LPRC - CrimeScience – The Weekly Review – Episode 50 with Dr. Read Hayes, Tom Meehan & Tony D’Onofrio

Episode Date: March 25, 2021

Happy 50th Episode! Thank you all for being active listeners and looking forward to many more Guest Speakers, Topics, and Events! Derek Chauvin Trial Could Bring Trouble and Ransomware is Spiking! In this week’s episode, our co-hosts discuss these topics and more, including LPRC FusionNet taking the lead in actionable intel for protests, Security Camera Company had a Breach, Eating Out is In Again, and LPRC Launched in Europe. Listen in to stay updated on hot topics in the industry and more! The post CrimeScience – The Weekly Review – Episode 50 with Dr. Read Hayes, Tom Meehan & Tony D’Onofrio 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 the science for loss prevention and asset protection practitioners, as well as other professionals. We would like to thank Bosch for making this episode possible. Take advantage of the advanced video capabilities offered by Bosch to help reduce your shrink risk. Integrate video recordings with point-of-sale data for visual verification of transactions and exception reporting. Use video analytics for immediate notification of important AP-related events and leverage analytics metadata for fast forensic searches for evidence and to improve merchandising and operations. Learn more about extending your video system beyond simple surveillance in zones one through four of LPRC's zones of influence by visiting Bosch online at boschsecurity.com. Welcome, my buddy, to another episode of Crime Science,

the podcast from LPRC. This is our latest in the weekly update series, joined by colleagues Tom Meehan and Tony D'Onofrio and our producer Diego Rodriguez. I'll start off talking a little bit about the COVID-19 situation, of course, continues to infect, and we still have, you know, widespread serious disease as well as even fatalities continue, but at a much lower rate. Transmissions seem to be all over the place. The R they use between 0.04 and 0.08, but it's below sort of two or three in most cases, my understanding, which means one person's infecting, you know, one, two, three, four other people. And again, viruses, that's what they do. They only, they only survive by not just taking over one host, but replicating and moving from host to host. So the, I think the main thing we're looking at is why did this, even this particular

virus become a global pandemic? And early on, it was projected to do so. I listened to the co-developers of the Pfizer BioNTech vaccine. They've been working and have developed and are still working and are preparing to deliver some earlier testing on, of course, the mRNA technology for cancer. That's what they do. They're cancer researchers as physicians. But they talked about when they started looking at their modeling, it was because of the significant travel to and from China, really massive amount of travel. And it took a while for that to wane. And secondly,

the asymptomatic transmission. Clearly, if somebody doesn't look or act or even feel sick, in many cases, you know, they're not staying away from people and people aren't staying away from them. And normally, you know, it's a reflex by us. If somebody looks or is acting sick, not to go over and embrace them or even get too close to them. And so that just wasn't happening. And the same thing to stay away from people if you look or feel sick. So that's a couple of reasons as you do a deep dive back in time. And then just there are two cues to look at. And again, it keeps leading to the mask idea that if you're staying away from people, which we know is natural, our minds or brains are wired to do that.

But again, trying to create obstacle courses, including better fitting masks. and are not allowing leakage to inhale or exhale the viral particles that are so transmissible with this particular virus. Looking at the vaccine front, of course, we all know that's the big story around the globe. Now over 100 million Americans have been dosed with at least one shot from the vaccines. The J&J seems to be having some hiccups, or it's not sure if it's the federal government or the manufacturer. I've read quite a bit on it, but it's been fits and starts. Evidently, the idea was that there would be up to 20 million doses put out in the month of March, an initial 4 million batch going out there. an initial 4 million batch going out there. The federal government decided to put out X amount of that and so forth. So a lot of trying to figure out how to get that out there. It's become very

popular in a lot of areas. And I've talked to several executives that are now getting, reaching the criteria for vaccine, and that's the one that they would like. But we know this, that vaccine holds so much promise because there's just one dose right now and there's no need to freeze it. It seems much more stable, the technology they use. And so it just needs refrigeration. And so that holds a lot of promise, particularly in remote areas. Of course, in a lot of countries, I heard, down in Central and South America, the current and past administrations were working to help get that down there. AstraZeneca, good news, because it looks like it also has better efficaciousness than was

