Enacts the "anti-organized retail theft act"; criminalizes organized retail theft and establishes the crime of leader of an organized retail theft enterprise; relates to the authorization of jurisdiction and venue and authorized sentences for a pattern of criminal offenses; relates to the aggregated value of stolen merchandise; relates to the use of an emergency exit in the theft of property; relates to the possession of anti-security items; relates to retail sales receipt and universal product code label fraud; relates to itinerant vendors; and relates to theft with intent to resell on an online marketplace.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A8468
SPONSOR: Cusick TITLE OF BILL: An act to amend the penal law, in relation to crimi-
nalizing organized retail theft and establishing the crime of leader of
an organized retail theft enterprise (Part A); to amend the penal law,
in relation to the authorization of jurisdiction and venue and author-
ized sentences for a pattern of criminal offenses (Part B); to amend the
penal law, in relation to the aggregated value of stolen merchandise
(Part C); to amend the penal law, in relation to the use of emergency
exit in the theft of property (Part D); to amend the penal law, in
relation to the possession of anti-security items (Part E); to amend the
penal law, in relation to retail sales receipt and universal product
code label fraud (Part F); to amend the general business law, in
relation to itinerant vendors (Part G); and to amend the penal law, in
relation to theft with intent to resell on an online marketplace (Part
H)
PURPOSE OR GENERAL IDEA OF BILL:
To create within the penal law and general business law an Omnibus Anti
Organized Retail Theft Act (AORTA) Part A provides law enforcement pari-
ty with the State of New Jersey in an attempt to halt the burgeoning
criminal activity known as organized retail theft which greatly affects
the commerce of the greater New York City Metro area;
* Part B defines a pattern of crimes related to organized retail theft;
authorizes sentencing, fines and imprisonment; and allows District
Attorneys to have venue and jurisdiction over the criminal offense of
organized retail theft when at least one of the crimes constituting a
pattern occurs within their county;
* Part C would codify state court rulings which allow prosecutors to
aggregate or add together numerous petite larcenies that are part of a
connected organized crime spree thus allowing prosecutors to charge
grand larceny in the 4th Degree (a Class E Felony with up to 4 years in
prison);
* Part D would make the use of stores emergency exit as means of escape
by organized theft rings a class E felony (1 to 4 years) thereby provid-
ing store security and prosecutors another weapon in curtailing these
activities; * Part E would enhance penalties for theft of property by a
person who possesses an item designed to block or otherwise override
security markings, tags, or attachments placed on property offered for
sale in a retail mercantile establishment otherwise known as "booster
bags";
* Part F amends the penal law to make it a criminal offense to transfer,
make, alter, counterfeit or reproduce a retail sales receipt or
universal product code when the individual knows that the sales receipt
or universal product code is counterfeit. This legislation would also
make it a class E felony to possess a device for the manufacture of
fraudulent retail product receipt or universal product codes;
* Part G would establish that no itinerant vendor, except for a manufac-
turer, an authorized manufacturer's representative, or an authorized
distributor, shall offer for sale baby food, nonprescription drugs,
cosmetics, or batteries;
* Part H increases the penalties against those thieves who set up Inter-
net accounts for such a purpose.
SUMMARY OF SPECIFIC PROVISIONS:
Section 1: Title
Part A: Section 1; Adds 155.43 Retail Theft and, 155.44 Leader of an
organized retail theft enterprise to the Penal Law; provides definitions
thereof: Section 155.43, Sub 1 Definitions; Sub 2 Defines Shoplifting;
Sub 3 Defines Shoplifting as grand larceny in the 2nd Degree; Sub 4
Legal presumptions; Sub 5 Apprehension and detention.
Part A: Section 2; Effective date.
Part B: Section 1; Adds Section 70.16 Sentences of imprisonment or fines
for a pattern of criminal offenses to the penal law. Defines a pattern
of criminal offenses with relation to organized retail, theft; Author-
izes sentencing; fines and imprisonment by courts; Allows District
Attorney the to have jurisdiction over the criminal offense of organized
retail theft when at least one of the occurrences takes place in that
county.
