Tuesday, April 5, 2011

Walmart Loss Prevention Employees Engaging in Extortion?

A scruffy-looking man in his late 20's conceals a two-way radio beneath his hoodie as he follows an elderly man through Walmart. He spotted the World War II veteran placing some produce next to some prescriptions he had already paid for in the upper part of the shopping cart, where a child would normally sit. He knows there is a high probability the man will forget to place the items in this upper part of the cart onto the conveyor belt when checking out, as a high number of Walmart shoppers inevitably do. He also knows the man is not likely trying to steal the produce, but it doesn't matter to this $8/hour Walmart employee. All that matters to him is his job security, and he needs to prosecute as many people for "shoplifting" as possible in order to ensure his position and perhaps move up in the company.

He has observed several other people placing items in the upper part of their cart today, but unfortunately for him, they did not forget to unload the items for scanning during the checkout process. As he watches his "suspect" pay for his groceries (almost $200 worth) he gets an adrenaline rush as he notices the man has, as expected, forgotten to have his produce rung up.

Anxious to make his "catch", he ducks out of site and quickly makes his way to the exit towards which his subject is headed. The retired veteran makes his way to the exit, where he is stopped after walking past the receipt checker who smiles and nods him on.

"Sir, you have some items you haven't paid for in your cart." Startled, the customer at first shows him his receipt, believing the employee has made a mistake. The employee then points out the produce, and the man apologizes for his mistake and offers to pay for the items, but there will be no such courtesy extended to this man who fought for his country so long ago, and he will become one of many who has been extorted by one of the most maliciously prosecuting corporations in America.

In many states, shoplifting laws do not require that evidence of the intent to steal is present in order for someone to be prosecuted for shoplifting. Depending on the jurisdiction, anything from forgetting to place an item from the cart onto the conveyor belt at checkout to opening a box to make sure the product is inside are considered prosecutable crimes. Of course, not all retail establishments are this ruthless in how they treat their customers, but Walmart is different. Walmart has learned that exploiting their customers is VERY lucrative, and has made quite a side business of doing just that.

Walmart gets around the lack of proof in states that DO require proof of intent by claiming that anyone placing items in the upper part of their cart near personal items or bagged items already paid for are "concealing" items. There is no benefit of the doubt given to customers, even though they may have just paid for hundreds of dollars in merchandise. And, while it's true that Walmart no longer prosecutes shoplifting crimes under $5, they can and do extract a "fine" of three times the retail price of whatever someone has failed to have rung up before heading towards the exit, even though the merchandise is not damaged in any way and Walmart keeps the items. It's quite the racket. But it gets worse...

Once escorted inside the small security room, a large number of long-time, honest customers are being conned by loss prevention employees in a very unethical (and potentially illegal) way. Here's how the scam works: the suspected "shoplifter" is instructed to sit down. Once seated (and this is important) the employee hands a pen to the customer, then holds a clipboard with paperwork for the customer to sign above eye level so the customer can not see it. The employee instructs the customer that the paperwork simply allows Walmart to take and store their picture for their own database, and adds that the customer will be free to go once they sign the paperwork. A current Walmart employee who disagrees with the company's policy which trains employees to take advantage of customers in this way, speaking on condition of anonymity, explains:

"Most people are not going to question someone in authority who is promising to let them leave after they sign a document which they are told is simply a formality and as benign as permission to take their photo. Those who do ask to read the paperwork are accused of not cooperating and then threatened with arrest once police officers arrive. What they don't realize is that the police officers have already been summoned, and they will be cited for shoplifting whether they sign the paperwork or not. Getting them to sign the paperwork, however, is what makes the employee's day, since the customer is unknowingly signing paperwork that says they are admitting to the crime of shoplifting."

This is another notch in the belt of the loss prevention employee, and a guaranteed triple-profit maneuver for the Walmart corporation.

Once the paperwork is signed, the employee has the option of either issuing a triple-profit fine and keeping the incident out of the justice system, or they may have the police write a citation or even arrest the suspect. Any of the aforementioned options allows Walmart to extort triple the face value of the merchandise in question. All too often, the police are summoned and there is a citation written requiring the customer to report for booking and court on a later date.