reported earlier and against so much and so widespread of the more seriously transmissible and even a little more virulent strains that we've heard from Brazil, in particular the UK. To a certain extent, the South African is my understanding, but AstraZeneca seems to hold up pretty well. Evidently, from the testing in the. and even in Europe and other places where they were starting to discontinue or put it on hold or even ban it because of clotting or bleeding issues, that really evidently the data show, one, that it may And in the randomized controlled trials, I think I understand in the phase three in Europe, actually clotting and bleeding was lower in the vaccine arm of the trial than in the placebo arm. And so in regardless at the level that they were seeing the European Union's medical group that's similar to our FDA has said that the level is so low that the efficacy, the helpfulness of the vaccine is so much more valuable and that the risk is so low that the benefit outweighs it.

So that's good news. So the phase three trial in the United States looks like it may be concluded. The data are being examined or getting ready to be submitted, I understand, at some point in the next three to six weeks. So the possibility of a fourth vaccine. But additionally, again, we're hearing again, the Novavax vaccine, which is yet a different technology, also has well over 80% efficaciousness, it looks like in phase three trials. Some of those trials are getting ready to wrap up, I think, in the United States. If they haven't already,

it looks to be also safe as well as effective. So the possibility, again, of having another or a fifth vaccine available, all are good news. Merck evidently ramping up to manufacture the J&J vaccine. So that's going to provide a lot more for the United States, but in particular around the vaccine. So that's going to provide a lot more for the United

States, but in particular around the globe. So things are looking better and better on the vaccine front. Additionally, we see that Pfizer is working on a third dose to see if that's relevant or critical, but they're doing trials right now on that, human research trials. They're working on variants because again, the technology, the MRNA and some of the others that are being used allow for a much swifter adaptability and adjustment of the vaccine itself to adapt to the variants. And it's really, that's exciting synthetic biology technology and development. There are also being trials done in children. They're getting ready to commence below 16 or 18, depending on the the vaccine.

Pregnant women as well. There are trials underway for pregnant women. Some of you might have seen the news that a young woman just gave birth to a baby. She had been vaccinated and that baby was in fact born with a strong antibody load already to protect against the Corona virus. So very exciting news there. So looking at also Moderna, by the way, is working on variants and then also on children, dosing in children. J&J, their second dose trials are well underway, not quite completed. Just in case to see, does that in fact boost or provide more durable immunity for the recipients? 44 in phase one, what you'll see is some other vaccines continue to enter, move from preclinical into research. I think this is good.

Now you look at Gen 2, 3, 4 vaccines that are being developed. They're learning from the first vaccines. They're learning from the variants. They're learning, and we've talked about before, different delivery mechanisms, including misting into the nose and so forth. It might help provide some additional sterilization, local immunity, as well as systemic immunity. So phase two, 31 more vaccines, 23 more vaccines yet still in phase three. Again, six have emergency use authorization around the world and seven have full approval around the world. Again, bear in mind, Russia, India, China, and so on have one

or more vaccines as well as some other countries. I hate to leave it out. I apologize if I did. So a lot going on. Therapies continue. Still remdesivir and so forth are some of the only ones that are right now approved, but there are quite a few therapies, in fact, well over 150 therapies in different phase one, two, and three trials. Therapies are going to be important going forward, always will be. You need recovery. If somebody gets the virus, and we've seen people that have been fully dosed and it should be fully mature, still can get sick from the virus.

No virus is 100%, never will be. And again, with some of the variants, some will escape the vaccine. They will develop their own countermeasures. And so it's a pitch battle. So we need recovery therapies, particularly for the most vulnerable. So those continue at high rates. Switching over to LPRC, the Supply Chain Protection Working Group is having an upcoming call as this DOG or Data Analytics Working Group. The Innovation Working Group is coming up shortly. Product Protection Working Group. The Retail Fraud Working Group just had their latest. Organized Retail Crime Working Group just had their latest, preparing for the next, working on different research.