Part B: Section 2; Effective Date.
Part C: Section 1; Aggregation. Amends paragraph 1 of section 155:30 of
the penal law by adding a new subparagraph 1(a) and 1(b). This legis-
lation would codify state court rulings which allow prosecutors to
aggregate or add together numerous petite larcenies that are part of a
connected organized crime spree thus allowing prosecutors to charge
grand larceny in the 4th Degree (a Class E Felony with up to 4 years in
prison).
Part C: Section 2; Effective Date.
Part D: Section 1; Emergency Exits, Amends section 155 30 of the penal
law by adding a new subdivision 13.
Part D: Section 2; Effective Date,
Part E: Section 1; Booster Bags Adds a new subdivision 12 to Section
155.30 of the Penal Law to define "anti-security device" and render it a
crime to use same in theft of property. Amends Section 170.47 of the
Penal Law to tender it a class A misdemeanor to possess an anti-security
device with intent to use same to steal property at a retail mercantile
establishment.
Part E: Section 2; Effective Date.
Part F: Section 1; UPC Fraud: Adds 4 new sections to the penal code as
follows: Section 165.80 contains definitions with respect to the
sections that follow. Section 165.81 creates a crime of retail sales
receipt or universal product code fraud in the second degree which
entails use, transfer, alteration, counterfeit or reproduction of a
retail sales receipt or universal product code when the defendant knows
such to be counterfeit and does so with the intent to deceive or
defraud. This crime is a class A misdemeanor. Section 155.82 creates the
crime of retail sales receipt or universal product code fraud in the
first degree which is a class E felony. A person is guilty of this
offense when with intent to deceive or defraud, he uses, transfers,
makes, alters, counterfeits or reproduces 15 or more retail sales
receipts or universal product codes, or combination thereof, knowing
such to be counterfeit. Section 165.83 creates a class E felony of
possession of a fraudulent retail sales receipt or universal product
code manufacturing device.
Part F: Section 2; Effective Date.
Part G: Section 1; Itinerant Vendor. Amends § 38 of the General Business
Law to specifically define the following items - baby food, non-pres-
cription drugs, cosmetics, and batteries - as products that may not be
sold in flea markets unless sold by a manufacturer, an authorized
manufacturer's representative, or an authorized distributor
Part G: Section 2; Effective Date.
Part H: Section 1 and 2; Efencing. Amends section 155.30 of the penal
law by adding a new subdivision 12 and 13. Sub 12: Adds to grand larceny
in the 4th degree the aggregate value of selling stolen items in the
online marketplace and defines online marketplace.
Part H: Section 3; Effective Date,
EXISTING LAW:
Currently, petite larceny (shoplifting items under $1,000) is a misde-
meanor which could result in up to one year in. jail. While the courts
have allowed aggregation of petite larcenies that are part of a
connected organized crime spree, there are no laws making this determi-
nation a permanent part of or New York's Penal Law.155.30 Grand Larceny
in the fourth degree. A person is guilty of grand larceny in the fourth
degree when he steals property and when: 1. The value of the property
exceeds one thousand dollars; or 2. The property consists of a public
record, writing or instrument kept. filed or deposited according to law
with or in the keeping of any public office or public servant; or 3. The
property consists of secret scientific material; or 4. The property
consists of a credit card or debit card; or S. The property, regardless
of its nature and value, is taken from the person of another, or 6. The
property, regardless of its nature and value, is obtained by extortion;
or 7. The property consists of one or more firearms, rifles or shot-
guns, as such terms are defined in section 265.00 of this chapter; or 8,
The value of the property exceeds one hundred dollars and the property
consists of a motor vehicle, as define d in section one hundred twenty
five of the vehicle and traffic law, other than a motorcycle, as defined
in section one hundred twenty-three of such law; or 9. The property
consists of a scroll, religious vestment, vessel or other item of prop-
erty having a value of at least one hundred dollars kept for or used in
connection with religious worship in any building or structure used as a
place of religious worship by a religious corporation, as incorporated
under the religious corporations law or the education law. 10. The prop-
erty consists of an access device which the person intends to use unlaw-
fully to obtain telephone service. 11. The property consists of anhyd-
rous ammonia or liquefied ammonia gas and the actor intends to use, or
knows another person intends to use, such anhydrous ammonia or liquefied
ammonia gas to manufacture methamphetamine. Grand larceny in the fourth
degree is a class E felony.
