CPP REVIEW, TODAYS LOSS PREVENTION

JACK TERNAN, CPP Zone Loss Prevention Manager Tuesday Morning Inc. ASIS CPP Review 8/14/01

HISTORICAL OVERVIEW
First codification of law 1800 BC Hammurabis Code Modern Police Roots Sir Robert Peel in 1829 COP, Crime Prevention first started 1980, Association of Chief of Police, made crime prevention as a standard police function. CPO Crime Prevention Officer a public servant with police powers. LPO Loss Prevention Officer private sector deriving authority from an employer.

LP FOUNDATION TOOLS
Five tools that form the foundation of a Loss Prevention program.

1ST LP TOOL
RISK ANALYSIS Estimating expected loss from a specific threat has 3 steps: 1. Loss Prevention Survey 2. Identifying vulnerabilities 3. Determining probability / frequency / costs Process leads to the Loss Prevent Profile.

LOSS EVENT PROFILE

LOSS EVENT PROFILE: 1. Type of Risk 2. Probability of Event 3. Criticality of Event

2ND LP TOOL
PLANNING Results in a design for reaching objectives must fulfill organizational goals Respond to: 1. What is cost? 2. Is it practical? 3. Is it cost effective? 4. Will Management support strategy.

3RD LP TOOL
EVAULATION A critical tool once program is implemented. Ways to do this: 1. Pre test / Post test design 2. Experimental / Control Group Design

4TH

LP TOOL

RESEARCH Four basic steps: 1. Statement of the problem 2. Hypothesis 3. Testing 4. Conclusion

5TH LP TOOL
STANDARDS Promotes uniformity; E.G., UL, NFPA, OSHA

CRIME ANALYSIS AND LP

Crime analysis, a systematic approach to studying crime problems, collects, categorizes and disseminates accurate, timely and useful information to line personnel. Four specific steps of crime analysis: 1. Data collection 2. Analysis 3. Dissemination 4. Feedback

LP MANAGER
Lets say something about the LP Managers role.

ROLE OF LP MANAGER
Reflects needs/objectives of upper management and needs to : 1. Establish Priorities 2. Develop Written Polices 3. Form integrated management teams

KEY QUESTIONS
Does LP Manager have: 1. Upper Management Support 2. Adequate Budget 3. Appropriate Level of Authority

CRIME PREVENTION

FOUR DS OF CRIME PREVENTION

DETER - criminal attacks DETECT attacks that occur DELAY attack to allow time for response DENY access to selected targets

ENVIRONMENTAL DESIGN
Environmental design, or physical planning, is an approach to crime prevention in residential and commercial areas by coordinating efforts of architects, loss prevention practitioners, and police.

CPTED
Crime prevention through environmental design (CPTED) advocates that the proper design and effective use of the building environment leads to a reduction in crime and the fear of crime.

CPTED 3 BASIC STRATEGIES

Natural access control Natural surveillance Barriers (Territoriality)

DEFENSIBLE SPACE
Written by Oscar Newman Strategies from a New York housing project. Essence of the concept is that better residential security can be brought about through environmental and architectural design coordinated with crime prevention methods.

ENVIRONMENTAL SECURITY (E/S)

Is an urban planning and design process which integrates crime prevention with neighborhood design and urban development. The basic premise of (E/S) design and redesign of urban environments so that crime opportunities are reduced. It has no effect on white collar crime.

REDUCTION OF CRIME THROUGH (E/S)

Increased perpetration time more difficult to commit crime Increased detection time enhanced by lighting, landscaping, etc. Decreased reporting time more observation by many people Decreased police response time

Defensible Space Concept

Territoriality attitude of maintaining perceived boundaries. Outsider quietly recognized, observed. Natural Surveillance ability of inhabitants to casually an continually observe public areas. Image and Milieu involve the ability of design to counteract the perception that the area is isolated and vulnerable to crime Safe Area high degree of observation by police

RISK MANAGEMENT
Next will will discuss the subject of risk.

CATEGORIES OF RISK
Personal Property Liability

RISK ANALYSIS
First tool is assessing risk. PML assesses vulnerability and responses to risk 1. Possible maximum loss if target is totally destroyed or lost. 2. Probable maximum loss is amount of loss a target is mostly likely to sustain

ALE
Annualized Loss Expectancy (ALE) this formula is used specifically when doing a quantitative risk analysis such as terminating if another generator should be added to the plan used when computing a return on investment (ROI)

Crime Risk Management

Risk Avoidance Risk Transfer ( Buying Insurance) Risk Abatement (Reduction) Risk Spreading Risk Acceptance (Wish for the best)

INSURANCE RATES
Insurance rates are dependent on two variables: 1. Frequency of claims 2. Cost of each claim

BONDS
BOND Legal instrument where one party agrees to indemnify another party if oblige incurs a loss from the person bonded. Type of Bonds: 1. Fidelity Bond if bonded employee after investigation to limit risk, violates the trust, the insurance indemnifies the employer. 2. Surety Bond Failure to perform as agreed (Contract Bond)

INTERNAL THREATS
Next we will discuss internal threats and losses.

PREVENTION FROM INTERNAL THREATS

Internal theft is the greatest on going threat to business. It is difficult to obtain accurate statistics as to shrinkage attributable to employee theft. Internal losses occur by several methods: 1. Pilferage stealing in small quantities over a long period. 2. Embezzlement taking money/property entrusted to their care. 3. Shrinkage loss of inventory through any means.

WHY EMPLOYEES STEAL

Personal Problems Environmental Influences Rationalization

THEFT TRIANGLE
Motivation ( Desire or Need) Rationalization Opportunity

DANGER SIGNS
Counter productive behavior Conspicuous Consumer Financial Irresponsibility Financially squeezed employee

Management Countermeasures
Internal Controls / Separation of responsibility Auditing (Inspect what you expect) Management Support Policy and Procedural Controls Hotline Thorough Investigation Confrontation with employee suspect Prosecution

PHYSICAL COUNTERMEASURES
Access control ID systems Lock / Key Controls Alarms CCTV Safes / Vaults

SAFETY
Lets review some LP safety issues.

SAFETY AND LP
Unsafe acts cause 85% of all accidents, unsafe conditions cause the remaining 15%. Incident is anything from serious injury to a breakdown in quality control Accident is an undesired event resulting in physical harm to a person or damage to property.

ACCEPTABLE WAYS TO REMEDY ACCIDENTS

Constant inspections Job safety analysis Early discovery of unsafe conditions Identification of hazards Investigation of all accidents and near misses as soon as possible

HAZMAT
Hazardous Material Program: 1. Identify hazards that are present 2. Know how to respond to an incident 3. Set up necessary safeguards 4. Employee training 5. MSDS (Right to Know Program) in place

PLANNING AND BUDGETS

PLANNING
Planning designed to fulfill organizational goals / objectives. Can be: Simple Complex Short term Long term

Budgets
Top/down Bottom/ up What is a budget a plan stated in financial terms. Types of budgets: Line item each item expressed by line Program expenses are appropriated for specific activities / program or project. Capital Budget infrequently purchased / high dollar items

A BUDGET REQUIRES ..
A manager to operate the plan in three dimensions: 1. The operation /project must unfold as planned. 2. The operation / project must take place when planned. 3. It will not exceed the planned costs.

BUDGET COSTS
Budget costs are classified under one three categories: 1. Salary expenses 2. Sundry expenses all non salary expenses 3. Capital Expenses which are physical improvements, physical additions or major expenditures for hardware, generally considered one time expenses.

Thank You
I hope you found this LP review helpful. I wish you all the best when you are taking your exam.