Combating C-Store Theft

Typically, convenience stores can experience a few gasoline thefts a week. But when prices increase, some stores see several gas thefts a day.

By Howard Riell, Associate Editor
When times get hard, thieves get industrious and innovative. The response by convenience store operators must be twofold: extensive background checks on potential employees to weed out the shady characters, and solid policies and procedures—including closed-circuit cameras and prepaying for fuel at night—to secure the premises.

Companies conduct criminal background checks on job candidates primarily to ensure a safe work environment for employees, to reduce legal liability for negligent hiring and to reduce or prevent theft or other criminal activity.

“Background checks are just one tool to help employers make informed hiring decisions,” said Kate Kennedy, manager of media relations for the Society for Human Resource Management in Alexandria, Va., which has more than 260,000 members in more than 140 countries.

“When credit checks are also executed, they usually are done at the end of the hiring process and are done for selected jobs for which the information is relevant,” said Kennedy. An association poll found that 47% of organizations conduct credit background checks on selected job applicants, and 91% of those are for jobs that include financial and fiduciary responsibilities.

More employers than ever—a 2011 CareerBuilder estimate put it at 45%—screen job applicants by looking for them on social media sites, such as Facebook, Twitter, LinkedIn and blogs. A more recent study by social media monitoring service Reppler showed that 91% of employers said they use social networking sites to screen prospective employees, and 69% claimed to have rejected a candidate because of something they found online.

While such social media sites can provide insights into potential employees, companies face the risk of violating anti-discrimination and privacy laws when doing so. Religion, ethnicity, sexual orientation and political affiliations or activities can all be cited in such lawsuits.

Opportunistic Criminals

Knowing your employees is integral to protecting profits. You must be able to trust them.

Earlier this year, an alert police officer in New York City stopped a vehicle at the Whitestone Bridge tollbooth plaza after smelling strong gas fumes and spotting an expired registration. Found inside: 410 gallons of gas, part of what police said was a black market gasoline stealing ring that had inside help from employees.

A BP station in Tampa, Fla. recently reported the loss of almost 450 gallons of gas when a minivan with a hole drilled in its bottom parked above its underground storage tank and began to siphon fuel into plastic drums. “It was like a James Bond movie where they parked on top of the gas tank, dropped a hose and an electric pump and there they go,” Lt. Larry McKinnon of the Hillsborough County Sheriff’s Department told one reporter. “If the prices start going up, it’s basic police 101—we know that thefts are going to start increasing.”

According to NACS Vice President of Communications Jeff Lenard, drive-off thefts was once the most common way that people stole gasoline. But when prices spike higher, crooks have greater ambition. “The idea is, ‘Why steal two gallons for a fill-up when there’s 10,000 gallons in an underground storage tank?’ It’s a sign of the value of the gas,” he said. “It’s not a sign of desperation. They are transporting to a meeting place and finding out how to sell it.”

The forces behind increases in gasoline theft are the same as those that have led to more cigarettes disappearing from stores. “When gas prices go down we see a little bit less theft,” said Rolland Trayte, a former retailer with more than 25 years of store security experience and the principal of Rolland W. Trayte Consulting in Scottsdale, Ariz. “Whether you believe it’s 9% unemployment or closer to 15%, the fact of the matter is that people are still cash-challenged, opportunistic and they will take advantage of you if your employees give them an opportunity to do so.”

So who wouldn’t want to take every step possible to prevent drive-offs?

“I will tell you that marketing guys generally think the opposite of what loss-prevention guys think,” insisted Trayte. “Historically, marketing guys want to put a product out there where people can touch it and feel it—and steal it. Security guys want you to turn over your drivers’ license and your first-born male child the minute you walk into the store.”

The reality is someplace in between. “I remember it used to bug me at Circle K when the marketing guys would pile two-liter bottles of soda at the gas islands or out in front of the store. Ultimately, the manager would report that half of his inventory outside was gone. And my response would be, ‘Duh?’”

From Trayte’s perspective—what he called “a true operations perspective—drive-offs can be minimized by adopting a prudent policy against loss by requiring prepay. “When you look at McDonald’s and all of these other quick-serve restaurants, the marketplace has conditioned us to pay before we receive our products. A solution to reduce shrink can be that simple.”

Cameras at the gas island, while seemingly a great idea, have proven largely ineffective in stopping drive-offs. One reason is that local cops simply don’t have time to follow up on reports of a $25 theft and view it as a store-solvable problem. But the second issue has to do with legal issues.

“You may have a picture of that car, and you may even have a good enough picture of the license plate, although frankly that’s rare,” Trayte explained. “But what you then need to do in order to prosecute is to put the driver behind the wheel. Somebody could say, ‘Well, I had my car in for service that day.’ In order to have all of the evidentiary value that is necessary for prosecution, you need the license plate, you need the car, but you also have to put the driver behind the wheel.”

Theft Inside

Fuel is also being stolen by clever employees, Trayte said “Employees will let their friends gas up, then do a gas drive-off report for the store. The police don’t want to hear it. Or, the employees may gas up their own cars before the end of the shift and write it off as a store loss.”

Another troubling scenario is that a customer may come in and place a $20 bill down on the counter to cover his gas purchase, but the employee simply pockets it.

Theft also takes place at locations that either cannot or choose not to lock the caps on the underground storage tanks.

“They may choose not to lock the gas caps so that the employees don’t have to go outside and unlock them when they get a tanker drop,” Trayte said. “It’s a much bigger problem than you would believe. The bottom line is that retailers have to take the time to hire properly and study the areas where they are vulnerable to thefts. When they do this effectively, they can develop a plan to protect their investments.”

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