Because not all shoplifting incidents are reported and because it is often difficult for retailers to understand whether goods are missing due to shoplifting, employee theft, mismanaged inventory, or other reasons, getting a good figure for goods stolen in dollars each year is virtually impossible. Retail groups claim about $1 billion was lost due to retail theft in Colorado last year, while official reported figures are much lower. Whatever the figure is, any stolen merchandise means lost tax revenue for state and local governments, as sales taxes are paid at the point of sale and income taxes are paid on earnings.

For every $1 million in goods stolen, the state loses $29,000 in sales tax revenue and the average local government loses about $78,000. If $1 billion in merchandise was lost in a year in Colorado, that is $29 million in lost state sales tax revenue and $78 million in lost local sales tax revenue. This does not include any lost income tax revenue or potential income tax deductions for theft, which would impact state and federal tax revenue.

Drivers of Shoplifting

Many assumptions but few studies exist on what drives people into shoplifting. It frequently starts when people are under 18 years old and is called by some the “gateway crime” into more serious crimes. Because many shoplifters are not caught or many incidents not reported to law enforcement, there is no good dataset on the total number of crimes, the types of crime, or the offenders; however, the National Association of Shoplifting Prevention estimates that one in 11 people has shoplifted in their lifetime.[7] Many shoplifters also feel that it is a victimless crime that has few penalties if they were to get caught.

A survey of over 43,000 adults was conducted in 2001– 2002 with the National Epidemiologic Survey on Alcohol and Related Conditions (NESARC) to better understand the socioeconomic characteristics and prevalence of antisocial and psychiatric disorders among adults who have shoplifted. Their survey research reports that 11% of the population has shoplifted in their lifetime, roughly corroborating the one in 11 claim. The most indicative factor risk factor for shoplifting is at least one psychiatric diagnosis, with 89% of those surveyed having shoplifting and psychiatric disorder comorbidities.[8] The most prevalent disorders were antisocial personality disorder and substance use disorders.

A similar survey conducted of about 4,000 high school students in 2013 reported that about 15% of high school students reported having shoplifted.[9] Of those who reported shoplifting, they also reported other antisocial behavior such as receiving poor grades, substance abuse including smoking, hopelessness, and fighting. About 25% also reported stealing more than seven times per week, indicating problems with addictive behavior.

Programs to Combat Shoplifting

Shoplifting prevention and intervention are addressed by law enforcement at all levels of government, as well as retailers and nonprofit organizations.

Federal Efforts to Combat Shoplifting and Organized Retail Crime

• In 2007, the Federal Bureau of Investigation (FBI) partnered with retail industry groups to launch the Law Enforcement Retail Partnership Network (LERPnet) database. The retail industry managed the database whose intent was to share information in real time with the FBI and other retailers on retail theft across the country.[10] The platform was abandoned after receiving criticism from major retailers for its limited utility and after being acquired by another private company.[11]

• The Government Accountability Office (GAO) produced a report on organized retail crime in 2011 entitled, “Private Sector and Law Enforcement Collaborate to Deter and Investigate Theft.”[12] The report noted that FBI organized retail crime cases require at least $100,000 in merchandise to use as evidence and require years of work to build a case. Similarly, U.S. Immigration and Customs Enforcement under the Department of Homeland Security engages when crimes include money laundering, the export of stolen goods, or crimes committed by people living in the U.S. without proper documentation.

• Homeland Security Investigations launched Operation Boiling Point in 2022 to target organized theft groups that profit from organized retail crime, cargo theft and other theft/fraud-related activities.[13] The operation targets supply chain hubs like LA, Dallas, Chicago, and Atlanta.