JUSTIFICATION:
Organized retail crime comprises a wide spectrum of high-volume and
highly organized theft rings that cost New York retailers hundreds-of
millions of dollars annually and, more importantly, compromise the
health, safety, and wallet of unsuspecting New York consumers. And for
every item stolen, New York's state and local governments lose out on
sales tax revenue again, adding up to millions annually. Organized
retail theft in the most serious security issue facing many retail
merchants, including apparel and accessory retailers, mass merchandi-
sers, do-it-yourself stores, drug stores, and supermarkets, It's a crime
that has grown substantially over the past decade, with the emergence of
organized criminal theft at an unprecedented level. Estimates from
retail and law enforcement suggest the annual loss to organized retail
theft in all retail sectors across the country combines to reach some
$31 billion. Retailers are forced to offset these significant costs
through higher prices - weaning that honest consumers are forced to
endure the impact of organized retail theft and professional shoplift-
ers. Theft rings tend to focus on over-the-counter drugs, pain reliev-
ers, health and beauty aids, and clothing of all kinds, These items have
considerable value and are easily resold to other retailers or in stores
the criminal fences operate.
DEFINITION OF ORGANIZED RETAIL THEFT AND LEADER OF AN ORGANIZED ENTER-
PRISE;
The state of New Jersey adopted Chapter 56, Laws of 2006 that defines
"organized retail theft enterprise' an "any association of two or more
persons who engage in the conduct of or are associated for the purpose
of effectuating the transfer or sale of shoplifted merchandise." This
legislation seeks parity with our neighbor state in an equally aggres-
sive and sensible attempt to curtail .a burgeoning criminal activity
that today finds almost unlimited opportunities in retail-rich New York
State.
PATTERN OF CRIMINAL OFFENSES:
Organized gangs of retail thieves know that: penalties they may face if
apprehended will he limited to their activity within a Certain jurisdic-
tion - despite the tact that their theft sprees can, will, and usually
do involve theft from stores across a number of localities and counties.
In other words, they are not deterred by a drive from one county to the
next in their effort to complete their task of stealing as much merchan-
dise as possible.
This legislation would ensure that one county could, under certain
circumstances. prosecute organized retail thieves operating across coun-
ty borders. With that authority, a county prosecutor could aggregate the
value of the thefts committees across county lines within a certain
period of time, since, again, retail thieves tend to travel from
location to location to fill their "shopping lists'. that they'll turn
over to their fences.
AGGREGATION:
These are professional thieves, not the amateur shoplifter who stay
pocket one or two items at a time. These thieves know that it's petit
larceny.- a misdemeanor - to steal items worth up to $1,000 from one
location. They'll travel from location to location and curtail their
theft just below that threshold. Court cases in 2001 and 2002 found it
sufficient to show that the aggregated value of merchandise stolen
exceeded the statutory $1,040 threshold and allowed prosecution for
grand larceny in the fourth degree (People v, Dennis (1 Dept. 2002),
appeal denied; People v. Handel, (3 Dept. 2001)). This legislation would
alter, counterfeit or reproduce a retail sales receipt or universal
product code when the individual knows that the sales receipt or
universal product code is counterfeit. The bill would also make it a
class E felony to possess a device for the manufacture of fraudulent
retail product receipt or universal product codes. Increasingly,
retailers are subject to fraud perpetrated on them by dishonest custom-
ers who transfer, alter, counterfeit or otherwise fraudulently manipu-
late uniform product code labels. Also, retailers are frequently
defrauded by customers who manufacture fraudulent, counterfeit or
altered sales receipts which are then used to return goods for amounts
in excess of actual value of the purchase. This legislation is necessary
in order to give law enforcement officials tools necessary to address
problems of UPC fraud and sales receipt fraud.
