LPRC - CrimeScience – The Weekly Review – Episode 39 with Dr. Read Hayes, Tony D’Onofrio, and Tom Meehan

Episode Date: January 7, 2021

Vaccination “waitlist” scams are emerging. Black Friday foot traffic down more than 52%. On this week’s episode, our co-hosts discuss these topics and much more, including COVID-19 vaccine developments, updates on the Russian state-sponsored hack, the number of security cameras deployed around the world, the increase in e-commerce sales & returns, and consumer trends of 2020. The post CrimeScience – The Weekly Review – Episode 39 with Dr. Read Hayes, Tony D’Onofrio, and Tom Meehan appeared first on Loss Prevention Research Council.

Hi everyone, welcome to Crime Science. In this podcast, we aim to explore the science of crime and the practical application of this science for loss prevention and asset protection practitioners, as well as other professionals. We would like to thank Bosch for making this episode possible. Be a leader in loss prevention by implementing integrated solutions that enhance safety, reduce shrink, and help to improve merchandising, operations, and customer service. operations, and customer service. Bosch Integrated Security and Communication Solutions spans zones one through four in the LPRC's zones of influence, while enriching the customer experience and delivering valuable data to help increase retail profitability. Learn more by visiting Bosch online at boschsecurity.com. Welcome everybody to another episode of Crime Science, the podcast. This is our latest in our weekly update series, the first of 2021. Here we are on a Tuesday morning at 8.30, and I'm joined as usual by my colleagues Tom Meehan and Tony D'Onofrio

and our producer Kevin Tran on LPRC's Crime Science. So I'll go ahead and get us rolling. Of course, always it seems for the last year now at the top of the news is the pandemic, the COVID-19 global pandemic. And we'll talk a little about, we know that reported infections are up almost everywhere in the entire world. And in most places, in this case, the United States, a lot of holiday travel and exposure. Exposure is what it's about. Each of us are potentially in the transmission chain of the virus to keep it alive and moving.

That's what it does. And it can only continue to transmit itself and to maintain its own DNA by moving from host to host, and that's each of us humans. So obviously when we're close together, that's the only way it can move from person to person. And so certainly distancing and masking are there for that reason, as well as washing our hands. So we're seeing that going up in most areas, a lot more testing going on, but as a rate is what we're looking at of a rate for a hundred or a thousand tests conducted, what percent of those register as positive. We know there are false negatives and there are false positives in the testing that we also are understanding because so much of the virus

when they're testing positive is being assayed. In other words, there's a forensic examination to understand the coding and to see how does that match up and has there been any change or mutations in what the scientists are seeing, the technicians are seeing. The UK is particularly good at this, even though we have a lot of it going on in the United States and other countries around the world. And they were the first to start to report a more systematic mutation in the SARS-CoV-2 virus that creates the COVID-19 disease. And one that looked like through their studies

was making the virus more readily transmissible, more move from human to human or host to host more rapidly and more easily. Again, another reason for us to mask and distance from each other. Doesn't mean we can't be around, but just we can't be within distance for the viral particles to transit mostly through the air to become infected,

as well as hopefully does not look like the vaccines that are continuing to come online now would not be effective in combating it. But at the same time, because there are still a lot of us that have not yet been infected with the virus and gotten COVID-19 disease, particularly at a serious level, we're seeing deaths occurring in the United States and around the world. And the fear is the more humans that get it, obviously a percent of us that get it are going to have very serious illness and even fatalities, could be fatalities. fatalities, could be fatalities. And so the idea again is if a virus mutates and becomes more deadly, if you will, that's maybe not as serious a threat as if it's more transmissible, which is the case here. And we also understand that in South Africa, they've noted several new strains. They too were conducting forensic assays of the virus, and they're reporting a new strain that seems to be particularly transmissible, may be more virulent or create more serious disease is my understanding. But the possibility that while it may not, its next variant may be resistant to the vaccine.

