A Labour MP calling civil recovery a ‘racket’ is the latest episode in an ever-more bitter dispute between Citizens Advice and their legal supporters, and companies acting for retailers to recover money from shop thieves. As background, Citizens Advice (CAB) has sought for some years to highlight civil recovery companies in reports such as Unreasonable Demands, in 2009, when for instance CAB claimed that civil recovery firms’ letters, and their threat of escalating costs, constitute ‘deceitful’, ‘unfair’ and ‘improper’ business practice, as defined by the Office of Fair Trading.
The civil recovery firms have pointed out that they are seeking to recover costs (work by security guards, for instance) for their clients – high street retailers – after thefts, that the police either cannot or will not handle. According to those in the civil recovery field, even if police do deal with offences, the offender is given a caution for a so-called low-level offence and the retailer is left out of pocket.
A recent development is a Oxford County Court case of May 9 when BWB (the legal firm Bates Wells & Braithwaite) acted pro bono for 21-year-old and 19-year-old women who cannot be named for legal reasons. The county court judge found against the claim – for £137.50 between the two women. The civil recovery firm RLP and BWB made quite different comments afterwards. According to BWB, the judgment dealt a potentially fatal blow to the use of ‘civil recovery’ by retailers and their agents, and represented a major victory for Citizens Advice. RLP meanwhile pointed to another, May 11 case at Northampton County Court when the judge found in favour of the claim for recovery of costs – security officer time dealing with the incident, and the work afterwards, including the civil recovery notice. RLP has also offered other cases of unnamed thieves, where the retailer seeks to recover money, such as from a member of staff dismissed for stealing; from the till; another shop worker, who did fraudulent refunds for £1864 over a four month period – given a caution by police; a manager who stole charity money and cash from tills; another manager who put his girlfriend on the payroll and drew over £10,000 in salary, before being discovered; and prolific and convicted shop thieves.
Retailers using civil recovery companies ‘seek to extract an estimated total of £15 million from poor and vulnerable people’, an MP has claimed in the House of Commons.
Speaking about the Defamation Bill in the Commons on June 26, Labour MP for Rotherham Denis MacShane claimed that civil recovery was ‘a £15m racket used by a lot of major companies—corporate groups—such as Boots, TK Maxx, Primark, Debenhams, Superdrug and Tesco’. “They are all shops that we use. These bodies corporate are going to another body corporate called Retail Loss Prevention and getting it to obtain money from very vulnerable people. When the CAB, also a body corporate, seeks to take up the cases, it then faces defamation writs from Schillings.”
Earlier in parliament Mr MacShane said that ‘the law firm Schillings is showering defamation writs on the Citizens Advice Bureau—one of the most prestigious and respected of all the voluntary organisations that we all have relationships with—as well as the law firm Bates Wells and Braithwaite, the Justice Gap website and the consumer websites Legal Beagles and Consumer Action Group’.
“Why is Schillings doing that?” MacShane said to MPs. “It is because there is an extremely unpleasant practice now taking place in our retail industry—developed, I am sad to say, under a Labour Government—called civil recovery. In essence, 90 per cent of all shoplifting in our stores is organised by gangs. About 8pc or 9pc is done by in-house stealing. The tiny 1pc is done—frankly, for the most part—by rather sad people. I am not condoning shoplifting; none of us would. Quite a lot of people who walk out of Tesco or Boots have not put in the correct barcode. We have all had that problem now since we have had to, as it were, do our own till accounting. Then the people are pulled back into the shop, taken into a little room and told that they could face prosecution, but Tesco, TK Maxx, Boots or Primark will not prosecute. Instead they will ask for names and addresses and a few weeks later a company in Nottingham called Retail Loss Prevention, which is owned by one person—Mrs Jackie Lambert—sends a threatening letter to the person saying that unless they immediately pay £150 or £180, they may face prosecution.
“Most of the people are children or adolescents, often from families without much structure. They are terrified out of their wits. Retail Loss Prevention—this Jackie Lambert person—says that this practice has been approved by the Association of Police Chief Officers and is thoroughly legal. It is not. It is a threat to obtain money, because the point of detention is not to go forward and hand the shoplifter—if that is the case, and we are not condoning it—over to the police for prosecution.”