• The Integrity, Notification, and Fairness in Online Retail Marketplaces for Consumers Act (INFORM Act) took effect in June 2023. This act passed by Congress requires online marketplaces to collect, verify and disclose information on high-volume third-party sellers, including bank account, tax ID, and contact information. The aim of this act and the FTC’s regulation of it is to deter the online sale of stolen, counterfeit, or unsafe merchandise.[14] 

National nonprofit organizations working on this issue include the Coalition of Law Enforcement and Retail, the National Retail Federation, organized retail crime associations (ORCAs) across the states, the Retail Industry Leaders Association, and the U.S. Chamber of Commerce, to name a few.

State and Local Programs to Combat Shoplifting and Organized Retail Crime

Across the country, states have passed legislation and formed task forces to try and deter and crack down on shoplifting:

• Several states responded to the increases in shoplifting by passing new legislation to impose stricter penalties on those caught. According to the National Conference of State Legislatures, at least eight states passed 14 bills to combat this crime, including Arizona, California, Florida, Iowa, Kansas, Louisiana, New York, and Vermont.[15] California and New York are notable, as there have been significant increases in shoplifting incidents in their major cities compared to pre-pandemic levels.[16]

• California passed Proposition 36 in November 2024 by a 37-point margin to impose stricter penalties on drug and theft crimes, including increasing sentences, aggregating similar charges across jurisdictions, and introducing new verification requirements on third-party seller websites.[17]

• The State of Washington, in collaboration with their Attorney General’s office, stood up an Organized Retail Crime Unit with ten staff in mid-2023 and has prosecuted at least three cases since then.[18]

• The New York City District Attorney’s office, the New York Police Department, and the Merchants Business Improvement Program partnered with shop owners who can contact local precincts when an individual is disrupting business; police respond with trespass notices and warnings of potential arrest for additional violations. Small businesses can enroll in the program. The program expanded borough wide following pilot program in small areas of Queens.[19]

In Colorado, state and local authorities are trying similar ways to combat retail theft:

• Colorado Springs Police Department started an Organized Retail Crime Unit that arrested twenty local repeat offenders and stopped an organized retail crime organization selling stolen goods out of Top Dollar Pawn stores.[20]

• Wheat Ridge Police Department has given radios to loss prevention staff at retailers that have been targeted so they can communicate in real time.[21]

• Colorado Attorney General Phil Weiser formed a statewide taskforce to facilitate coordination among law enforcement to identify, disrupt, and prosecute organized criminal rings that steal goods from retailers and resell them through online marketplaces. The taskforce will bring together law enforcement from around the state, create a shared set of resources for cross-jurisdictional investigations, share best practices, and provide a point of engagement for private sector and non-profit organizations looking to address this rising scourge.[22]

• Colorado House Bill 22-1099, Concerning Mandatory Disclosure of Third-Party Sellers Selling Through Online Marketplaces, passed and was signed into law to help prevent organized retail crime rings from reselling goods online. High-volume third-party sellers (over $5,000 in gross revenues) must provide bank account, contact, and tax identification information to the online marketplaces. Online sellers with over $20,000 in annual gross revenue are required to disclose their name, contact information, and any alternate sellers used to the consumer.[23]

• Senate Bill 22-001 created the Safer Streets grant program which provided grant funding opportunities to enhance crime prevention through environmental design capabilities at the local level.[24]

• Senate Bill 19-014: Organized Retail Theft Prevention: secondhand dealers or flea market or similar sellers of new goods must record the purchase of store credit, gift cards, or merchandise cards for resale; petty offense or class 3 misdemeanor if they do not; no convictions on record per the fiscal note.[25]

• Colorado Organized Retail Crime Alliance (COORCA) is Colorado’s local chapter that brings law enforcement and retailers together to discuss retail theft issues.[26]

Measures that Can be Taken to Combat Shoplifting

Combating shoplifting and organized retail crime is most effective as a joint endeavor between law enforcement and retailers with the state playing a supporting role. Each party has specific roles and responsibilities and are well-served by collaboration. As with many other types of crime, the response should be tailored to the local situation and involve implementing several different responses.

