If you're a professional in the loss prevention field and want a long career, then this guidebook is for you. For almost two decades, Herman Otis Laskey Jr. has been saving companies time and money. In this guide, Laskey offers anecdotes and methods for loss prevention, including detailed case studies about how he's uncovered internal and external thefts; issues that all retail businesses must focus on to reduce losses; ways to deter employees and customers from stealing; tips on cutting costs when investigating crimes; five secrets to a successful loss prevention career. He also shares how the STINOR Method Loss Prevention can reduce shoplifting and employee theft by up to 95 percent. This method has been used for more than fifteen years by thousands of retailers and restaurants. In addition, you'll learn how to focus on problem areas such as bathrooms and fitting rooms. By thinking like a thief and equipping yourself with the knowledge of a longtime loss prevention professional, you'll benefit from Secrets of a Successful Loss Prevention Career.
Secrets of a Successful Loss Prevention Career
By Herman O. Laskey Jr.iUniverse, Inc.
Copyright © 2011 Herman Otis Laskey Jr.
All right reserved.ISBN: 978-1-4620-3220-4Contents
Biography.....................................................................viiIntroduction..................................................................ixHow I got Into Loss Prevention................................................1Myths about Internal Theft....................................................531 Loss Prevention Topics.....................................................9Risk VS Gain Theory...........................................................45Five Important Things to Know about Your Employees............................47Using Deterrent Pages to Deter External Theft.................................51A great way to reduce your liability on external theft........................55A Pocket Guide to Conducting a Successful Phone Interview.....................59Dealing with the report aspect of phone interviewing..........................65Case Studies..................................................................67Cost associated with face to face interviewing................................69The Stinor Method.............................................................73Sources of Shrink.............................................................77My Five Secrets to Succeeding In Loss Prevention..............................79Types of Fraudulent Refunders-S. U. L. F......................................83Characteristics of a Fraudulent Return........................................87Deterring Theft in the Fitting Rooms and Bathrooms............................91My Time in Cuffs..............................................................95Thank you page................................................................99
Chapter One
How I got Into Loss Prevention
My journey into the Loss Prevention field is probably like most Loss Prevention professionals. I was going to Rose State College and needed a part-time job to help with the bills. I worked in the toy department at Target store in Midwest City, Oklahoma. I had no idea what Loss Prevention was and I had never heard of it. I began to find empty CD packages tucked away behind the merchandise on the shelves and wondered what was going on. I quickly realized that there were actually people out there that stole merchandise from Target. This blew my mind and I began to challenge myself to find empty packages every day. One day I got frustrated and asked my supervisor what they were doing about these people that steal from the store. My supervisor called for a guy named Chris and introduced him to me. Chris was the Loss Prevention manager for Target and I had no idea.
Chris told me to call him at a certain extension number if I found any empty packages or saw any suspicious activity. I took him up on the offer and called him all the time. Chris began to catch more shoplifters with my help. One day Chris told me that I would be good at Loss Prevention. I told him that I was a criminal justice major at Rose State College. He told me that I should interview for a Loss Prevention associate job opening. I told him to forward my name and information so I could interview. About one month later I interviewed and got the job. I will always remember thinking to myself, "Cool, I get paid $6.25 per hour to walk around a store and do nothing." Boy was I wrong! I soon learned that Loss Prevention was very dangerous work and that it was my responsibility to wrestle these unknown people back into the store.
My very first apprehension was a seven year old boy that stole some AA batteries. I felt so bad all week because his mom was very mad at him. I needed my first stop and nothing was going to stand in the way. My second stop happened to be my fellow Loss Prevention associates uncle. His wife worked at the service desk and like some families, she had a drug addicted uncle. He had concealed about three cordless phones inside of his jacket and waived at her on the way out. This was my first chase. Of course, I was young and cocky, so I was not going to let and old man outrun me. He ran straight into the parking lot as I asked him to stop for me. The chase was on. I grabbed his jacked and slung phones and phone accessories all over the parking lot. I scrapped my knuckles something fierce and still have the scars to prove it.
My second stop was a huge 400 pound male that had severe psychological issues. The person had concealed a tube of caulk, a bandana and some dexitrim diet pills inside of his overalls. He was amazingly calm in the office. I began to ask him why he stole and he explained to me that God told him that it was alright. He went on to explain that God talks to him all the time and he can take whatever he wants with God's permission. I did not disagree or try to argue with him since the Loss Prevention office was only about a six by six room in the back of the store. I calmly told him that I understood. He began to tell me all of the medication that he was on which was too many for me to list in this book. He stayed very peaceful and then I began to smell a horrible stench. I knew it was not me because I had showered before work that day. I talked with him and pretended to smell nothing. The police arrived and took him into custody and I was very relieved.
