A Solution for the Retail Theft Crisis

Facial recognition enhances security, loss prevention

Facial recognition technology is not emerging. It’s here.

Millions of people already use artificial intelligence (AI)-driven facial recognition technology every day in the United States and around the world. Individuals from every demographic unlock their phones with their faces – instantly – multiple times per day. They use facial recognition for secure access to their financial accounts and to pass through airport security checkpoints quickly. Many retailers use face matching for both security and loss prevention.

In fact, new research reveals that senior retail executives cite facial recognition as a vital anti-theft measure. The United Kingdom-based research firm Opinion Matters surveyed 300 senior retail leaders in the U.S. and the U.K. about their top business challenges and the most effective solutions. Respondents listed the current “theft crisis” among their top concerns.

“Facial recognition technology was said to be the most effective measure deployed to date among food retailers, followed by security guards, license plate recognition technology and RFID tags, respectively,” according to Progressive Grocer.

At least 15 of the top 50 U.S. grocery stores now use facial recognition technology.

Violent organized retail crime thieves and other criminals stole $112.1 billon from retailers in 2022, according to the National Retail Federation. The public is understandably concerned about their safety in stores. Since 2022, criminals have killed more than 1,100 customers, employees and security personnel in U.S. retail settings, according to industry publication D&D Daily. A similar dynamic is playing out on the international stage. In April, U.K. Prime Minister (at the time) Rishi Sunak announced a £55.5 million ($70.5 million) facial recognition program to combat unprecedented retail theft and violence.

It should come as no surprise that retailers have turned to facial recognition in greater numbers, given the widespread adoption by consumers and government agencies. A majority of Americans surveyed by independent polling firm Schoen Cooperman Research supported facial recognition’s enhanced safety benefits and accuracy. Sixty-eight percent of respondents said the technology can make society safer.

In May 2023, the Transportation Security Administration (TSA) announced a $128 million expansion of its passenger biometric checkpoints in U.S. airports. Then, in January 2024, TSA officials announced the facial recognition program would grow from nearly 60 airports to more than 400.

The public’s embrace of the technology may be driven even more by its use at sports and entertainment venues. Major League Baseball has implemented facial recognition for ticketing and entry in some of its ballparks, with a planned expansion to more stadiums, and Universal has a new billion-dollar theme park opening in Orlando, Fla., next year that will use facial recognition for guest admissions, concessions and restaurants.

Retail and other commercial users of facial recognition technology also have noted the state-driven trend toward expanded facial recognition use with guardrails for consumer privacy. Commercial use of facial recognition is legal in all 50 states, though the 2008 Illinois Biometric Information Protection Act severely restricts applications in that state. As of July 2024, 20 U.S. states have general data privacy laws that protect consumer privacy while permitting retailer use of facial recognition for life safety, security and loss prevention purposes. Of course, there remain vocal opponents of all facial recognition uses, but it is important to note that recent efforts to restrict the technology have tended to fail because of a lack of public support.

Currently, there is no nationwide U.S. data privacy law, and no further action in Congress is expected on the proposed American Privacy Rights Act (APRA) until after the November 2024 elections. In May 2023, a Federal Trade Commission (FTC) policy statement reinforced facial recognition technology’s continued expansion for retail use cases. Seven months later, in December 2023, the FTC addressed the need for safeguards related to facial recognition technology use.

There remains an urgent need to take action against increasing threats and protect innocent retail employees and customers. To act fairly, retailers must identify the relatively few individuals responsible for the overwhelming majority of threats. Retailers and other commercial users are finding the most effective and accurate way to do this is by using AI-driven facial recognition technology with appropriate human oversight.