Amy Klobuchar Asks American Eagle Exec. About 'Threats Of Violence' From Organized Retail Cartels

Forbes Breaking News

During a Senate Judiciary Committee hearing prior to the congressional recess, Sen. Amy Klobuchar (D-MN) questioned American Eagle Outfitters' Chief Global Asset Protection Officer, Scott McBridge, about the threat of violence from organized retail crime syndicates.

Transcript

00:00for being here. I have some more questions, but I will submit those for the record.

00:03Senator Klobuchar. Hello. Thank you so much for being here. I was talking to Senator Whitehouse

00:10there about my previous job when I was a prosecutor, and we actually set up a whole

00:16group of prosecutors to work on this retail theft. It seems like our problems were simple back then

00:21compared to now. But I guess I'll start with you, Ms. Steffen. Could you tell me how this federal

00:30legislation would ensure that criminals who engage in what is actually different than it

00:35was back then, I'll say, that's now organized retail theft, face accountability? Thank you,

00:43Senator Klobuchar. The cases that we've done, which have been 218 cases in over two years with

00:51a $2.6 million loss, show us that there is a footprint and it's outside our state. It's

00:58across the nation and an international footprint. A recent $8 million jewelry heist, the Rolexes were

01:07gone overseas with the fence being in Chile. So it will enhance our ability to be ahead of it,

01:17to prevent the same type of jewelry heist had happened in the state of Washington. But we received

01:23no information, our local task force to tell us there's this trend, be on alert to it, because it's

01:31extremely sophisticated. That's why that retail crime coordination center would be so important.

01:36Exactly. If you get that information. Mr. Glock, could you tell me how transnational

01:41criminal organizations use cargo theft to actually fund other illicit operations?

01:50We have seen an exponential increase in cargo thrust over the last three years. In 2023,

01:58we saw almost a 27% increase. We're seeing another 22% increase. That's a 50, well,

02:02we estimate in the end of 2025, we'll be 50%. We know this supply chain is going overseas. We know it's going

02:11over our border. These stolen goods essentially have 100% markup, you steal it and your profits are 100%.

02:16So the question is, how do we identify those nefarious actors, those networks that are the

02:21biggest threat to the homeland, as Senator Britt just talked about, is that's the need for those

02:25classified databases to be run against these criminal networks. And you know well, Senator,

02:29and this bill would provide us the strategic and tactical intelligence to address these biggest

02:36threats to the homeland, which we have no doubt that these supply chains are being used to facilitate.

02:41Thank you. And Mr. McBride, I think this is an important point. How do the threats of violence

02:47by these organized retail crime cartels not only threaten the safety of store employees, but also

02:55make it hard to keep the stores open? Thank you for the question, Senator. Yes, it's the threat of

03:02violence and the actual violence that some of my peers have experienced has grown exponentially over the

03:08last decade. My fellow witness here testified to the attitudes of some of the store and shop owners

03:16that are concerned for their safety when they're operating their shops. The intimidation tactics to

03:25come back and to be able to re-victimize the retail locations over and over again has grown so much that

03:32we have had to implement additional countermeasures. We've had to implement training to keep our employees

03:37safe. We've had to lock up and hide. All of that leads to a re-evaluation of the investment that's

03:43being made in new stores, different locations and those types of things and has in some cases with

03:50the entire retail sector led to product deserts in some parts of this country because stores have had to

03:56close up and leave because they could no longer sustain a viable operation because of the violence,

04:02the crime, the theft and the losses that they are incurring. Okay, very good. Ms. Lam, last but not

04:09least, so first of all thank you for the support for the Ocean Shipping Reform Act, the bill that Senator

04:16Thune and I did. Yes, and as many of you know that was about the pricing during the pandemic that was hurting our

04:25farmers and our retail making it really difficult and after we passed that bill on a bipartisan basis

04:31then President Biden signed it into law. It actually, the rates went down for a number of reasons but I

04:36think the threat of that and the Maritime Commission eventually doing rules made a difference and it

04:41wouldn't have happened without companies like yours so. Just one question on this topic. Do you agree

04:50that cargo theft poses a risk to the security of our food supply chain? I absolutely do. Explain that

04:57quickly. Why? Yes, Senator, and thank you for the question. First of all, food and beverage is the

05:03number one targeted commodity in cargo theft. Number one. And why? Demand, of course. It's so difficult to

05:14track. It's so easy to distribute and what is so devastating about that is, you know, the price of

05:22food we know already is so high. The average American cringes every time they go to the grocery store

05:28and what happens with these targeted thefts on food is once you have something that's precious,

05:37any kind of food. You pick it. We see two, three, three, four percent stolen. Those costs are

05:45immediately passed on to the consumer. We also, and you've been very helpful with us as we discuss

05:51ag exports. And what's happened is actually targeting agricultural exports, beef, poultry, perishables.

06:01And what we also see that's happening because of so much of this transnational cargo organization

06:08crime that's happening on our railroads, pilferage. Yes, it may be secondary. We believe these thieves

06:14are after high value cargo. But in the meantime, destruction to our ag exports as they cut the seals

06:22and the integrity of load is lost. Thank you. Appreciate it. Thanks. Thank you, Mr. Chairman. Thank you for

06:29introducing the federal legislation, Combating Organized Retail.

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