So my understanding is you see this with cold viruses and influenza viruses and RSV viruses all the time. And so we're seeing it here. And it's another argument, another reason for people, again, to distance and mask and to distribute and onboard the vaccine as quickly as possible around the world so that we don't see more serious mutations occurring in these virus in the virus so that's a little bit from that front what seems to be going on so we also saw that areas that had been particularly good at sheltering in place and separation now maybe have been hit because people started to come out and so on. So you're seeing that areas that maybe had lower infection rates or lower serious disease and fatality rates now maybe are being hit, particularly areas where the medical system

can be very rapidly overwhelmed and can no longer take on more patients. And so it's like on the highway, traffic stops and everybody starts backing up. So on the vaccine front, I mean, just all day, every day, we're all seeing a lot of questions, a lot of things going on. Very exciting what, obviously what Moderna and Pfizer were able to do. AstraZeneca now coming online at some point, hopefully in the first quarter of next year, J&J and several others. So I think that with the AstraZeneca, we're seeing the UK has now approved it. It's not yet approved in the United States or in the European Union. the European Union. They're going to be taking a look at it coming up here and see if that could a third, yet a third vaccine could be onboarded and start to be distributed. The United States,

it's my understanding now that the Operation Warp Speed not only got these viruses funded, or the viruses vaccine, excuse me, funded, and the manufacturing funded, and some of the liability removed, but the logistic train and the planning got out about 16 or 17 million doses, but about 5 to 6 million have now been administered in the United States. Again, the administration primarily is in hospitals or in county health departments. So you can imagine there's a lot going on there. And with the sub-zero storage requirements, that creates an incredible amount of logistical, a logistical nightmare for those handling this. And they need that zero storage because it's biomatter and it needs to remain

stable. And so they are doing testing to see how actually high of a temperature can you go. But the initial testing showed really cold, right? Minus 70, 90 degrees and things like that, in some cases for the Pfizer. So they are doing testing on that and doing testing on adding, you know, stabilizers into the vaccine that are benign to humans, but would allow of what do policymakers do as they try and race to slow down the transmission, particularly because, again, the more of us that are infected at the same time, the more likely that we're going to have more serious disease, but also not be able to take care of the patients because of overwhelming the medical system. That's the old flatten the curve that we've heard about. Two versus one dose. The testing showed with the first two vaccines out the door, the Pfizer, BioNTech, and the Moderna, that two doses were optimal to get 95, roughly 95%

efficacy. People that were in the placebo arm were 95% more likely to get the disease, not necessarily to be infected, get the disease from being infected and show symptoms than those that got the vaccine. So powerfully and very efficacious vaccines, but they were after two doses, and the doses look optimally to be 21 or 28 days apart. You get some immunity after roughly 10 to 14 days if you look at some of the data, and they show some pretty graphic illustrations showing. In the placebo arm, it was dramatic difference between those that were infected and showing symptoms in the placebo arm, whereas after 10 days, we saw a flatline infection rate from those that were vaccinated. And it was one of the most striking data analytic visualization tool I've ever seen. So moving on, that's going

to be a big debate, looking, trying to make it a science-based, do we use one dose? Because it looks like the dramatic difference in infection rate comes after one dose, and it comes after 10 to 14 days. Do we just go ahead and vaccinate more people with one dose and hope and pray we can get more vaccine? The second dose is pushed out in time or is it okay can it can instead of being given 21 to 28 days later could it be given two three

months later now we get more people protected more rapidly so right now 44 vaccines in phase one 19 and 2 20 20 vaccines in 3, large-scale trials. And now we have seven with emergency use authorization, including the two in the United States, Moderna and Pfizer-BioNTech's versions. So I think with that, we'll turn over to talk just for one minute about LPRC and some upcoming crime science episodes. We're going to start having some of our team join us and talk a little bit about LPRC Innovate, what we're up to, talk about AI Solve, the artificial intelligence R&D that we're then conducting and start ramping up

in 2021. We're going to talk about some of the anti-theft research that is underway or planned, We're going to talk about some of the anti-theft research that is underway or planned, anti-violence research, and, of course, anti-fraud. And then finally, wrapping up, Operation Next Level has been launched with Lighthouse Consultants, a five-man team that are out there getting ready to reach out to several hundred retailers around the world and talked initially starting in the United States and North America about LPRC, how we work, and our board of advisors putting out video clips and reaching out as well as part of taking LPRC to the next level, getting top-notch retailers to join the community, top-notch solution partners to become involved and join as members of this community and working together with LPRC scientists and each other.