The Violent Crime Working Group as well. So a lot going on in the working groups. As I mentioned before, another cluster call is being planned right now based on the trials. I'm not sure, Tom, if you're going to be able to touch on that or not. Tom's our specialist at looking at what the online chatter says, what potential threats out there exist in the fraud and violence area in particular. In Canada, we're working away with some retailers up there. Kenna on our team, our research team leader, is working with one of their provinces on a major ORC and anti-theft initiative and even providing some good practices

for that. Project Onion here at LPRC, the planning's underway. That's an idea that Jeff Powers and team had to more rapidly move parking lot into an R3 status, providing more resources and securing more commitment from three to four major retailers that we've got, evidently now it looks like, as well as multiple solution partners again working in zone for the parking lot on safer use of the parking lots whether it's for routine use particularly by females violence against women is a major issue here and a thrust and a priority here for lprc and my university of florida team So stay tuned there. Operation Diamond initiative started by multiple fashion and department stores in Manhattan, looking at the particularly handbag

theft by groups that have become more and more emboldened, including producing firearms and even hitting when off to the NYPD officers are in the building or even in place. So that is underway, the planning. Operation Next Level is the global recruiting initiative. That, too, is underway. Again, well over 20 new members joining the LPRC. Very exciting. Adding so that we'll continue to build a community to surpass the 150 corporate members of LPRC working together. We'll continue to grow that. Tony D'Onofrio will touch on, again, a major, major initiative that just was launched in great part to his planning, as well as some of his team in TJX and several other large, successful retailers working on LPRC Europe. FusionNet, we're working on different ways to enhance FusionNet, make it even more user-friendly and more capable.

So with that, let me turn it over to Tom Meehan. Tom, if you will, take it away. Yeah, thanks, Reed, And a lot of great stuff. I just wanted to just touch on, I think you started to talk about it, some of the things around the Floyd trial and a lot of the chatter that we're hearing. So what I've seen on the online channels is really probably a little bit premature to really take any action on. a little bit premature to really take any action on, but the groups discussing how they would respond if in fact there was a mistrial and the jury selection after the civil award was made, this large civil award made two drawers said that they could no longer, you know, really be nonjudgmental on the jury.

So there's been a lot of chatter groups. I would say it's somewhat unorganized chatter in the sense that people on Telegram are just having an open conversation. There isn't really a plan or mindful of, it's more along the lines of if there is a mistrial, that there is going to be major disruption around it. And so I think we just need to stay tuned. We talk about the Fusion that often I know that with a fusion that is the LPR sees method of helping keep track of events, both globally and around North America, civil disturbance, weather, and other events like that. So I would

definitely stay tuned, listen to the podcast as as information becomes available. The other thing that I'm hearing pretty heavily on the chatter is related to the other officers that, you know, something has to be done. And then there's still a fair amount of chatter in those same channels around Breonna Taylor and, you know, continuing to drive that message. So I think we, you know, we need to stay vigilant and stay tuned to it. I would expect that if there was a mistrial, you know, based on the chatter and what we've seen in the past, that we would definitely see a response. I do think that based on what I'm reading and from the trials moving forward, that the jury selection is just about done and that the judge is not going to slow that process down. So I think there's a lot more to keep sight of. I would say

that the chatter that I'm hearing is, and I know I say this often, it is in the hotbed areas, the areas where we continue to see kind of civil disturbance. So the Denver market, the Northwestern market, Minneapolis for sure, Minnesota for sure. And then a little bit in New York, a little bit in Philadelphia. And that's, that's kind of the way what I'm hearing. And in Telegram, some of the channels are geographically separated. So you can actually, within reason, if you're making the assumption that the folks are in their geographical channels, you can kind of draw some conclusions to it. So definitely more to come with that. We'll talk a little bit about from the cybersecurity front. So there were two

announcements in the last couple of weeks that I thought were interesting to talk about. One is Acer, the computer manufacturer, had a ransomware attack and they're asking for $100 million to release it. So I think there's a lot more that's going to come here, but ransomware continues to be but ransomware continues to be a challenge throughout the industry. I think we think that in the industry, the ransomware is getting better. It's really not. All the studies and all of the information that runs through is that ransomware continues to be a challenge. And what it is is really malware that goes on your computer or network system and encrypts your data. And then you basically are extorted to pay a fee to unencrypt that data. And from a business standpoint, the challenge really

