Crime costs to business.

• Author: Makool, Becky

Everybody pays when businesses get ripped off by scam artists, thieves and shoplifters.

Crimes against business cost Americans about $120 billion each year, according to an estimate by U.S. News & World Report. Crime costs come back against consumers - in the form of higher service fees, product prices and insurance rates - as businesses try to recoup their losses.

National law enforcement statistics for 1993 indicate crime overall decreased slightly from 1992 to 1993, but specific types of crime increased. The FBI's most recent Uniform Crime Report (UCR), which documents only crimes reported to law enforcement agencies, shows the total number of property crimes in Alaska fell slightly, from 28,816 to 28,795.

These figures may not be telling the whole story. Don Springer, marketing director/sales manager for Alaska General Alarm in Anchorage, thinks that "crime on the whole is on the rise, not just in Alaska. ... When you look at the statistics, what you're going to find is that almost half of all burglaries go unreported," he explains.

Insurance costs in Alaska have been increasing in response to crime against businesses. Steve Methner, public affairs specialist with State Farm Insurance in Olympia, Wash., explains, "Insurance costs will rise along with all the other costs in doing business and in the economy, because obviously stock prices and building costs and labor costs rise over the years. But as a general trend, the proportion (of crime against business in Alaska) and the amount of claim dollars paid for crime losses to businesses in Alaska have increased."

Methner adds, "Since 1980, this proportion has more than doubled, ... and this increase has actually been more than our national trend."

Finding Fraud

Fraud costs far surpass the losses incurred by such crimes as burglary and robbery, according to Sgt. Garry Gilliam, supervisor of the Anchorage Police Department's (APD) fraud unit.

As reported by the Better Business Bureau (BBB), the U.S. Office of Consumer Affairs estimates that fraud nationwide costs consumers at least $100 billion each year.

Rick Gilmore, president of the BBB of Alaska, estimates that telemarketing fraud alone costs Alaskans at least $10 million a year.

"I think we're a little more susceptible to telemarketing fraud than other parts of the country," he says, "because we're used to ordering merchandise and services over the telephone, even from companies in the Lower 48. And the scammers know that. ... We're...