So, without further ado, I'm going to go ahead and move over to Tom Meehan, and he's going to update us on all things fraud. Well, thank you, Reed, and happy new year, everybody. This is our first episode after the new year. And I just want to give a couple updates as we've been speaking in the last couple weeks about this massive Russian hack. And I think we were pretty early to the table when we spoke about it. I think we actually taped an episode the day

that it was publicly announced and was pretty much in every news outlet globally. So there have been some significant updates and some information that I think is pertinent to talk about. One, as we suspected and talked about earlier, this is the largest kind of state-sponsored attack that we know of on record. I think when it was first released, there was some questions of the one that happened about five or six years ago and where it came through. The first thought was that it focused primarily on the Department of Commerce and Treasury. That has expanded significantly, although the reports are still out in the open. Right now, the federal government has said it's affected roughly 250 businesses and government agencies. That's what they're really talking about. And it's a multi-part attack. And I think when we first reported, we talked about the SolarWinds piece

of it, which was a very widely used high-end malware detection and intrusion software that had a vulnerability that was taken advantage of, that was one of the pieces of it. Also, Microsoft recently reported that they had some source code that was made vulnerable because of this. And they also actually said that they were able to determine that at least one, and this information is ever-changing, at least one business's email was compromised due to it. Now, I think as the weeks go on, we'll learn more about it. And as with a lot of these hacks, what's appropriate to be given out will be given out.

I don't know that we'll ever have the full breadth of it, and I don't know that we need to. And I think when we spoke last, why does this matter? Well, it matters for a breadth of it. And I don't know that we need to. And I think when we spoke last, why does this matter? Well, it matters for a couple of reasons. One is it is a state-sponsored attack. And when you think of international and global relations, this has significant long-term implications on both how we as the United States react to Russia, but also how cybersecurity is viewed in the near and far future. And when you think of SolarWinds, it was a best-in-class software package. And one of the things we focus heavily on the LPRC is regardless of the mitigation or the kind of mousetrap, if you will, that will build, the bad guys are constantly trying to defeat it.

So as all of us are listening to this podcast, learning about what's going on, the reality is that there are some folks that have nefarious intent listening to the same podcast and trying to learn what things are out there to stop this and mitigate it. And as we perfect our skills, so do they. So the last thing I'll say about this hack, and I mentioned it before, is the U.S. government hasn't really taken a public stance on how they'll respond. It is as close to an active war as it could be, you know, in the sense that it was an attack on a government infrastructure. So I think in the upcoming weeks, we're going to really see what our response will be. And then I think the continued

information will become available. So we'll continue to report on that. Switching gears kind of to the COVID front, and I'll touch on this very quickly because we did touch on this many times even before the vaccinations were out, is the potential for scams and people unfortunately trying to take advantage of the vaccination efforts, and that is occurring. One of the most widely seen scams to date is a waitlist scam where people are presenting a waitlist and a prepay option for your vaccination. So if you're not in that category of first responder or folks that are eligible for the vaccination now, there is what looks to be a very, very realistic kind of medical provider saying, hey, we're happy to get you on first,

but in order to secure your dosage, we're going to ask for a pre-paid deposit. And it's important to note that these aren't huge dollar amounts, right? Like these companies are really, these bad guys are really portraying what a company would saying, you know, the vaccination would cost X. We're asking for all your insurance money and information in a small kind of deposit, whether it be half of the price or less. That's what we're seeing. So this isn't one of those things where someone's asking for a large percentage of money, which makes the scam more appetizing and easier for people to come on.

If I go on and I'm told I only need to give you $20 or $30, that's not as big as a challenge. But if these scammers get 1,000 people to give them $20 or $30 a day, it's a lucrative business for them. So be on the lookout for that. They are using very, very good websites and text messaging systems to work through this and make it look and feel as real as possible. They're also... One of the things I thought that was very clever is they're following news reports. So they're doing these text messages after news reports and citing the news reports or the government making a comment. So they look pretty good. I've only seen two of them so far. They look pretty good. I've only seen two of them so far.

And while it's a pretty typical kind of fishing or fishing type of attempt, the reality is they've taken a lot of time in making this look and feel authentic. So just keep your antenna up on that. And then I will wrap it out with some expected protest activity. I'm sure that we'll discuss this on the next podcast next week, but we're taping today on a Tuesday, January 5th and the 6th. There is some widespread protesting that is planned that's expected to happen in the capital area around the election. And so I think it's a little early to make any type of assessments.

