,000 Toy R Us theft  Dothan police recently arrested a woman, charging her with allegedly stealing $10,000 from the Toys R Us department store. Court records show Dothan police investigators arrested Saranda Arnika Bristol, 25, of Lake Street, and charged her with felony first-degree theft of property. Records show police charged Bristol with stealing $10,000 worth of store credit cards on Tuesday. (Source

Kroger Plus card links ex-mailman to stolen credit cards in Columbus, OH  Warning to would-be crooks: Don’t try to rack up Kroger fuel points when you’re buying stuff with a stolen credit card. That’s what apparently led postal investigators to former mail carrier Arlie O. Ruff of Bexley. Ruff, 67, was in U.S. District Court yesterday on charges that he used credit cards from mail stolen along his Galloway and Far West Side route between 2003 and 2009. He pleaded not guilty and was released on his own recognizance. A 2009 search warrant for Ruff’s home says that special agents tracked him down through his Kroger Plus card. Ruff used the card when he bought nearly $7,000 in gas, merchandise and gift cards with several credit cards that he had stolen from customers along his mail route. Special Agent Scott Balfour, public information officer for the Postal Service’s Office of Inspector General, did not provide specifics of why it took five years to charge Ruff. (Source

Two women in Niceville, FL charged in $3,000 shoplifting case  Two women are charged with shoplifting more than $3,000 in merchandise from Walmart in Niceville last week. Christie Lena Chapman and Tracy Lynn Davis are charged with grand theft. The two women walked around the store for an hour and 35 minutes, “continuously” putting merchandise into “back-pack style bags,” as well as into “rubber containers, obtained from Walmart,” the reports said. Davis is also charged with resisting in the recovery of items and resisting an officer without violence. (Source

$3,000 in goods bought with stolen credit card number recovered - 5 arrested in Riverside, CA  Riverside police recovered more than $3,000 in stolen property and arrested five people at a residence Wednesday, Aug. 27, in an investigation into credit card fraud. The department's Metro team served a search warrant in the 8600 block of Indiana Avenue looking for merchandise that had been delivered there after being purchased with a victim's "compromised" American Express card, a news release said. (Source

Man charged with a felony for defrauding The Home Depot store of $3,150 in Wyomissing, PA  Felony charges have been levied against Todd D. Livinghouse, a Laureldale man, for committing multiple instances of fraud at the Home Depot store in Wyomissing. The Home Depot, reported that the suspect had committed nine separate instances of retail theft from the store. Livinghouse took cans of paint from the store, on each day and then passed by manned registers on his way out without paying for the merchandise. Later, on each of those days, either Livinghouse or one of two accomplices walked back into the store and fraudulently returned the items without receipts for store credit in the full amount of the stolen items plus the sales tax. (Source

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Warning from the Jewelers Security Alliance: Beware of Overnight Burglaries during the Labor Day Holiday Weekend!  Burglary gangs like to hit jewelry stores over long, holiday weekends. Review your burglary protection today by going to the bottom of the homepage of the JSA website for advice on burglary protection.

Masked Men Steal $70K, Shoot Man Outside NE Philly Pathmark Supermarket  Two masked men waited more than an hour outside of a Northeast Philly grocery store Thursday so they could holdup a businessman who was heading to a bank to make a cash deposit. The 37-year-old victim pulled in to the busy Pathmark parking lot at Large Street and Bleigh Avenue just after 6 p.m. to deposit $70,000 at the Citizens Bank branch located inside the supermarket, according to authorities. As soon as he arrived, the suspects pulled their vehicle behind the man's car -- blocking him in the parking space, police said. The armed robbers demand the man's cash and shot him in the right arm before taking off. The gunfire caused a chaotic scene at the busy grocery store, which was filled with dozens of shoppers. The shooting victim is in stable condition, according to police. (Source

Surveillance video released in robbery of $87K from food-distribution center in Fishtown, PA  Philadelphia Police have released surveillance video from the Wednesday robbery of more than $87,000 from a food-distribution center in Fishtown. Police say two assailants knocked on the door of Kawa Trading Corp. shortly after 2 a.m. Wednesday and identified themselves as police. When the owners of the business opened the door, the attackers -- who were wearing hats emblazoned with the word "police" -- forced their way inside. One of them was wearing a badge. At gunpoint, the robbers forced the workers to lay down in an office while they made off with about $87,700 in cash. (Source

Saks Off Fifth employee busted creating fake returns in Palm Beach County  On 10 separate occasions, Stephanie Glad, 35, used copies of legitimate receipts to simulate returns, the report said. She would not return any items at the suburban West Palm Beach store and pocket the return cash. loss prevention officer for the store reviewed the security footage and was able to pinpoint all 10 instances, the report said. The 10 incidents occurred over a one month period starting July 25 and ending Wednesday with her arrest. The total money involved was $1,335.86. (Source

Video shows brazen smash and grab burglary at Newcastle, CA Jewelry store New surveillance video shows four brazen thieves smashing their way into a long-standing Newcastle jewelry store. They stole several watches and caused thousands of dollars in damage. The break-in happened at 2:48 a.m. on August 13. (Source

Police make arrest in Old Saybrook, CT Gun Store theft  After an hour-long standoff Tuesday night, police arrested a 25-year-old man accused of stealing 13 handguns and three high-powered rifles. Police identified 25-year-old Thomas Russo as a suspect and headed to his home. He was taken into custody after a standoff at his house. Officers searched the house and found several firearms and heroin. (Source

