The FBI announced today that it has been working with two major retail networks to launch a database that will fight retail fraud. The database is called LERPnet and will provide a centralized repository for information on retail crime, including theft, fraud, and “online auction issues”. The service is expected to launch Monday. It features free access for law enforcement personnel and is only $1,200 per year for retailers. Although it is not officially live yet, LERPnet already has over 40 retailers signed up — some of them very well-known — and over 14,000 criminal incidents entered.
Given the negligible price, it is not surprising that retailers are signing up. Organized crime has long seen retail theft as a low-risk, rewarding activity. The police do not treat these offenses as a priority. At best they are local issues, and it is therefore hard to coordinate a response to a geographically distributed attack. Making information on these incidents easily accessible is a good start. A criminal database can be a remarkably efficient way of preventing threats, for example as used in a background check.
While the retailers would prefer not to be the target of criminal activity, the increase there may actually be good news for the rest of us. Of course retail fraud pushes up prices, but still: remember when drugs were the big issue, and we feared an epidemic of crack cocaine? A lot of the folks who ran the drug business decided it wasn’t worth the risk as the violence and jail sentences increased. And why deal drugs now, when you can sell a counterfeit Gucci bag for the same price as a gram of coke? (This was pointed out in a much more detailed and elegant way in Freakonomics.) Unless society is ready to hand out 10 year sentences for retail fraud, the FBI is going to have its hands full fighting the participants. The next time you struggle to remove that unbreakable plastic bubble from your new purchause — a tool to fend off shoplifters — it may be a consolation to know that our consumer toys are luring criminals to a kinder, gentler occupation.