Organized retail crime is increasingly moving beyond traditional theft, with criminal networks using digital tools, stolen payment information and retail platforms to commit large-scale fraud, according to a recent CNBC investigation.
Law enforcement officials say some organized groups are using stolen credit card information and digital wallets to purchase gift cards at retailers, which can then be resold or used to purchase high-value goods for resale overseas. Investigators have linked some of these operations to Chinese organized crime networks, with officials estimating certain groups may generate significant profits through these schemes.
Unlike traditional retail theft, these crimes can occur through self-checkout kiosks, retail apps and online accounts, making them more difficult to identify. Fraudsters often obtain consumer information through phishing messages, fake payment notices and other scams designed to steal account credentials and credit card details.
Retail security experts say the growth of tap-to-pay technology and stored payment information in retail apps has created new opportunities for criminals. While convenience features improve customer experiences, they can also become targets when accounts are compromised.
Cases investigated across the country have involved a variety of retailers, including home improvement, apparel and general merchandise companies. Law enforcement agencies say these investigations can be complex because they often involve networks operating across jurisdictions.
Federal efforts, including Homeland Security Investigations’ Project Red Hook, are targeting gift card fraud and other digital retail crimes. Since 2024, the initiative has resulted in hundreds of arrests, according to officials.
Retail industry groups and law enforcement organizations continue to advocate for stronger collaboration and information sharing to address organized retail crime. A proposed federal measure, the Combating Organized Retail Crime Act, aims to improve coordination between retailers and law enforcement agencies.
