A Silicon Valley executive is trading conference rooms for courtrooms this week, as he faces four felony counts of burglary. The accusation: running a barcode scam to buy LEGOs at a fraction of their actual cost.
"How?" you ask. Well, the man allegedly covered up barcodes with forged labels he created. It turns out it's not that hard to print these up at home. The result: he paid far less than retail value at checkout.
The retail industry doesn't track barcode fraud separately, but along with other losses, it all adds up to a pretty penny. We know that retailers lost over thirty-five billion dollars in 2010, due to the theft, fraud and switching and replacing barcodes on store merchandise. There are high-tech fixes such as RFID tags, but they come at a price.
Some of the expensive solutions are some of the newly designed checkout systems that detect weight. So all of the weight's measures are entered in every piece of information about that product comes in.
A cheaper line of defense is employee vigilance. Ninety to ninety-five percent of all products everywhere has a barcode, physically printed on the box or the label. They should know that if it is a sticky-back label with the barcode that should raise a red flag. So it goes back to training. Store should also make sure point of sale terminals display specific details when a product is to scan, so cashiers can match descriptions with physical items.