One victim attempted to get a copy of the paperwork she had signed after discussing the matter with an attorney, and was told by Walmart employees that "the paperwork is a confidential Walmart document and we can not release it to the public". Interesting that even a party to the signed document is denied access to a copy of it or even the ability to read what they are signing after being bullied and threatened with arrest for failing to sign it on the employee's word of what it supposedly says.

Some Walmart stores are pulling two police officers off the street up to five times a day simply to write shoplifting citations. What Walmart shoppers need to consider when shopping at Walmart for their assumed "falling prices" is that they are paying several times the amount of any savings they may take advantage of inside the store in increased taxes and costs taxpayers must absorb when their law enforcement officers are not available to deal with more important matters, or when more officers must be hired to deal with the burden Walmart places on public servants in order to run this side business of triple-charging for what ultimately is the forgetfulness of busy and/or absent-minded customers.

To be fair, there are many people who intentionally "forget" to pay for items in their cart, but the majority of shoplifters are not going to have the cash to pay for the item once it is brought to their attention, nor do they make large purchases. Furthermore, Walmart appears to have an exponentially large number of women and the elderly stopped and accused of wrongdoing in their stores, which indicates that they are preying on the weak, the weak being those more likely to become distracted when checking out and/or who are more likely to struggle with memory problems.

No one is criticizing Walmart for attempting to keep prices low by reducing theft of merchandise in their stores, what they are being criticized for is for failing to extend the courtesy to their customers and provide the benefit of the doubt to those who, when stopped, are willing and able to pay for the items.

I have interviewed scores of people who have experienced very similar circumstances to this in a variety of Walmart stores across the country, and it appears that loss prevention employees are trained on how to lie to and manipulate the customers in order to extract a signed "confession". No doubt, corporate management views a high number of these signatures as evidence that their loss prevention employees are doing their jobs, but what they don't consider is the significant loss of good will and animosity that is exponentially building against the large corporation.

"I spend tens of thousands of dollars every year at Walmart," says Cynthia, another victim of the extortion practices of Walmart's 'asset protection' unit. "After having to take several days off work to go to court and losing my pay for the time off and hiring an attorney for thousands of dollars to protect my good name from Walmart's malicious prosecution, I can honestly tell you that I will never shop there again. I would have been better off buying my groceries at the most expensive mom and pop store in town."

Considering that Cynthia and her family had been going to Walmart and conducting business in the automotive repair department, the eye care department, the in-store salon, the pharmacy, and even the wireless phone department, Walmart stands to lose far more than they gain from this hostile behavior. "All of my family members, co-workers, neighbors, church members, and friends have stopped shopping at Walmart for fear that they, too, will be treated as criminals should one of their toddlers take some candy they don't know about. You don't want to do business with a store that treats people like trash, and it's worth spending a little more money to stay away from such an unpleasant place, although I've found that other stores actually have better prices now that I'm shopping elsewhere."

The fact that the loss prevention employees who walk the floor in Walmart stores tend to go out of their way to look scuzzy "in order to blend in" is very telling of what Walmart thinks of their customers. The fact that they treat their customers like scum, barely tolerated long enough to spend their money, then humiliated and traumatized over what could clearly be an innocent mistake, is also evidence that Walmart is clueless as to the most valuable assets they have: their customers.

Sunday, March 20, 2011

Authentically Fake

Perhaps you've seen the commercials: a shiny gold-colored coin slowly rotates while a voice describes it as a "$50 Gold Buffalo Tribute Coin". The narrator of the commercial goes on and on about how valuable gold is and how it is likely to rise in value, and how this "$50 coin" offered at only $9.95 is "clad" in "pure" 24 karat gold. It comes with a "certificate of authenticity" and is a "re-creation" of the "purest gold coin ever made". It goes on to say that with gold "skyrocketing past $1,300 an ounce" the $9.95 price can only be guaranteed for seven days, creating a sense of urgency.

Most anyone with common sense knows they are not getting a solid gold coin worth even $50 for $9.95, but the mention of the coin being "clad" in "pure" 24 karat gold, followed by the mention of how gold is skyrocketing in price, gives one the feeling that what they are purchasing surely must be worth more than what they are being charged, and that, even if it isn't, it surely will be once the price of gold and/or the value of this "collector's item" rises.

Even the most astute observer can be fooled if bombarded with the many misleading terms and phrases catapulted in this advertisement. When an amateur coin-collecting friend of mine asked me to look into this, even I was amazed at how carefully crafted the words they used were and, how even though the words they were using were technically accurate, the advertisement could easily leave one with the impression that they were purchasing something completely different than what was actually being sold.

