Wednesday, March 13, 2013

Organized Retail Theft: Major Middle Eastern Crime Ring Dismantled By FBI

The FBI's web site offered the below piece:

When it comes to shoplifting, this was a serious and sophisticated operation.

It involved members of a criminal group waltzing into major U.S. retail stores and pharmacies and brazenly walking out with stolen products of all kinds, from medicine and baby formula to health and beauty supplies. Those products were then repackaged and sold at rock bottom prices to various wholesalers, who in some cases sold them right back to the companies they had been stolen from.

The criminal bottom line: an estimated $10 million worth of products were swiped every year from 2008 to 2012. To make matters worse, many of the goods—some possibly compromised by being stored and shipped under improper conditions and some sold past their expiration dates—eventually ended up in the hands of an unsuspecting public.

It all came to an end thanks to a multi-agency investigation by the FBI, the Houston Police Department, and the Harris County Sheriff’s Office, with the help of victim merchants. Earlier this month, one of the highest-ranking and most prolific fences in this Middle Eastern crime ring was convicted in federal court. Charges against other group members are pending.

Sameh Khaled Danhach, a native of Lebanon and a legal permanent resident of the U.S., headed up SKD Trading, Inc. and Lifetime Wholesale, Inc., both shell companies located in Houston that allowed Danhach and his conspirators to carry out their illegal activities.

The scheme. Danhach and others recruited “boosters”—individuals who lifted the merchandise from pharmacies and retailers—from among undocumented Mexican, Central, and South American aliens in the United States. Booster crews traveled around Texas and other states and hit various businesses, often in cars rented by Danhach or his associates. For their efforts, they’d receive a small percentage of the actual value of the stolen property, always in cash so there’d be no paper trail.

The boosters then shipped the merchandise back to Danhach’s Houston warehouse using phony accounts with bogus business names, e-mail addresses, and credit cards set up by Danhach and others. These shipping companies were also victimized—they rarely, if ever, got paid.

The boosters shipped the stolen goods in case they were ever pulled over by law enforcement during routine traffic stops while they were driving back to Texas (that happened once, and Danhach wanted to make sure it never happened again).

Once the stolen merchandise was in Danhach’s possession, he would have his people remove anti-theft devices and store stickers, and then he would once again—using phony business accounts—ship the goods to various wholesalers, who would put the stolen goods back into circulation.

In March 2012, a search warrant for Danhach’s Houston warehouse turned up many interesting items: among them, more than $300,000 worth of stolen over-the-counter medications, shampoos, and baby formula, along with financial ledgers showing that from August 2011 to January 2012 alone, Danhach paid $1.8 million for stolen merchandise and sold it for $2.8 million for a net profit of $1 million.

Industry experts say organized retail crimes like this cost the U.S. about $30 billion a year. While that estimate includes other crimes like credit card fraud, gift card fraud, and price tag switching, the FBI generally focuses on the most significant retail theft cases involving the interstate transportation of stolen property.

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