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Op-Ed: Congress must cope with organized retail crime when listening to huge tech

Young man use credit card for online shopping payment on laptop computer application or website.

Blue Planet Studio

As the nation navigates through the new normal, retailers will continue to serve our communities across the country. However, retailers are facing an economy that has changed a lot during the pandemic as consumers continue to buy items online in record numbers. This dramatic increase in online shopping is making brick-and-mortar stores even more vulnerable to a problem that's been growing for over a decade: organized retail crime.

Organized retail crime refers to criminal networks that steal bulk goods from stores and sell those goods online. Retailers have long reported costly issues related to organized retail crime, and the Department of Homeland Security recently warned that third-party online marketplaces make piracy easier. This year, amid the pandemic, leading retailers are saying that these networks are becoming even more aggressive, which is compatible with past retail theft in times of economic contraction.

Congress must intervene to protect the security of retail store employees and to ensure that consumers who shop online are not at risk of buying stolen or counterfeit products. And they should focus on eliminating criminals' ability to hide behind anonymous sales accounts on online marketplace platforms.

Critical progress was made last week with Jan Schakowsky's introduction of the Act on Integrity, Notification and Fairness in Online Retail Consumer Markets (INFORM). The INFORM Consumers Act, originally introduced in March by Senators Bill Cassidy and Dick Durbin, would require online marketplaces to verify high-volume third-party identities by providing their government ID, tax ID, bank account information, and Get contact information.

Big tech marketplaces, including Amazon, are still strongly opposed to strict verification and accountability laws that would provide information to consumers and law enforcement agencies and would make it harder for unscrupulous sellers and criminals to benefit from these illegal transactions.

Big tech marketplace platforms have their place in an increasingly diverse and digital economy and connect legitimate sellers – often small businesses – with a large and growing pool of online buyers. However, their growth shouldn't be a golden ticket to criminal rings targeting legitimate businesses and innocent consumers.

Brian Dodge

President of the Retail Industry Leaders Association

Reports show that organized retail crime is increasingly common on Amazon. In 2019, a theft ring was blown up in Washington State for selling millions of dollars of stolen goods on the Amazon platform over a six-year period. In March, it was reported that more than two dozen people were accused of being involved in a crime ring that targeted large retail stores from 2014 to 2019 and sold stolen goods on Amazon.

The dubious claim that scaling makes solving this problem too difficult, too complicated, or too burdensome is unfounded. Big tech marketplace platforms employ some of the most sophisticated data scientists and logistics professionals in the world, and it is clear that the know-how is there to identify and combat these illegitimate sales.

Let's face the facts. The real reason to ignore this problem is undoubtedly the increasing volume of these transactions and the commissions and fees earned each time a stolen, counterfeit or unsafe item is sold on one of these platforms.

Big tech marketplace platforms have their place in an increasingly diverse and digital economy and connect legitimate sellers – often small businesses – with a large and growing pool of online buyers. However, their growth shouldn't be a golden ticket to criminal rings targeting legitimate businesses and innocent consumers.

An important next step and a sign of good faith would be that Big Tech, together with leading retailers, supports the INFORM Consumers Act. Legislators should take the opportunity to ask Amazon CEO Jeff Bezos about his company's role in solving organized retail crime when he appears before the House Justice Subcommittee this week.

The past few months have been a difficult time for all Americans. For our part, retailers and their employees have done everything to ensure that families have access to everything they need to keep their families safe.

Together we have invested billions in training, safety and disinfection measures to protect our employees, customers and the communities that count on us. But this crisis has also highlighted problems that require other industries to do their part. In this case Big Tech has to step on the plate.

– Brian Dodge is the president of the Retail Industry Leaders Association.

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