The House last night approved H.R. 5932, the Organized Retail Theft Investigation and Prosecution Act of 2010, by voice vote. The National Retail Federation welcomed House passage of legislation that would establish a new unit at the Department of Justice dedicated exclusively to investigating and prosecuting organized retail crime.

“This is strong bipartisan legislation to combat the serious problem of organized retail crime,” NRF Senior Asset Protection Advisor Joseph LaRocca said. “The Organized Retail Theft Investigation and Prosecution Unit, working in close consultation with retailers, will be one of the keys to protecting both retailers and consumers against the massive economic costs and very real public health and safety risks posed by organized retail crime.”

Introduced this summer by Representative Bobby Scott, D-Va., chairman of the House Judiciary Committee's Subcommittee on Crime, Terrorism and Homeland Security, the bill is cosponsored by Judiciary Chairman John Conyers, D-Mich., Ranking Member Lamar Smith, R-Texas, and committee member Bob Goodlatte, R-Va.

The measure, which still needs Senate approval, would create an Organized Retail Theft Investigation and Prosecution Unit in the Department of Justice staffed with investigators, prosecutors and other personnel as necessary. The unit would be charged with investigating and prosecuting instances of ORC over which the Department of Justice has jurisdiction, assisting state and local law enforcement agencies on ORC and advising victims of ORC.

Under the bill, “organized retail theft” would be defined as obtaining retail merchandise by illegal means for the purpose of reselling or otherwise placing such merchandise back into the stream of commerce, aiding or abetting the commission of such acts, or conspiring to commit such acts.

In addition, the Attorney General would be required to submit a report containing recommendations on how retailers, online businesses, and law enforcement agencies can help prevent and combat organized retail crime to the Judiciary Committee. The bill would also authorize $5 million per year for fiscal years 2011 through 2015 to fund the new program.

The NRF said retailers lose between $15 billion and $30 billion to ORC each year, according to the FBI and retail loss prevention experts. In addition, 89% of retailers reported that they were victims of organized retail crime in the past year, according to an annual NRF survey released earlier this year.

ORC rings typically target everyday consumer products that are in high demand and easy to steal such as infant formula, razor blades, batteries, analgesics, cosmetics and gift cards. More expensive products such as DVDs, CDs, video games, designer clothing and electronics are also highly prized. Once stolen, the goods are resold at pawn shops, flea markets, swap meets and on the Internet. The thefts force retailers to increase prices to cover the losses, and threaten public health when crime rings tamper with items such as infant formula or medication by extending expiration dates or repackaging and relabeling the items.