星空传媒

The scale of card fraud is truly staggering, with one in three people in the UK affected and 拢402.4 million lost through plastic card fraud last year. More than 拢1.1 million worth of card fraud occurs on UK cards every day.

But with 60 per cent of total card fraud relating to skimmed or stolen cards, the programme to replace a signature with a PIN number is expected to reduce this type of fraud very significantly. In France, card fraud was reduced by 80 per cent in the ten years following a similar initiative.

But even these very significant figures need to be seen in the context of retail fraud as a whole 鈥� and it is this wider picture that continues to concern retail security managers and helps to explain the continuing spend on retail CCTV.

According to the most recent annual Retail Crime Survey undertaken by the British Retail Consortium, during 2002 customers committed more than eight million thefts and employees more than one million.

The value of these explained losses is estimated at 拢1.7 billion. Unexplained losses 鈥� specifically undetected customer, supplier and employee theft 鈥� are estimated at an additional 拢1.4 billion.

Of the total unexplained losses, 44 per cent 鈥� over 拢600 million annually 鈥� is believed to be unidentified staff theft. So however good chip and pin might be, retailers clearly cannot afford to see that programme as a panacea for the eradication of crime in their stores.

Although some in-store theft does take place away from the tills (everything from customers confidently wheeling trolleys full of goods out of the store, to shelf fillers hiding goods outside the rear of stores for later collection), it is the till that is often most vulnerable. And it is on the tills that the inventiveness of staff and customers (sometimes in collusion) presents the retailer with their greatest challenge.

Till related crimes

The most common type of till related crimes include 鈥榮weet hearting鈥�, substitute scanning, shortchanging and no sales.

Sweet hearting requires an accomplice or 鈥渟weet heart鈥� that loads up expensive items into their trolley. At the checkout the clerk rings up the items but charges a lower price than marked, omits some of the dearer items or 鈥榮cans鈥� expensive items with inexpensive barcodes taken from other products.

Another method is for the clerk, once the legitimate customer has left the store, to render their transaction void. As the money is still in the register it will have to be removed either then or towards the end of the shift.

The most common suspect sale is the 鈥榥o sale鈥� that enables the clerk to open the till. There are legitimate reasons for this like correcting change mistakes, but if the clerk is performing sweet hearting, pilfering, void transactions or substitute scanning, towards the end of a shift the clerk will have to remove the accumulated money before their shift ends. Therefore it is especially important to check for all no sale transactions within the last hour of a shift.

Finally, the clerk can imitate a product return and cash refund using items pulled from stock for the purpose with the fictitious refund given to friends, relatives or the clerk themselves.

Knowing that a crime involving staff has been committed at the till does not necessarily provide the evidence required for dismissal or even successful prosecution. This is because the data streams from the till and electronic point of sale (EpoS) systems are independent of one another, leaving the way clear for lawyers to dispute the level of synchronisation between the clocks on the different systems.

However, a number of systems are available on the market that integrate the CCTV and till data streams. By overlaying CCTV images of the transaction with till transaction data, investigators can monitor precise and detailed EPoS transactions and identify the offenders. Example systems include Vista TEAM from Vista and Retail Solutions from Dedicated Micros.

The potential business for installers and manufacturers in this sector of retail appears very substantial. Is the industry ready to respond to this opportunity?

Four elements

Vista TEAM (Transaction EPoS and ATM Monitoring) comprises four elements:

• 1. Multiple high resolution CCTV cameras installed at EPoS sites and positioned to capture the best view of customer and cashier
• 2. Till/TEAM interface
• 3. Data monitoring device
• 4. Triplex Columbus Digital Video Recorder (DVR)

The TEAM monitoring device passes sales transaction data from the EPoS system (via an interface) to the Triplex Columbus DVR. The DVR then combines and records the transaction data with captured CCTV images. Video and transaction information is stored on the Triplex Columbus hard disk unit that provides from 40GB to 1TB of storage. Dedicated Micro鈥檚 Retail Solutions offering is similar using DM鈥檚 own DVRs.

Seeing is Believing

Paul Fordham, Business Development Executive in Norbain鈥檚 Retail Strategic Accounts Department, believes that integrated till and CCTV solutions represent a major step forward in the intelligent convergence of retail-based technologies:

鈥淰ista TEAM has two major attractions. The first is the real-time video display of transaction data. As items are swiped through the EPoS reader or cards swiped through the EFTPoS reader, the transaction data is relayed in real-time over the live video images. This provides a level of detailed evidence currently absent from separate CCTV and till systems. Proving that a specific image corresponds to a specific transaction is almost impossible without the level of integration that Vista TEAM provides.

