Rep. Ruben Gallego (D-AZ) called on Washington to take major action to help retailers nationwide survive the burgeoning organized retail theft crisis plaguing large corporations and small businesses across America.
Arizona retailers lost an estimated $1.5 billion due to retail theft in 2022, and the state has already seen a major increase this year, reason for lawmakers to get serious about the issue and enable federal law enforcement to take tougher actions, according to Gallego, who is also running for U.S. Senate.
“Retail theft is forcing stores to close, reducing choice for Arizona consumers, and making food deserts worse and contributing to retail worker shortage as people do not want to put themselves in danger,” Gallego said during a press conference in his home state Friday.
Arizona Chamber of Commerce and Industry President Danny Seiden warned that organized retail theft was rising this year at a “very fast and high rate” on a national level.
Organized retail crime reported by companies from January to August was up over the same period last year by 43%, Seiden said.
Organized crime groups are behind surging store losses in recent years. Gallego explained that the theft was not a matter of one or two teenagers stealing goods but a much broader effort to take high-ticket items in bulk to resell them on online marketplaces.
Arizona businesses were robbed of an estimated $1.5 billion in merchandise in 2022, according to the National Retail Federation. The losses meant the state lost $84 million in tax revenue that normal sales of those items would have generated, Gallego said.
The southern border has been particularly victimized because of its proximity to Mexico, Seiden said. Goods stolen in Arizona can easily be transported across the land border into Mexico and sold there.
Gallego said educating the public about the issue was important because people need to understand that it is not only an issue for businesses but for residents who shop in person for groceries, tools, home goods, clothes, and more.
“People that suffer the most are those working-class people that now have to travel further to get the basic goods that they were just getting down the street and this is why retail is a working-class issue,” Gallego said.
Michelle Ahlmer, executive director for the Arizona Retailers Association, said communities are affected when stores are forced to close.
“It does impact everyone’s pocketbook, and it impacts our communities every time a store closes,” Ahlmer said at the press conference. “It really causes a problem not just for shopping, not just for retail, but your communities are based on a network, and one of the key elements of that network is retail.”
Gallego said he supported the Combating Organized Retail Crime Act, a bill Sens. Chuck Grassley (R-IA) and Catherine Cortez Masto (D-NV) put forward this year that would boost the federal government’s ability to take on the issue.
“If some of these organizations, retail crime organizations, recognize that this is now a focus of the federal government, I think they’re less likely to engage in this, but right now, they know that if they start crossing state lines, if they steal in Arizona and sell in California or they steal in Arizona and then sell it in Mexico, that the chances of them being chased, followed, and prosecuted is very, very slim,” Gallego said. “This is why we have to move this up to a national level in order for us to really move on this.”