Vancouver police bust ‘predatory’ baby formula fencing ring; one person arrested

Click to play video 'Police seize $50,000 worth of stolen baby formula' Police seize $50,000 worth of stolen baby formula
The Vancouver Police Department’s anti-fencing unit has recovered $50,000 worth of stolen baby formula that is being shipped to China. Rumina Daya reports – Nov 17, 2016

A 46-year-old suspect allegedly using a “predatory fencing method” that exploits the vulnerable population of the Dowtown Eastside (DTES) has been arrested following the seizure of approximately $50,000 worth of baby formula stolen from stores in Metro Vancouver.

Global News learned about the Vancouver Police Department’s anti-fencing unit bust on Wednesday and in a press conference this morning, VPD Detective Cst. Doug Fell went over the project dubbed ‘lactose intolerant.’

The unit’s investigation started after a tip to police in early October about a person who was buying large quantities of baby formula in the DTES. The fence was then allegedly shipping the stolen goods to China for a large profit.

Fell explained the fence was mobile and part of an organized retail crime group.

“They use a predatory method… they take our DTES drug-addicted person, who are disadvantaged and they put them to work,” Fell said.

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“We estimated this person has 10 to 20 people working for him on a daily basis. He’s paying 30 per cent on the retail value for every product they bring in and placing orders with them.”

The retail value of a baby formula is $33, but in the DTES it has a value of nine to $12.

Fells says it is different from the normally seen fencing operations, because the suspect was getting two-and-a-half times the cost in China [roughly $90 per package of baby formula].

“Normally we’d see [the fence] pay 10 cents on the dollar but now they’re paying 30 cents on the dollar, which encourages the person who is stealing it to steal more and get a good pay day,” Fell said.

“We conducted our surveillance and we saw multiple ‘boosters’ [or thieves] every day carrying as much as 26 formula products a day.”
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Police suspect the fence was getting up to 100 or more formula units a day and has been in operation for about a year.

The police investigation uncovered one male suspect, who was living in a rented apartment where he stored some of the stolen baby formula and a second Strathcona residence that housed a large amount of the formula.

A small Vancouver business also linked to the suspect was searched, where police found another stash of the formula.

On Nov. 8, the man was arrested and his vehicle was seized by police. He has since been released from custody pending further investigation and the approval of criminal charges.

Police, in consultation with loss prevention officers, believe the suspect could be responsible for 70 per cent of the thefts of baby formula in the Metro Vancouver area. Fell estimates that in the last year this suspect has been responsible for moving $200,000 in baby formula.

Tony Hunt, GM for loss prevention for London Drugs, says a crime like this highlights the dangers of theft in retail.

“By praying upon the most vulnerable and needy individuals of our society the organized criminals behind these stolen property operations… they encourage these thefts of large quantities of merchandise,” Hunt said.

“The thefts that take place, they’re not simple acts of impulsive shoplifting. The people committing these thefts are often very desperate and they have to commit numerous thefts a day in order to fill their need. [Which then makes them] prone to violence against retail staff.”

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The theft of baby formula is becoming such an issue that some drug stores are resorting to locking it up alongside other high theft items like perfumes and razors, Hunt said.

Describing the operation as “fluid,” Fell said the suspect would ship stolen formula by using acquaintances heading to China or through FedEx with each box being worth $300 to $400 each.

Police have put forth a recommendation for charges that include counseling to commit offences, trafficking in stolen property and possession over $5,000.

Police are expected to recommend further charges against two additional suspects.

The investigation is on-going and while police said baby formula theft rings still exist in the Lower Mainland, they do not believe there are any other groups that are operating on the same scale.

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