I will skip a few of my apprehensions and tell you all about the good ones. One Christmas Eve I was working and noticed a clean cut attractive female selecting numerous CDs and placing them in her cart. I followed her around until she concealed all of the CDs. The female came back to the office and offered to pay for the merchandise but that was not in our policy so I called 911. While we were waiting for the police to arrive, she entertained me with a series of attempted bribes. None of them came close to my paycheck amount so I refused them all. She was the owner of a local insurance agency and felt very confident she could convince me to let her go. She tried everything from offering me a job to writing me a $1500 check. The officer arrived and was in a very bad mood. Probably because he had to work Christmas Eve. He immediately told her to stand up and placed hand cuffs on her. She was arrested for theft and taken to jail. We ran the cameras back to see what car she was driving. At closing, her car was still in the parking lot so I decided to go and take a look. Her car was filled with Christmas gifts for her kids. They would have to wait until mom got out of jail to get their gifts. I later found out that she spent all of the holidays in jail because the judges were out of town and no court was held.
Myths about Internal Theft
Internal Theft 70%?
For years Loss Prevention professionals have said that the majority of theft is internal. Is it really so? Let's think for a minute. One of your colleges is known for catching many shoplifters. Don't they always have their fare share of internals? Also, don't your colleges that have a significant amount of internals have their fare share of externals? What is this deal about 70% of theft being internal?
Some have said that one internal equals five externals. Can't the same be said for external theft? Cashiers and other employees can easily steal more than shoplifters because they are in the store on a regular basis. I have also known some shoplifters to be in the stores on a regular basis. Just because we do not see them every time does not mean they are not in the store. We simply get lucky and one day our schedules collide with the shoplifters. I personally had one shoplifter that was apprehended for $2,005. Later employees told me that he was a regular customer for years. I can tell you that his activities incurred a higher dollar amount from that particular store than any cashier in my district.
All of the culprits that print up false receipts, fraudulent checks and false upc (universal product code) codes all depend on shoplifters and are classified as external theft. These guys make six figures a years and it is all due to the shoplifters coming into the stores, not cashiers or employees. The organized theft rings depend on shoplifters to supply their inventory. These guys also make six figures a year. How many internal cases have you encountered where the terminated employee was making $100,000 doing fraudulent refunds or passing merchandise?
Yes, there are stores that have a large dollar amount of internal theft. Cashiers can pass merchandise all days long and eventually someone will notice. It may be Loss prevention, managers or a fellow employee. Shoplifters can go to any store on any given day. Let's keep in mind that some of the same shoplifters you chased out of your store were apprehended at the store across town. Shoplifters have many targets. When one store has been depleted of the product of there choice, they simply go to another store. Cashiers are fired and terminated, never to cause a loss at any store in that chain again. They may apply at another retailer but sooner or later a background check will catch up with them. We do not have the choice to refuse shoplifters entry to our stores, unless we know they are shoplifters. How often do we know this?
Some stores do have more internal theft but as a chain, this 70% theory does not hold true. Remember this when you see the figures for 2004 on internal and external theft. Believing that your chain has a 70% internal theft rate can be misleading for you, your staff and the future success of your company. One last thought to ponder is that in 2003, over 35,500 employees were apprehended which was a 7.74% decrease from 2002. The total value of the recoveries also dropped by 3.84%. The number of shoplifters in 2003 rose by 3.01% to almost 337,000. The total value of recoveries rose by 4.68%. If this trend continues it will definitely be 70% but this time the 70% will represent external theft.
31 Loss Prevention Topics
Here is a list of Loss Prevention topics for you to use at your convenience. These are factors that the everyday retail professionals do not know. These topics can be discussed at any meeting to help raise awareness. They are sure to spark conversations in every retail environment. I have chosen 31 so you will have one to discuss each day.
This list encompasses all Loss Prevention topics listed below:
1. Internal Theft.
2. External Theft.
3. Retail Statistics.
4. Discount Abuse.
5. Risk Factors of Internal Theft.
6. Risk Factor of External Theft.
7. Penalties of External Theft.
8. Penalties of Internal Theft.
9. Safety Factors of Apprehending Shoplifters.
10. Psychology of Shoplifting.
31 Loss Prevention Topics By Laskco Inc.
1. Customer service is always the best form of deterring shoplifters.
2. For every $100 stolen, it takes $2,500 worth of sales to make up for the loss.
$5,000 loss=$125,000 in sales.
30,000 loss=$750,000 in sales.