ITINERANT VENDORS:
The itinerant vendor statute, which was adopted as Chapter 282, Laws of
1995, was originally enacted to curtail the sale of certain perishable,
high-theft items through flea markets. The 1995 law focused on baby
foods and over-the-counter drugs, as these were items that professional
thieves were targeting to resell through flea markets and were products
that were compromised when exposed to sunlight and heat. The need to
tighten the definitions in General Business Law 5 38 were brought to
light when law enforcement officials in central New York encountered
difficulties in halting the sale of stolen, nonprescription drugs
because of the ambiguous definitions contained in the current law. The
proposed bill will tighten the current statute by redefining baby foods
and non-prescription drugs. It will further expand the statute to
prevent the sale of cosmetics and batteries by itinerant vendors, as
these products have become high-theft items among those engaged in
organized retail theft and because many cosmetics are similarly affected
by exposure to sunlight and heat and thereby pose a health risk. The
illegal activity this bill aims to thwart differs from shoplifting in
that shoplifters typically steal single items for their own use whereas
this bill addresses the multiple theft of products by career criminals
who steal primarily to sell the stolen goods. These crimes are often
committed to support other illegal activity involving drug use. Baby
foods, non-prescription drugs, cosmetics and batteries are attractive to
these criminals because they are small, easily cancelable, and relative-
ly expensive items. Prohibiting the sale of these products in flea
markets will close an important outlet to these criminals, thereby
making their theft less desirable. The public health concerns addressed
by this bill and the need to support law enforcement efforts warrant
passage of this measure.
EFENCING:
Internet auction sites and peer-to-peer advertising programs have become
the cyberspace flea markets where stolen goods everything from gift
cards to health and beauty aids - are sold, usually to unsuspecting
consumers who think they've stumbled on a deal that is too good to be
true. And just as when these items are sold by "itinerant vendors" on
the street, they can become compromised and indeed dangerous when they
become outdated, poorly packaged, incorrectly stored, and moved solely
for ill-gotten profit rather than with the interest of the consumer in
mind. Internet auction sites, however, are not the problem - the prob-
lem is when organized retail thieves use these sites to move their
merchandise. This legislation seeks to increase the penalties against
those thieves who set up Internet accounts for such a purpose.
PRIOR LEGISLATIVE HISTORY:
2013: A.1896 (Gibson) - Enacting clause stricken; 2011-2012: A.8591,
5.529 - Referred to Codes; 2009-2010: A.1328 - Referred to Codes;
2007-2008: A11547 Referred to Codes.
Separate legislation combined into this Omnibus Act: Itinerant Vendors:
2007; S.44/1.2 (Passed Senate; died in. Assembly Codes); 2005 - 2000:
S.3174 (Balboni)/A.5870; (Passed Senate; died in Assembly Codes); 2003-
2004: 5.7138-A Balboni)/A.10822A; (Passed Senate; died in Assembly
Codes); Booster Bags: 2007: 3.5153/A.9094 (Passed Senate; died in Assem-
bly Codes); UPC Fraud: 2003 2004: 5.2051 (Rath)/A.5144 (Codes).
FISCAL IMPLICATIONS:
Curbing organized retail theft in New York State will ensure that the
state's retailers will be able to sell the items rather than lose them
to theft, thereby collecting and remitting to state and local government
sales tax that otherwise would be lost to theft.
EFFECTIVE DATE:
Parts A, D and H will take effect 90 days after the bill shall have
become law; Part B, C and B shall take effect on the of November next
succeeding the date on which it shall have become law; Part F takes
effect on January 1 next succeeding the date on which it shall have
become law; Part G takes effect immediately upon being signed into law.