For those who enjoy the study of misleading advertisements, or if you're curious as to whether or not this coin might still be worth $9.95 (it is, after all, "clad" in 24 karat gold) here is a breakdown of what the words used in this ad really mean, with each portion of the title underlined explained individually:

$50 Gold Buffalo Tribute Coin/Proof:

A "proof" coin is simply a coin that has been made with a specially polished and treated die in order to create a cameo-like effect, with the raised part of the coin standing out from a mirror-like "background" (flat surface) of the coin. Proof coins are struck twice or more, but beyond that, that's all a "proof" coin is. You could design anything, manufacture it in any kind of metal using a specially treated die, and call it a "proof".

Furthermore, any facility that manufactures coins can be called a "mint". You can create a "mint" in your own back yard if you want to manufacture metal discs with designs on them. It doesn't convey the right to create legal tender with monetary value.

$50 Gold Buffalo Tribute Coin/Proof:

Tribute simply means that this coin pays "tribute" to the original. In other words, it's a fake, a replica, a copy. In fact, U.S. federal law requires that the word "copy" appear on the coin for this very reason. If you look closely at the coin in the advertisement (also available on the web site where the coin is sold) you can see the word "copy" is engraved into the braid of the head on the coin.

In the advertisement, the term "non-monetary" is used, but when it appears in the middle of so many other misleading words, it's barely noticeable. Also, in the audio of the commercial, the term "non-monetary" is spoken so quickly it's almost impossible to discern what is being said.

What's humorous is that this is actually a "tribute to a tribute". You see, the original coin was a buffalo nickel, and then in 2006 the U.S. Mint produced a gold coin with a face value of $50 (but with an actual value much higher, since it was an actual solid gold coin) based on the original buffalo nickel produced between 1913-1938.

$50 Gold Buffalo Tribute Coin/Proof:

The word "gold" can mean many things. In this case, the description says it is "clad" in "pure 24 karat gold". What's important to remember is that "clad" simply means that it is plated in 24 karat gold.

The phrase "clad in 14 milligrams of pure gold" is designed to fool you into thinking that the coin is made of solid gold. Even if you are momentarily distracted from their misleading jargon by your knowledge of what the word "clad" means, they're counting on you to focus on "pure" and not to know just how little 14 milligrams of "pure" gold is. As it turns out, as of the date of this blog post, 14 milligrams of pure gold has a value of between $.60 and $1.21, meaning that this copy of the original, even with its "pure 24 karat gold" isn't worth much more than sixty cents.

$50 Gold Buffalo Tribute Coin/Proof:

Someone posted a question somewhere on a forum asking if the coin couldn't be used to purchase $50 worth of merchandise in a store, since it has a face value of $50 stamped onto the coin. Again, this shows how few people understand that "tribute" means fake and that this coin is NOT legal tender of any kind and has absolutely no monetary value beyond its artistic value and the sixty cents worth of gold in which it is coated.

The company selling this junk is playing on the emotions of the public, hoping their desire for financial security in a difficult economy will prevent them from thinking clearly. It's sleazy and manipulative behavior to use such an arsenal of misleading words and we can expect to see more of this.

Towards the end of the commercial, the announcer says: "avoid disappointment and future regret", imploring you to purchase the full "limit" of five of these virtually worthless coins, as if you'll spend the rest of your days lamenting the fact that you didn't buy them when you had the chance if you don't place your order immediately.

The "certificate of authenticity" only serves to further mislead any potential customers watching late-night television (which is when most of these commercials are aired). The "authenticity" refers only to the authenticity of the gold used to plate these coins, NOT the coins themselves. The coins themselves are not authentic and are copies.

Further investigation into the "National Collector's Mint" (the word "National" is clearly an attempt to appear to be an official government agency) shows that they are the same company which manufactured the "Freedom Tower Silver Coins", for which then Attorney General Elliott Spitzer issued a court order in October of 2004 for the company to halt production of the coins.

The Better Business Bureau has received many complaints about the company, which can be viewed here.

This company doesn't deserve to exist, but it does have the legal right to do so. For now. The best way to shorten the life of this company, however, is to not give them your business, and to tell everyone you know about their misleading advertising and what they are really selling.