3. Theft affects every employee in the end. (Raises, bonuses, etc...)
4. Knowing about theft and not reporting it makes you just as guilty.
5. There is no profile or description for shoplifters. All races, creeds and colors commit acts of shoplifting.
6. Employee theft can be anonymously reported by using a LP hotline.
7. Loss Prevention is every employee's job.
8. Shoplifters get caught once every forty-nine times.
9. Most shoplifters get the same high as drug users when shoplifting.
10. Shoplifters and employees that steal have the money to pay for the items 90% of the time.
11. Shoplifting has doubled since 1996.
12. Shoplifting is a 35 billion dollar a year industry. That is 35 million dollars per day.
13. Approximately 27 million people shoplift per year. That is 1 in 11 people in the United States.
14. Only about 3% of all shoplifters are true professionals that steal for a living.
15. 89% of kids say they know other kids who shoplift.
16. Shoplifting incidents increase about 11% per year.
17. Losses due to theft are passed on to you the consumer.
18. Most employees feel they cannot do anything about shoplifters in their store. Not true. Customer service is the best method.
19. Most shoplifters are not violent; they just want to get away from the scene as soon as possible.
20. Abusing your employee discount can cause the company losses in profit.
21. About 9% of all returns are fraudulent.
22. Chasing shoplifters through the parking lot is dangerous and should be against company policy.
23. There is nothing that your employer sells that is worth risking your career or life over.
24. Shoplifting occurs more often but employee theft results in more dollars lost.
25. Some employees risk their yearly salaries by stealing small amounts. ($49.99 Nike shoes vs. $30,000 salary) It is not worth the risk.
26. Some employees are not aware that most companies have sophisticated computer auditing systems that routinely look for signs of employee theft. (Cash refunds, passing merchandise, excessive discounts, etc....)
27. There is no good time for shoplifting. It can occur early in the morning or late at night. It can occur when the store is crowded or when there are only two customers in the store.
28. Most customers that are banned from the store just go to the nearest location and steal.
29. Many retailers have prosecuted the same shoplifters numerous times at different store locations.
30. Helping friends steal merchandise can also land you in jail for being an accomplice.
31. Most people who commit acts of theft do not truly realize the penalties for doing so.
Risk VS Gain Theory
This risk versus gain theory is used to help combat internal theft. I have found that discussing this with employees greatly reduces their potential to steal from employers. It is a fact that most employees do not consider the punishments and risks when they think about stealing from their employer. They risk stealing a $100 pair of shoes and loose their $20,000 to $30,000 salary. Most retail managers make around $40,000 to $60,000 per year. They would have to steal double that amount to make it worth the risk.
For instance, I interviewed a part time employee who stole a $179 fishing reel. He told me that he made around $20,000 per year plus medical benefits. We discussed whether or not he thought about getting caught. The thought never crossed his mind even though he admitted he knew he was doing wrong. We continued to discuss the numbers and I took a sheet of paper and wrote down $179. I also took a sheet of paper and wrote down $20,000. The employee was asked which amount he would prefer to have. He overwhelming chose the $20,000 sheet of paper. I asked him, "If we would have had this talk at the beginning of his employment, do you think you would have stolen that reel?" He told me, "I would have left that reel in the store."
We also discussed the fact that the $179 reel could have come from his $20,000 salary and he would still have $15,900 to pay his bills. He seemed very disappointed when he heard this. It is all common sense but the wrong messages are sent out to employees regarding employee theft. It seems to me that the message is "Don't steal or you will get caught" when it should be "Don't steal because it is not worth the risk." Employees risk so much when they become dishonest. Here is a list of risk factors that can be discussed with employees:
1. Your employment.
2. Your reputation.
3. Your salary.
4. Your Future.
Five Important Things to Know about Your Employees
We all think that we really know a person after working with them for a number of years. The fact is that we never really know a person deep down inside. As an employer it is very important that we dig down deep and really get to know our employees. Knowing your employees can help give you clues about their real personality. I once had a case where a 14 year employee was stealing gas from his employer. This happened during a huge increase in oil prices so you can imagine what the employee's motive was. (To save money of gasoline) Once I revealed that the employee was stealing gas, I was sure that he would be terminated for theft if not prosecuted for embezzlement. This employee was given a two week suspension and I was asked not to report my findings to local law enforcement. The company also failed to have me check further into prior thefts of gasoline. It all seemed to me that they did not want to know. My question was "Who was going to pay for all of the stolen gasoline?"
1. Are my employees married or single?
2. Do my employees have kids?
3. What are my employee's hobbies?
4. Do my employees feel comfortable bringing issues to me?
5. Do my employees think I care about them?
(Continues...)
Excerpted from Secrets of a Successful Loss Prevention Careerby Herman O. Laskey Jr. Copyright © 2011 by Herman Otis Laskey Jr.. Excerpted by permission of iUniverse, Inc.. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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