comes into, by not doing it, you might not get your data back. And by doing it, you might not get your data back. So the FBI recommends that you don't pay ransom, but it is very common for large institutions to pay ransom, to negotiate it. And while I don't have specifics, you hear a lot of stories where the data is opened up. It really just kind of talks to the fact that even the biggest technology companies are at risk and that those basic fundamentals of don't click on it if you don't know who it's from don't download things where that you don't know what they are and just really to stay vigilant ransomware is tricky because um it's the whole idea here is it's generally initiated by a human and then it locks the computer down so i thought that was interesting

also shell disclosed a data breach um which was fairly large, related to a vulnerability. So more information will come on that. You know, this is not a new breach, but they gave more information on that. And then I wanted to spend a little bit of time because it directly affects our listener. And it was disclosed a few weeks ago, but for DACA, which is, um, you know, a camera company that is a hybrid online camera. So, you know, when you're getting your camera, you don't have a VMS on, on, on-prem, you're not using a DVR.

It's all cloud-based, um, did have, uh, a breach. Uh, they released some information the last couple of days on it, and it's been going on for a few weeks now. About 150,000 cameras had live camera feed access. And Redaka does, you know, hospitals, schools, prisons, and retailers use this technology. It is kind of the next generation of video. And the idea here is that cloud-based.

And, you know, so you don't have infrastructure in there and through kind of the news channels, if you Bloomberg Forbes, pretty much every large news agency in, you know, in the, in outside of the tech space, none of the tech space have reported something on this. And that's mainly because Verdaka's founders founded a company called Meraki, which was arguably one of the best network security companies and sold that to Cisco. So in the IT space, these guys are very well known and they're

actually very bright and have a great, great product. This is kind of an unfortunate piece here where this breach will reach far and wide and could affect retailers. I did do some research because I found it intriguing. And there were several videos out that were from this hacking group in prisons and schools. Tesla was a big one that everybody reported on. So the Bloomberg and Forbes really jumped on kind of the big name stuff. But it was of the amount of hospital and prison video that was available screenshots from this breach. Um, and it just really talks through this as a, what I would argue some of the best technical guys in the security space had a breach. And, um, so it really runs through, there's also a ton of police video, um, from, uh, police stations that was released and put through um so it kind of really just goes to the fact that none of us are immune to it and um you know i'm sure that there are some retailers who are listening to this that do use rodaka i would tell you that it is a pretty popular new way to look at it um the what you will see if you get any research on this is you probably will see the Tesla videos

and Bloomberg actually put some screenshots of Tesla. Bloomberg put some screenshots of some other things on there, but it just really reminds us constantly to stay vigilant and that no one is immune to this. And why this is so interesting in the security space is the founders and the guys that created this arguably did create the most sophisticated security hardware in the past, which was that Meraki offering that now Cisco owns. about a few weeks ago, these are the folks that are designing the best mousetraps and the best security mitigations, and they're still susceptible. And it really leads why the LPRC is so important, that the constant education, awareness, and talking about this, because while I'm talking about cyber risk today, it's not very different than the things that we talk about, regulated risk of violence, organized crime, that we have to constantly evolve and constantly stay on top of it.

By no means would I say that the Verdaka is a bad thing to use, that because of this occurred, it just really highlighted, it really highlights because there were video released, it really highlights the concerns with cloud video and some of the concerns that retailers have had about having video off-prem versus on-prem. The news agencies that released the video obviously took some time to make sure people's faces weren't in it.

But if you do a relatively quick search in some of the underground channels, you can really get screenshots of just about everything. There was quite a few schools that I saw. There were quite a few hospital videos. So basically when this hack happened, someone was taking as much screenshots as they could and run through. The other thing that the news is really talking about, especially the Bloomberg piece of it, which I think will, could affect video surveillance in general is in Bloomberg, they taught, there's a state, an actual quoted statement of the hack exposed just how broadly we're being surveilled and the little care that's putting into the

securing these platforms. So much like I always say, sometimes the media puts a spin on it that will create challenges. I do believe that this will potentially create regulations in the future on how video is stored and what protection methodology will be there. Because there were so many prisons and because there were government accounts involved, I think that you will see some regulatory reaction later. I don't know how long that will be. You know, it's too probably early to run this out. And the hacking group that did this is really, while they're saying they're hacktivists, has links to some criminal activity as well.

activists, has links to some criminal activity as well. And additionally, back in October, Verdak also was in the news, and we didn't talk about this on, I don't want to say it because, you know, some of their employees, I think they actually fired three or four employees, were actually taking screenshots of private video. And while I would say that that has nothing to do with it, it just, you know just really shines light on where this new technology, which I think is actually a good mix of technology to have out there, does open the door for other things. When your video is stored off-prem and managed by someone else, there's obviously exposure there.

