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Saturday, Mar 2, 2024

OpEd: Retail Thievery Is a Menace to Economy

In California, there is a looming threat jeopardizing the safety of our communities, and it poses a significant risk to our business community: retail theft and organized crime. This urgent issue demands attention from our local and state officials to safeguard our retail businesses and the overall well-being of our state’s economy.

California, once synonymous with the three-strike rule, witnessed a transformative shift in its approach to dealing with crime. The elimination of the three-strike rule and the changes brought by Proposition 47, which made stealing less than $950 a misdemeanor, aiming for “fairness” in our justice system, paved the way for a troubling surge in retail theft and organized crime, especially during the Covid-19 pandemic.

Contrary to the idea that economic hardships drive crime, the surge in retail theft has persisted even amid improving economic conditions. Even before the onset of the pandemic, major metropolitan areas in California were experiencing increases in retail theft, with the pandemic further prompting several locales to experience a shocking 700% rise in incidents. In a 2023 Retail Security Survey, data shows an increase in the “shrink rate,” representing the percentage of inventory loss due to factors like theft, escalating from 1.4% in 2021 to 1.6% in 2022, signifying an annual loss of $112 billion for 177 retail brands. What’s further concerning is that in the same survey respondents shared a concerning trend: an increase in the violence accompanying retail theft incidents, with obvious negative impacts on employees, bystanders and businesses.

The nature of retail theft has evolved and is now entrenched by organized crime rings. Large-scale theft events, such as mass shoplifting and smash-and-grab incidents, have become commonplace in California and other parts of the United States. California has three cities in the top 10 for high retail theft, and Los Angeles is No. 1 for the last five years.

This unacceptable trend prompted the Valley Industry and Commerce Association’s support for legislative measures such as Assembly Bill 1613 and Senate Bill 301 during the 2021 and 2022 legislative sessions.

SB 301 looks to protect consumers and third-party resale platforms by imposing unified standards on high-volume sellers and preventing the sale of stolen merchandise, while AB 1613 expands the attorney general’s territorial jurisdiction for prosecuting theft offenses.

While the governor signed these commendable proposals into law, much more is needed regarding comprehensive measures to address the growing menace of retail theft.

And now, most of our elected officials are starting to get the message. Gov. Gavin Newsom’s recent call to create new laws to crack down on professional thieves and bolster police and prosecutor tools is a step in the right direction. State legislators have proposed more than a dozen new anti-theft proposals within the first two weeks of the 2024 session, and we can anticipate more proposals leading up to the February deadline. Additionally, a Select Committee on Retail Theft was created this legislative session and is chaired by Assemblymember Rick Zbur and has Assemblymember Pilar Schiavo – both represent portions of the San Fernando Valley – as part of its committee membership. Their inclusion and leadership within this committee underscores the significance of organized retail crime within Los Angeles County, specifically within local economies that rely on retail businesses. And moving forward, the focus should be on increasing penalties, mandating prosecutorial action and enabling cross-jurisdictional legal action.

Law enforcement agencies are also taking steps to respond to the crisis, with the California Highway Patrol increasing operations by over 310% by tripling CHP resources in Los Angeles County, with an allocation of $267 million to enhance local law enforcement capabilities, resulting in more than 1,000 arrests in the first 11 months of last year.

At the local level, the Retail Theft Task Force, comprising investigators from various law enforcement agencies including police departments in Beverly Hills, Burbank, Glendale and Los Angeles as well as the L.A. County Sheriff’s Department, resulted in 89 arrests and the recovery of more than $370,000 of stolen merchandise within the first five weeks of its inception.

As California steps into the new year, state and local governments must prove to the business community that the Golden State remains a safe and viable place for investment. Elected officials must ensure the enforcement of laws, prosecutors must actively pursue cases and the state and local governments must direct their enforcement agencies to combat these threats to our safety and economy.

Our retail businesses are not expendable, and the lack of safety our retail businesses have creates a detrimental ripple effect that impacts job opportunities and fosters increased illegal activity.

It is time for California to show retail businesses are not an afterthought or not worthy of the protection that they absolutely deserve.

Stuart Waldman is president of the Valley Industry and Commerce Association, a business-advocacy organization based in Van Nuys that represents employers in the San Fernando Valley area at the federal, state and local levels of government.

Hannah Madans Welk
Hannah Madans Welk
Hannah Madans Welk is Interim Editor at the Los Angeles Business Journal and the Inside The Valley. She previously covered real estate for the Los Angeles Business Journal. She has done work with publications including The Orange County Register, The Real Deal and doityourself.com.

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