The Retail Buzz

By Scott Kreisberg

Every retailer has a unique set of security challenges and, in the retail world, your security challenges never end.

More retailers are realizing that using perimeter and anti-virus technologies alone are not enough. As someone once said, it's like locking your doors but leaving your windows open. Now retailers must take a lot more security measures.

Some vital strategies retailers need to take for preventative measures against retail loss include:

• Security for your network
• Security against theft
• Protection of data
• Prevention of administrative errors

In today's competitive environment, a retailer's shrinkage performance can mean the difference between a good year and one that fails to meet expectations.

Recording what occurs in your store is also very important, whether it be before, during or after an event. Digital video surveillance and POS monitoring can deter common forms of employee theft, register theft and fraud.

Going on for some time now is "sweet-hearting," as it's known to retailers, which is when the cashier lets friends and family walk out with more than they paid for. It is quite common in the retail sector.

To prevent this, security software is necessary which uses a motion analysis algorithm designed to spot each instance when an employee may have bypassed the checkout price scanner with a grocery item, or passed a barcode-side-up over the infrared lens. It then checks with the store's point-of-sale system and cross-references time stamps to confirm the missed scan.

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In the recent RIS News Store Systems Study 2008, the findings included the fact that Specialty Soft Goods retailers selected PCI Compliance as their number one priority in store-level IT spending (61%). (http://www.risnews.com/)

The report states further: “Last year, the top two priorities were Better Tools for Associates…and Speed Through Checkout. Last year, PCI Compliance was not a major factor.”

At the same time, Dave Hogan of the NRF (http://www.nrf.com/) said that PCI compliance was not the answer for retailers seeking a solution to stopping determined criminals. The response to Hogan’s recommendation that security standards need a fresh approach came in from many industry experts who largely agreed that retailers must look beyond PCI compliance.

And just last week, news surfaced that Advance Auto Parts, a specialty chain with 3,261 stores, had been compromised by a computer hacker who tapped into financial information at 14 Advance Auto stores in Virginia and seven other states. Like many retailers who have experienced identity file theft, Advance Auto Part’s security efforts took on a renewed sense of urgency after the breach, an action they no doubt wish had occurred sooner.

According to a recent article by Christina Zarrello writing for RIS News, Dave Hogan also told RIS that merchants should not be required to keep reams of data and that banks should provide merchants with the option of keeping nothing more than the authorization code provided at time of sale and a truncated receipt. He said, “I would like them to go on record and state that 'Retailers have the option to no longer store credit card data and they will not be penalized for not keeping credit card data.'

To address this further, over 2,900 retail loss prevention executives will be heading to Orlando this year for the National Retail Federation’s annual Loss Prevention Conference and EXPO. The event will be held June 23-25 at the Orange County Convention Center.

We will report here on news from the Conference.

Contact a sales rep at One Step Retail Solutions to help you with a POS solution that gets you PCI compliant.

Call 866-617-8181 or send email.

Written by One Step Retail Solutions

Loss Prevention Precautions for Retailers

"NSF," "Account Closed," "Counterfeit" -- each time retailers see these words on a returned check, they know they have lost money. According to the National Check Fraud Center, check fraud and counterfeiting are among the fastest growing problems affecting the U.S. financial system.

Estimated annual losses from check fraud and counterfeiting exceed $10 billion and increase every year. There were over 3 billion re-presented check entries processed through the automated check clearinghouse network in the fourth quarter of 2000, according to the National Automated Check Clearing House Association.

Checks account for approximately one-third of retail spending and they are one of the most popular form of payment, second only to cash. Because of their popularity retailers cannot afford to lose business by refusing to accept checks.

However there are some precautions retailers can take when accepting checks that will help combat check fraud.

TeleCheck, a leading provider of check services, offers these recommendations to combat check fraud:
Establish a check acceptance policy detailing acceptable forms of ID, required information and dollar limits and make no exceptions to the policy. Fraud artists are skilled at creating hassles or confusion that can leave businesses stuck with a bad check.

When accepting a check, make sure a name, address and phone number are printed on the check and the written and numeral amounts correspond.

Pay attention to the "feel" of the check; most check paper has the same weight and texture.
Watch the check-writer sign the check and have the customer print the name below, if the signature is illegible.

Compare the signatures, photo and physical description of the ID with that of the check writer.
Check the driver's license, which should be smooth all over with no ridges that indicate an alteration or modification. Verify that the ID is still valid.

Ninety percent of returned checks have low check numbers (100 to 500). While low check numbers indicate a recently opened account and a potentially more risky check, particularly for business or dba ("doing business as") checks, that is not always the case.

More useful information on the check is the account's opening date (month and year), usually indicated by four numbers to the side of the account holder's name and address.
Don't accept second-party or third-party checks.

The four-digits following the magnetic ink character recognition (MICR) number at the bottom of the check should match the four-digit number at the top right hand of the check.
All checks, except government checks, should have a perforation along one side of the check.
You can try calling the financial institution to confirm if funds are available, but there is no guarantee that the check will clear.

Use a check guarantee or verification service.

Writtten by From Melody Vargas
From About.com

Contact one of our Sales Reps on how to prevent check fraud.

Call 866-617-8181 or send email.

"NSF," "Account Closed," "Counterfeit" -- each time retailers see these words on a returned check, they know they have lost money. According to the National Check Fraud Center, check fraud and counterfeiting are among the fastest growing problems affecting the U.S. financial system.

• When accepting a check, make sure a name, address and phone number are printed on the check and the written and numeral amounts correspond.


• Pay attention to the "feel" of the check; most check paper has the same weight and texture.


• Watch the check-writer sign the check and have the customer print the name below, if the signature is illegible.


• Compare the signatures, photo and physical description of the ID with that of the check writer.


• Check the driver's license, which should be smooth all over with no ridges that indicate an alteration or modification. Verify that the ID is still valid.


• Ninety percent of returned checks have low check numbers (100 to 500). While low check numbers indicate a recently opened account and a potentially more risky check, particularly for business or dba ("doing business as") checks, that is not always the case.
  More useful information on the check is the account's opening date (month and year), usually indicated by four numbers to the side of the account holder's name and address.


• Don't accept second-party or third-party checks.


• The four-digits following the magnetic ink character recognition (MICR) number at the bottom of the check should match the four-digit number at the top right hand of the check.


• All checks, except government checks, should have a perforation along one side of the check.


• You can try calling the financial institution to confirm if funds are available, but there is no guarantee that the check will clear.


• Use a check guarantee or verification service.

Credit card receipts that include full account numbers and expiration dates are a gold mine for identity thieves. In some states, printing of the full account number is already prohibited. For the future, FACTA sets a national standard requiring truncation of credit card information.

Inventory loss...

Statistics provided by The Retailers' Association indicate an annual inventory loss of over $37 billion nationwide for theft from employees, shoplifting, vendor fraud and administrative errors.

The National Retail Security Survey discovered that nearly half of all losses can be attributed to employee theft, adding up to billions of dollars annually.

According to the Vice President of Loss Prevention for the National Retail Federation based in Washington, DC, Joseph LaRocca, it's estimated that only about one out of every eight or nine cases of scams and fraud are reported to the state's consumer protection office

Free business analysis for retailers to learn how to improve security. Call 866-617-8183 or send email.

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