State

Since responses to shoplifting and organized retail crime typically occur at the local level unless there is evidence of larger scale organized groups stealing large amounts of high dollar goods, the state has fewer recourses to combat retail theft:

1. Provide grant funding: Grant programs in place like the Safer Streets and Multidisciplinary Crime Prevention and Crisis Intervention grant programs could be expanded to provide funding to local governments to help combat shoplifting and organized retail crime.

2. Organize task forces and facilitate cross jurisdictional interaction: the State could partner with the Colorado Attorney General’s office on the task force already in place.

3. Provide training and technical assistance to retailers and law enforcement: The Colorado Department of Public Safety’s Division of Criminal Justice maintains strong ties to local law enforcement and can assist with training and technical assistance so that local law enforcement can be better prepared, open lines of communication for larger investigations, and help to train retailers.

Retailers

Retailers carry much of the burden of shoplifting prevention. As certain retailers have been targeted more frequently with incidents that include store damage and potential threats of violence to staff, dealing with retail theft has become more complex. Roughly 50% of retail theft crimes are not reported to law enforcement, according to a survey done by the Loss Prevention Research Council.[27] Retailers often cite a slow response or lack of response by law enforcement unless there is a suspect still present at the retailer’s location as the reason to not report incidents; police often cite staffing levels that have been strained since 2020 and a lack of resources to investigate the thousands of shoplifting incidents that occur in most large cities each year. However, reporting all shoplifting incidents is important so that law enforcement and other public safety officials understand where the crimes are being committed and can plan accordingly. Keeping lines of communication open between retailers and law enforcement to share information about shoplifting incidents, potential organized retail crime, and trends regarding how and what goods are stolen allows for better prevention and intervention.

Many of the other shoplifting prevention strategies are done in store through employee engagement and store environmental design:

• Employee:

  • Acknowledge customers so potential shoplifters know you see them

  • Increase staffing levels

  • Train staff on what signs of shoplifting and organized retail crime to look for

• Store Design:

  • Keep items organized so it is clear when something is missing

  • Put desirable items behind the counter or in a locked display

  • Install cameras and carefully place mirrors to enhance visibility of high-risk shoplifting areas

  • Reduce the number of exits, blind corners, and recesses

  • Provide good, even lighting

  • Eliminate clutter and obstructions

  • Place goods away from entrances and exits

  • Create clear sight lines in aisles and reduce the height of displays

  • Reduce crowding near displays of high-risk items

  • Move hot products into higher-security zones with more staff surveillance

  • Speed up checkout to reduce congestion and waiting, which provides the opportunity for concealment[28]

• Technology:

  • Install license plate recognition cameras in parking lots or facing the street

  • Analyze departments with loss of large volumes or unexplained out of stock items through inventory systems, barcodes, and point-of-sale technology

  • Determine where and how to use closed-circuit television and use it to look for common indicators of organized retail crime through human or AI reviews

  • Use ink tags or radio-frequency identification (RFID) tags to ruin stolen items or track them

Law Enforcement

Law enforcement’s role is to partner with retailers to educate the community on risks and to be responsive to retailers and high-crime shopping areas, as well as take the time to investigate any offenses and offenders for signs of organized retail theft and larger-scale operations.

• Shorten response time when an offender is still present in store; this could mean maintaining a police presence in high-traffic shopping areas

• Review and investigate crime, including collecting closed-circuit television and forensic evidence and interviewing eyewitnesses

• Educate first-line officers and retailers on behaviors associated with retail theft

• Gather information and look for indicators of organized retail crime when responding to calls; talk to loss prevention officer or retail staff

  • Evaluate whether it is a singular incident or a larger retail theft effort

  • Interview individual suspected of retail theft, employ field tactics like stationary and mobile surveillance, document all evidence, retain intelligence and engage routinely with loss prevention or retail representatives

Punishment

Evidence suggests that the high likelihood of getting caught or punished has a higher deterrence on retail theft than the length of the punishment. People are more sensitive to immediate repercussions than future consequences (i.e. the extension of a sentence from 10 to 20 years.[29]