Maryland residents have likely seen or read media stories about an alarming rise in organized retail theft. These reports describe how criminal gangs are using online marketplaces to sell items stolen from stores. The basis for many of these media stories was a report released in 2022 by the National Retail Federation. In the report, the retail trade association said organized retail theft cost the industry $45 billion in 2021. The NRE has since retracted the report because the $45 billion figure is incorrect.
Total losses
The NRE now admits that it found the $45 billion figure in a transcript of testimony given by the National Coalition of Law Enforcement and Retail president to a Senate committee in 2021. However, when the COAL president mentioned $45 billion, he was referring to the retail sector’s total losses in 2016 and not the losses caused by organized retail theft in 2021. This means the $45 billion figure includes losses caused by vendor fraud and items being scanned incorrectly or returned fraudulently.
Poor performance
Media stories about organized retail theft led to calls for harsher shoplifting penalties and more aggressive police tactics, but these reports were questioned by many criminal defense attorneys and industry experts. Big-box retailers including Target have blamed store closings on organized theft rings, but some analysts believe the problem is being exaggerated to draw attention away from poor performance. Shoplifting incidents in major American cities increased by 16% between 2019 and mid-2023 according to a report released by the Council on Criminal Justice. When the nonpartisan group did not include data from New York City in its calculations, shoplifting incidents actually fell by 7%.
Inaccurate information
A report released by a major retail trade association in 2021 claimed that organized theft was costing the industry tens of billions of dollars each year. The organization has now retracted the report because it was based on inaccurate information. It remains to be seen whether media outlets will draw as much attention to the retraction as they did to the original claim.