[Congressional Record (Bound Edition), Volume 154 (2008), Part 11]
[Extensions of Remarks]
[Page 15124]
[From the U.S. Government Publishing Office, www.gpo.gov]




           SUPPORTING THE ORGANIZED RETAIL CRIME ACT OF 2008

                                 ______
                                 

                          HON. BRAD ELLSWORTH

                               of indiana

                    in the house of representatives

                         Tuesday, July 15, 2008

  Mr. ELLSWORTH. Madam Speaker, I am proud to introduce the Organized 
Retail Crime Act of 2008 today. I would like to thank my colleague 
Congressman Jim Jordan of Ohio for joining me in this effort.
  This important legislation seeks to address a growing problem in 
America: organized retail crime--known as ORC. ORC is a criminal 
enterprise where thieves obtain retail merchandise through fraud and 
theft and then sells the goods for profit, often to fund other criminal 
activities. The Federal Bureau of Investigation estimates that 
organized retail crime currently accounts for $30 billion in retail 
losses annually. And the criminals who form and operate these organized 
crime rings are becoming more sophisticated in the ways they sell their 
stolen goods to an often unsuspecting public. ORC rings have expanded 
their base of operation from the streets, flea markets, and pawn shops 
to the online marketplace where they can break the law with anonymity.
  Before I came to Congress, I spent a career fighting crime as a 
member of the Vanderburgh County Sheriff Department. I arrested two 
thieves who were running a sophisticated criminal enterprise from the 
trunk of their car. At a hardware retailer that had several Evansville 
locations, these two thieves would pay cash for one drill, make copies 
of the receipt using a copier that they had in the trunk of their car, 
and then boost the same drills in bulk. Using the fraudulent copied 
receipts, the thieves would then return the stolen merchandise and 
receive cash back multiple times over. Today, these thieves may be 
selling the stolen merchandise online.
  This is important because not only does ORC result in substantial 
losses for retailers, it also has significant consequences for 
consumers. These criminals often boost products like baby formula, 
diabetic test strips, and over-the-counter drugs from retailers. 
Needless to say, they are not interested in the proper storage of these 
sensitive health products, and as a result, the health and safety of 
consumers, who unknowingly purchase these products, is often 
jeopardized. ORC rings also negatively impact the bottom line for 
consumers because leading American retailers are forced to spend 
millions of dollars each year conducting loss prevention efforts.
  The Organized Retail Crime Act of 2008 is a sensible bill aimed at 
making ORC a federal crime while establishing common sense disclosure 
requirements for high-volume sellers on certain online marketplace 
sites. The online marketplace is a viable place of commerce, and this 
legislation establishes necessary guidelines on how to thwart illegal 
activity and protect online consumers.
  It is important to note that this legislation contains a specific and 
narrow definition of the term ``online marketplace.'' An online 
marketplace will be subject to the bill's requirements only if the site 
has a contractual right to supervise the activities of its sellers, or 
if the online site has a financial interest in the sale of goods on its 
site.
  The Organized Retail Crime Act of 2008 requires online auction sites 
to maintain certain information--name, telephone number, email address, 
legitimate physical address, and any user identification--of high-
volume sellers for three years. The site must also keep records of all 
transactions conducted by each high-volume seller for this same three 
year period. A high-volume seller is defined as someone selling more 
than $12,000 in merchandise annually or more than $5,000 of a specific 
good. Finally, the high-volume seller is required to conspicuously post 
its name, telephone number, and legitimate address on the online 
auction site or instead, may provide this information upon the request 
of a business that has a reasonable suspicion that goods were acquired 
through organized retail crime.
  These simple and non-intrusive disclosure and recordkeeping 
requirements make sense. In fact, they are far less intrusive than the 
information required at pawn shops throughout the country. With over 
700,000 people listing online auction sales as their primary or 
secondary source of income, these basic requirements are critical to 
ensure that criminals can be brought to justice while preserving the 
online marketplace for law-abiding citizens.
  I look forward to working with Chairman Bobby Scott on this issue, 
and I commend the Chairman and his colleagues on the Judiciary 
Subcommittee on Crime, Terrorism and Homeland Security for having the 
foresight to bring this growing problem to the public's attention 
through a committee hearing last October.
  Madam Speaker, the Organized Retail Crime Act of 2008 is a non-
intrusive, common sense bill that aims to dry up avenues for organized 
retail criminals to sell their stolen merchandise at the expense of 
retailers and consumers. I urge my colleagues to join Congressman 
Jordan and me in supporting this important legislation as a first step 
toward cracking down on organized retail crime.

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