And that's all I have for today. So over to Tony. Thank you very much, Tom and Reid. Great content. So I want to take a second to actually celebrate our 50th episode. We are recording today our 50th episode since we started this weekly review. Started out as a COVID-19 series. It's turned into a weekly review on the state of retail, loss loss prevention and the cyber and all those great things that we talk about so congratulations to everyone on this team including our producers on reaching our 50th episode but let me also start with the second great thing that happened

last week which reed mentioned which is the launch of lPRC Europe. We had nearly 40 attendees. The opening comments were made by our European host, which was Nigel Kirkup from TJ Maxx Europe. And he's been working with us on this throughout last fall, leading to the launch that took place yesterday. On this journey, we've had special guests like Gary Smith from Target and Tamariji from Kroger. But in this particular call, we actually had Joe Cole from Macy's and Mike Jesse from Laxatica participating and giving a U.S. perspective. After the opening comments from Nigel, we presented a lot of the great work that's been done at LPRC, including what happened during COVID. Then Joe and Mike came on and entered some questions back

and forth in terms of how they leverage LPRC in the U.S., what they found most valuable, and particular projects that stood out for them with LPRC. We received a lot of great questions from the audience, which we will respond to this week along with following up with some notes and really moving this to the next level of actually getting LPRC Europe launched. My appreciation also to Simon and Bain from Prosegur in general for being a great partner throughout this launch process. They generated the graphics, hosted the call and really helped us along in terms of getting to the actual launch that took place last week. So overall, really a great, great start to LPRC Europe. We now have some work to do in terms of customizing some of the activity that is happening

in the U.S. and or moving to the other side of the pond, which will be another fun journey as we move forward. So congratulations to Reid and the entire LPRC team for this very, very important next step. So let me move to some data from retail from the past week, which I found valuable. Let me start with some data from CNBC. According to CoreSide Research, year-to-date major retailers have announced store openings of 3,199 stores and closing of only 2,548 stores. To give you an idea, last year for the entire year, retailers closed 8,953 stores and opened only 3,298. What that means is that we're starting 2021 on a positive note, but we're opening a lot more stores than we're closing.

And that's really good news for retail. Some of the retailers that are opening stores this year include Alta Beauty that's opening 40 direct freestanding stores, but they're also rolling out smaller stores in 100 target locations. target locations. Sephora is opening 60 freestanding stores, but actually, again, opening 850 smaller locations in Kohl's

stores. Burlington is opening 75. Amazon is quietly opening a new grocery chain. They've opened their next set of stores. The rumors on the street is that they'll open 30 of these independent new grocery store chains, a chain outside of Whole Foods, which is going to be called Amazon Fresh, and that will continue.

A company called Flabletics will open 2,000 stores and make American Eagle, Eerie, and Offline all part of the same family, about 100 stores. TJ Maxx is adding another 122 stores. Five Below is adding 170 to 180 stores. And even Gap and Old Navy and Atleta are adding 70 new stores. And the reason I gave you these names is this is the sector that was hit the hardest by COVID-19 in terms of apparel and specialty apparel brands. And they're coming back strong in 2021 and focusing on new footprint because on the other side, the pace of openings in terms of grocery continues. This year,

you'll see more Aldi, more Lidl, more Sprout Markets, more Trader Joe's, more Dollar General. In fact, Dollar General announced they're going to open 1,000 stores this year. So retail is actually having a strong start to 2021, and that's really good news. Let me move on to Bain & Company. Let me move on to Bain & Company. And they actually share some insights in terms of how Australia went through the pandemic and how retail, again, has come back strong. And they cite exactly that. Their spending is now strong.