鈥淭he second major attraction is the text search facility that is available with the Triplex Columbus DVR. Any transaction can be interrogated by transaction ID, goods purchased, sku (stock control unit) code, payment type, price, cashier ID, date, time and void transaction. Searches can also be undertaken on part or whole Credit Card and Direct Debit numbers and Staff Discount Card numbers.鈥�

Sports store鈥檚 top TEAM

JD Sports is one company that has decided to address the issue head on. JD Sports has adopted Vista TEAM as a key component of its in-store security strategy. Tim Edwards, JD Sports鈥� loss control director, believes that Vista TEAM offers the retailer multiple benefits:

鈥淲e elected to use the Columbus hard disk recorder and TEAM combination because the solution was price competitive and offered numerous additional facilities including the till data function. The major benefit arises from the level of sophisticated monitoring we achieve through its digital and integrated design.

The system sits on our internal intranet so is compatible with our centralised monitoring strategy but 鈥� due to the compression technology involved 鈥� has no negative impact on other network traffic.鈥�

Once every two hours suspicious transactions, perhaps every void, refund or no sale transaction, are downloaded and viewed centrally at JD Sports鈥� monitoring station at Heywood in Lancashire. The search capability of the Columbus enables the operator to access the required transactions in seconds and then quickly decide whether the suspicious transaction is genuine or not. This avoids unnecessary action in the store itself.

Tim Edwards is totally sold on digital CCTV recording and searching technology: 鈥淲e appreciate the search function, the alarm inputs and the ability to set different record frame rates for different cameras depending on the quality of image we need. The benefit of integration comes with the synchronization of till and recorder times through our computer network. This cuts down dramatically on the painstaking task of identifying the suspicious transaction in question.

Much of the slow uptake for integrated till monitoring solutions can be put down to limited installer knowledge and confidence.

鈥淰ista TEAM enables us to identify suspicious transactions quickly as well as accurately. We hope to eliminate very many suspicious transactions as a result and become recognised as a retailer with a highly effective counter fraud strategy. However, Vista TEAM has other applications too and we also hope to improve our product margins through, for example, a closer and more accurate analysis of discount sales made at the till.鈥�

Retail Solutions

Dedicated Micros launched its till monitoring application suite, Retail Solutions, at this year鈥檚 IFSEC show. UK sales manager Nick Platt-Higgins believes that it is the digital nature of such till solutions that lies behind the positive reception their offering received at launch:

鈥淣ow in a couple of keystrokes you can discover all your voids, no sales and so on. The return on investment is truly massive with one of our end users saving the equivalent of their weekly rent, week after week after week.鈥�

Why has it taken until now to start any real momentum towards dealing with staff fraud at the till? Part of the reason undoubtedly lies in the ready access of affordable digital solutions. But that鈥檚 not the complete story.

鈥淐onfronting staff over issues of staff theft is difficult鈥�, says Nick Platt-Higgins. 鈥淩etailers need technology to give them the absolute confidence to address the issue. In the absence of independent evidence it is difficult to raise the issue with staff.

Addressing external theft is simply easier to address. We find that retailers can be embarrassed to discover just how much till theft they are suffering from.鈥�

But there鈥檚 another issue too which the CCTV industry has faced before. Innovation in the security industry is often accompanied by a desperate need for installer education and training.

Nick Platt-Higgins, whose own company has undertaken extensive promotions of its Retail Solutions offering, believes much of the slow uptake for integrated till monitoring solutions can be put down to limited installer knowledge and confidence:

鈥淚nstallers used to self-contained CCTV systems now have to understand tills and till interfaces. We need to train the installers in the opportunity that exists here. That鈥檚 why we鈥檙e producing a Retail Solutions Toolkit that will give the installer, and the end user, the necessary knowledge to install their solutions.鈥�

Estimates of the penetration of integrated till and CCTV solutions do not exist but even a cursory glance at the industry means that it must represent less than one per cent of retailers. Given that, the potential business for installers and manufacturers in this sector of retail appears very substantial. Is the industry ready to respond to this opportunity?

Norbain LIVE04, an event held at venues across the UK in September, will feature the latest retail solutions from leading manufacturers. For more information on Norbain LIVE04 go to www.norbain.co.uk/live/.

Multiple uses of CCTV in retail

Deterring theft need not always be the only objective behind the very substantial investments that retailers make in CCTV (拢39million in 2002). Other applications of the technology include:

• Market research: the ability to view shoppers and staff remotely via networked CCT systems is more cost effective than sending teams of researchers into individual stores.
• Fraudulent claims: CCTV is increasingly used to investigate claims made against the company by either staff or customers; these might relate to staff behaviour or to claims of negligence gainst the retailer (for instance, over a slippery floor).
• Measuring footflow: the routes taken by customers around a store reveal vital intelligence about shopping habits and ideal tore layouts.
• Staff safety: employers have a duty to take 鈥榬easonable steps鈥� to protect their staff from abuse and attack whilst at work. The number of verbal and physical attacks against staff continues to increase and not only does CCTV footage provide invaluable evidence in such cases, it also acts as a deterrent in the first place.
• Theft of time: a number of staff will take advantage of their employer by taking time off from their duties, especially in hidden areas of a store such as a warehouse.
• Contamination threats: thankfully this type of crime is rare but CCTV can be used to track suspicious behaviour of staff or customers.