The news chatter and the chatter on the intelligence side is all over the place from a standpoint of how many people will be attending, what groups will be attending. I think what we've seen throughout most of these protests recently is that you're starting to see a mixed group where you have agitators attending to just be agitators, and then you have actual folks that are there for the cause. So tomorrow, January 6th, should be in D.C. a very interesting day. I've seen reports as little as 300, as many as 300,000. So unfortunately, I don't have a real good sense based on what I'm seeing in the open source intelligence side of it. The law enforcement and federal government have taken the stance of the National Guard is in, retailers and businesses

are boarding up. So I think everybody is, because of the recent occurrences in the last six months with civil disturbance and civil disruption, I think we're planning for the worst and hoping for the best. And with that, I will turn it over to Tony. Thank you very much, Tom, and to this team and to everyone else, Happy New Year. So let me start by going around the world with an update from Visual Capitalist on video surveillance and how many cameras are deployed around the world. So the first CCTV camera, this was interesting, was installed in Germany in 1942 during the war. 79 years later, this coming year, this year, 2021, we will reach one billion cameras that will be installed around the world. China, which is not a surprise, and India, which is a surprise, lead the world with the highest density of CCTV cameras deployed. The number one city with the most cameras in the world is Chennai India which has 657 cameras per square

kilometer number two is also Hydro in India it's Hyderabad with 480 cameras per square kilometer number three is in China it's Harbin with 411 and number four was a surprise it's London with 399 cameras per square kilometer. And number five, again, in China, Xiamen with 385 cameras per square mile. And just to give you an idea, sorry, per square kilometer. And to give you an idea what a kilometer is equal to, six-tenths of a mile.

So that's a lot of cameras in six-tenths of a mile. In terms of cameras per thousand people, number one is Tian, China with 119 cameras per 1,000 people. Again, that's a lot of cameras per 1,000 people. Number two is London with 67 cameras per 1,000 people. And number three is Beijing, cameras per 1,000 people. And number three is Beijing, China, the capital with 56 cameras. In fact, Beijing has actually got one of the highest density in the world. In that city, there are 1.1 million cameras installed. So that's a little bit about the explosion of video surveillance around the world and the importance of cameras around the world in terms of across all sectors, including by governments. So let me switch now to an update in terms of what happened in the holiday season this year and what happens to overall retail. And

this is all focused on the U.S. So let me start from retail dive on the holiday season. Black Friday was unlike any other that came before it, where retailers actually trying to keep consumers out of stores this year. Shopping started much earlier in November through heavy discounting and was really kicked off in October by Prime Day by Amazon. Online shipping on Black Friday hit records. Food traffic overall in-store was down 50%. In malls, it was down 53%. In outlet centers, it was down near 48%.

E-marketers predicted a 36% increase in online sales to reach $190 billion this holiday season. E-commerce sales increased 31% in October and 32% in November. All these online sales are also going to lead to a higher number of returns. So retailers can expect anywhere from 50% to 100% returns this year. And that comes to a whopping $280 billion that are projected to be returned this year. It's the first year where Macy's limited the attendance at the parade. They actually limited to down by 75%.

Many stores discovered the beauty of virtual centers. Nordstrom, for example, made available you could have a 15-minute video call with Santa for $20. Virtual shopping became a thing for a lot of brands. And the losers included apparel, which was done dramatically, furniture and home goods, sales skyrocket, and even Wayfair, which traditionally has not made a profit during the holiday season with their furnishing model. That's a little bit on the holiday season. So what happened for the entire year in retail?

This is an analysis of 11 months from Bloomberg. And it really was talking about boom and bust in 2020 in retail across 10 charts. So I'm going to tell you a little bit about each. So number one, and I like this title, toilet paper was on a roll. And that's true, along with multiple other categories. In a single week in March, sales of liquid soap soared 320%, frozen meat 132%, and toilet paper 236%. Hand sanitizer skyrocketed more than 1,000% from early May to early July. So that's number one. Number two, online grocery carts fill up.

The pandemic has accelerated the adoption of online grocery by five years. Nearly 10 percent of overall grocery sales in 2020 were online, and they're now projected to reach 20 percent of overall grocery sales by 2025. Number three, big tickets. Shoppers went to less stores, but when they did go to stores, they bought more. And that's actually reflected in the Walmart's results, which saw declines in the number of transactions offset by a boom in sales per shopping trip. So in Q2, Walmart, per shopping trail, sales were up 20% and the same happened in Q3. Number four, which is good news for retail, even during a pandemic, stuff rules. We love to shop. Sales dipped dramatically starting in March, but actually have now fully recovered to pre-pandemic level plus some growth.