Bulging-biceps thief grabs booze from BJ Wholesale in Broward, Palm Beach counties  Buffed-up and bold, the thief is suspected of strolling into at least four stores in Broward and Palm Beach counties in recent weeks and strolling out with armloads of whiskey, vodka, tequila and other bottled liquor during six thefts, according to Broward sheriff's deputies. Police say his method of operation "is always the same," "He never interacts with the clerks. They call out to him, but he keeps walking. Not at a hurried pace." (Source

Grocery Store Burglary suspect crashes into train in Houston

ATF offers $10k reward for info in Greer, SC gun store theft; 18 weapons stolen

Rock Rapids, IA Man Charged With Felony Identity Theft after Traffic Stop

Monroe, NC couple charged in nearly 50 crimes

J.C. Penney employee accused of $600 theft in Monroe, LA

Robberies and Burglaries

Circle K - Yuma, AZ - Armed Robbery
Dollar General - Lafayette, LA - Armed Robbery
EZ Pick - Holyoke, MA - Armed Robbery
High’s Dairy - Smithburg, MD - Armed Robbery
Marathon - Paris, TN - Armed Robbery - suspect arrested
Phillip 66 - Belleville, IL - Burglary - suspect charged
Pit Stop - Littleton, NH - Armed Robbery
P&H Hardware - Floyd, Co, KY - Burglary - couple charged
Valero - Richmond, VA - Armed Robbery
Walgreens - Hammond, IN - Burglary - Mother and son charged
7-Eleven - Hampton, VA - Armed Robbery - suspect charged
7-Eleven - Orlando, FL - Armed Robbery


Vendor Spotlight

Holiday Shopping Season 2014:
Key Days

Traditionally Black Friday - the day that kicks off the holiday shopping season - is the most lucrative day of the year for retailers. While this has remained true over the last decade, other days are poised to knock Black Friday down a few pegs thanks to the internet as well as retailers’ catering to consumer habits. Below you will find a list of important holiday shopping dates, how they did last year, and what they may look like this year.

Thanksgiving Day

Arguably the most contentious of shopping days – with many retailers, employees, customers, and families arguing over when retailers should open, if at all – Thanksgiving has proven that it can contend with the big boys. According to figures from the NRF, nearly one third of shopper who made a purchase over Thanksgiving/Black Friday weekend did so on Thanksgiving Day. E-commerce figures for the weekend also peaked on Thanksgiving, proving that more consumers are reaching for their devices before taking their post-dinner naps. With more customers using e-commerce than ever before, expect Thanksgiving to be one of the busiest shopping days this year.

Black Friday Weekend
Black Friday may be the biggest shopping day of the year, however it is becoming less relevant as the entire weekend becomes more dynamic. This is partly due to some retailers pacing their sales last year, which ended up being a big success. This sales pacing not only helped retailers better manage foot traffic and crowds, but it lead to higher overall sales for the two days following Black Friday. I see more retailers jumping on board the sales pacing trend this year which will help spread sales figures more evenly, ultimately pushing Black Friday Weekend to the forefront.

Cyber Week
Much like Black Friday, Cyber Monday is transforming into a week-long event rather than a single day phenomena. Yes Cyber Monday was still the strongest day of the week last year with online sales breaking the $2 billion mark for the first time in history, but the three days following Cyber Monday each broke the $1 billion mark according to comScore. While Cyber Monday will remain the single largest e-commerce day of the year, the trend towards a Cyber Week will be more noticeable this season.

To see the rest of the important holiday shopping dates, click here.


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Omaha, NE

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Ralph Lauren
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Bi-Lo Holdings
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Why Persistence is Far More Important than Planning  Being persistent and well-prepared will help you tackle life's obstacles more so than planning, claims this Navy SEAL. Plans often need adjusting to make up for extraneous circumstances so being headstrong is a must. (All about execution)

5 Quick Tricks to Boost Your Willpower
We are always on a quest to get as much done as possible in our limited time, but it's key to realize that you can only get so much done through sheer willpower. Willpower is limited so use these tips to give it an extra boost. (Eat some sugar)

Why Saving Work for Tomorrow Doesn't Work  Do you often tell yourself that you'll do something "later" only to find that it still isn't done? Your behavior today is a strong indicator of your behavior tomorrow. To change this behavior and increase productivity, use these tips. (No free time)

What To Do When Your To-Do List Runs You  Keeping details straight at work can feel like you're trekking through thick mud. You sprint from one thing to the next, projects and lists get jumbled together, and by the end of the day you're trying to figure out what you did! (Don't try to do it all)

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Tip of the Day
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Stagnation is the key to failing. Every CEO at failing retailers I've ever spoken to has told me that the number 1 reason for the company's problems was because the employee population had become stagnate and complacent in their jobs and performance. So many complain when new CEO's bring in their new teams and reorganize their companies, but in essence that's the key to reinventing the organization and rebirthing the company. All teams need to be reinvented from time to time merely to give them new energy, new focus, new opportunities. The human condition always forces us to take the easiest path when in reality that path will ultimately lead us to stagnation. Sometimes it's best to take a new path, one that appears to be the hardest, and maybe the most difficult. Because it's always the darkest path where we find the most rewards. Reinvent-Rebirth-Rethink. It begins every Monday!

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Upcoming Events

CCROC Annual Training & Conference
September 4-5, 2014
Oakbrook, IL

ISCPO Conference
September 9-10, 2014
Dallas, TX

RCC Retail LP Conference
September 10-11, 2014
Toronto, ON, Canada

New York Metro ORC Alliance Kickoff Event
September 12, 2014
New York, NY

NE ORC Symposium and Trade Show
September 18, 2014
Worcester, MA

Ohio ORC Retail Crime Symposium
September 19, 2014
Columbus, OH

CLEAR Fifth Annual Training Conference
October 13-16, 2014
San Diego Marriott-Mission Valley, CA

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