Post-COVID retail sales are back very, very strong from the challenge, even in challenge categories such as apparel, which in January 2021, so just a couple of months ago, was up 8% over 2020. Home goods are up 20%, liquor is up 27%, grocery up 9%. The key trends they found in Australia, which again, some of these are global trends, but it's interesting to see them replicated worldwide. Working from home is here to stay. We'll mark a significant shift away from

city centers and towards suburbia, demanding a structural shift in general and investment for retailers. 43% expect to work from home versus 21% pre-COVID. And we're very happy and satisfied with working from home. In fact, all the net promoter scores are going up. The online habits that we picked up during the pandemic are sticking. And that includes in grocery. We're cooking less. So they already have started cooking less in Australia. And the idea of going out is actually going up. So what does this mean for retailers? And these are the lessons that Bain wanted us to take away from their research.

Reinvent your consumer value proposition for the new retail landscape, revisit your asset base and make online channels profitable, check complexity in everything and everything, take advantage of scale and unique assets to create a retail ecosystem, maintain the new pace of innovation and decision making. And finally, let me close with some data from Digital Commerce 360 on curbside because I do think this is a new retail trend in terms of doing commerce in the parking lots, which LPRC spends a lot of time analyzing for both the green and red shoppers.

So Digital Commerce 360 provided three secrets why curbside will not die past COVID-19. 64% of online shopping and then 64% of online shoppers intend to order more online in the next six months. Year-on-year, all metrics point to increased usage of curbside, which has seen the greatest gains. 75% of consumers completed an in-store curbside pickup in the past six months, with 22% completing 11 or more. What was interesting to me, I thought I would expect it to be grocery and Walmart and those types of chains to have the largest pickup

or curbside retail. Turns out the largest pickups are taking place in specialty store chains, such as Best Buy, the exporting goods on Depot, REI, Patco, Michaels, Office Depot. They led really all the others, followed by Walmart, which was number two, and then grocery stores as a category was number three. And again, we love curbside. stores as a category was number three. And again, we love curbside. The ratings given in this survey, 29% give it an eight out of 10, 22% give it a nine out of 10, and 26% give curbside 10 out of 10.

That's 77% that gave curbside an A-plus rating out of 10. So we love our curbside an A-plus rating out of 10. So that's a we love our curbside. And three reasons why Digital Commerce 360 again thinks this is a resonating consumers. So consumers were and always will be control freaks. They do check online to see if your items are in stock before they actually even shop in your store, which is important to, again, get that inventory under control. 58% checked online for inventory availability, just to give you an idea how important that is. Number two, there is no substitute for saving time. So we're off time start. The top three reasons shoppers pick buy online pick up in stores where it's more convenient i wanted to avoid going to the store and i can save time so

time is very very important asset for consumers and finally number three mobile is fueling a lot of this curbside efficiency and focus. Apps are getting better. 49% of online shoppers used a mobile app to buy a product. 31% used an app to locate a product. 28% used it to facilitate a pickup. So mobile is leading the way out of this crisis and will become even more important going forward. So lessons from this week. Let me start by saying what I started this with.

LPRC is vibrant. It's really an organization. All of you need to figure out how to participate and engage. LPRC Europe is just another indicator that around the world, it provides really great, valuable services that can be leveraged, especially at the pace of innovation change and the science-based research that it provides. The second lesson from today is retail is not dead.

Store openings are up, pacing, closing so far in 2021. Everywhere there are lessons to learn. Today we went to Australia, and curbside and mobile are lessons to learn. Today we went to Australia and curbside and mobile are here to stay. So I encourage all of you to follow these podcasts and LPRC to leverage the world lessons to a brighter future of retail. And with that, I'm going to turn it over to Reid. Wow. Thanks, Tony. Fantastic summary. Excellent, Tom. All your insights.

So I want to thank all of you out there. Stay safe. Stay in touch. LPResearch.org is the website, of course, and operations at LPResearch.org is the best way to contact us with your ideas, your questions, suggestions that you might have. But stay safe, stay in touch. Thank you, Diego Rodriguez, our producer, signing off from Gainesville and around the world. This is LPRC. Thanks. Thanks for listening to the Crime Science Podcast presented by the Loss 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 are those of the authors and do not reflect the opinions or positions of the Laws Prevention Research Council.