Number five, spending shifts. We shifted from dressy clothes and food we consume in ballparks to frozen foods, massage appliances, crocs, shoes, printers, mattresses, snowshoes, rice cookers, bicycles, and hair masks. Not to mention the explosion of DIY for Lowe's and Home Depot, who each pulled in more than a year's worth of growth in the third quarter after similar high growth in the previous three months. So non-store sales in those 11 months were up 23%. Building and material and garden equipment were up 13%. Food and beverage stores were up 12%. Sport and

having good stores, 4%. Clothing was down 29%. And restaurants, food services and drinking, restaurants and bars down nearly 20%. Number six, a bunch of brands got zoomed to the top. So the zoom phenomenon. So some of the breakout brands that came out of the pandemic were Peloton, whose stock boomed by more than 436%. Etsy was the best performing stock in the S&P 500 index. Yeti shares are now up more than 100%. Number seven, store shakeout. More than 11,000 stores closed in those 11 months. This followed more than 10,000 that closed in 2019. So the retail apocalypse, as it was called, continued.

So the retail apocalypse, as it was called, continued. Number eight, rough run for workers, especially for non-essentials. Retail still has not recovered the amount of volume of retail employees to pre-pandemic. It was close to 60 million pre-pandemic. It's now just above 15 million. Number nine, dining devastation. A staggering 110,000 closings in restaurants. I mean, capacity restriction and increased dining at home. Quick service has returned to pre-pandemic level.

Fast casual restaurants are almost there, but casual restaurants are still down by almost 30%. And then number 10, praying the price. So retailers have started increasing prices as a result of the pandemic. And this is a new, as Bloomberg put it, this has really been a unique year where they've been able to do it. So there's been double digit price increases in spices, dish detergents, luncheon meats, frozen meat, rice, barbecue sauce, spaghetti sauce, that's a no-no, and cups and plates. So now, and those are the top 10 trends that really covered the year. So the game is now on in this year to figure out which of these trends will stick as we go forward with consumers past the pandemic. So the good news

for all of us, it was a good retail year overall, and we can all look forward to a year with vaccines as Reid went through, and hopefully with less risk that some of the risk being less that Tom talked to. So I'm looking forward to a happy new year for both retail, for all of us and for loss prevention. And with that, I'm going to turn it over back to Reed. Good stuff, Tony. Thank you very much. Thank you, Tom. Also for all the insights and keeping us aware and alert about what's going on physically on the ground, what's going on digitally, and the threats are ever present. We see violence. We know that two Walmart AP associates were shot and wounded along with a law enforcement officer

as a result of a shoplifter, an armed shoplifter. The latest we've got is that all are recovering very well from that event. The shoplifter, not so much in this case. But we know that there's a lot of theft, of fraud, and violence happening around the United States and elsewhere. And so we've got our work cut out for us. Those of you in the LPRC community that are involved with FusionNet, we're going to be having a cluster call around that. demonstrations around the election results and any potential side effects. And it seems like retail is affected by just about anything that occurs, as well as the second one will be coming up. It'll be the second in the series, our discussion around the vaccine protection and

the logistics or supply chain, as well as in-store or off-prem. Some locations, as we know, are going to be distributing that vaccine there. And the big drug chains are already working in tandem with and for the government to distribute the vaccine in elder care centers and may be asked to speed up the process as far as mass distribution because, again, it's so difficult for very tiny

county health departments and so on. And so we all know that the drug chains, the pharmacies are very good at reminding us if we have a prescription that's due and getting things done. So look for all that, but those will be two FusionNet issues and two cluster call issues that will be coming up. So I want to again thank everybody out there listening to Crime Science, the podcast. We've got a lot of exciting episodes coming up. Kevin Tran and team are curating those and editing those that are in the bucket. And then with this team on the weekly updates, of course, I want to, of course, thank Tony D'Onofrio for bringing on so many great guests and look forward to more and more.

The same from Tom Meehan. And then also, as I mentioned, we'll be bringing our LPRC team members on one by one to talk a little bit about what they're doing in very focused research areas for you all. So stay safe. Please always go to lpresearch.org. Check us out. Let us know what you think. We're always looking for new ideas and better ways. So stay safe out there.

And for the LPRC team, for Kevin Traynor, producer, and for Tommy and Antonio D'Onofrio, I want to thank you for listening. Thanks for listening to the Crime Science Podcast presented by the Laws Prevention Research Council and sponsored by Bosch Security. If you enjoyed today's episode, you can find more Crime Science episodes and valuable information at lpresearch.org.

The content provided in the Crime Science Podcast is for informational purposes only and is not a substitute for legal, financial, or other advice. Views expressed by guests of the Crime Science Podcast is for informational purposes only and is not a substitute for legal, financial, or other advice. Views expressed by guests of the Crime Science Podcast are those of the authors and do not reflect the opinions or positions of the Office of Prevention Research Council.