Somerfield saves on till fraud

Software will detect suspicious activity and reduce internal theft

Somerfield cuts internal till fraud

Supermarket chain Somerfield expects to save up to £5m a year by installing fraud detection software in all its stores.

The software detects suspicious activity at tills and has generated a return on investment in just three months, largely because of a reduction in internal theft.

Data from the tills is sent to a data warehouse for analysis by the Innovetra Fraud Alerter software and compared against performance indicators, says Somerfield’s director of commercial audit and security Andy Beach.

‘The software recognises events outside the 40 to 50 performance indicators and generates exception reports,’ he said.

‘This could include an above average number of rejected sales or refunds at a till and the audit and security team compares this against overnight sales data.’

The software provides detailed data direct to the laptops of the audit and security team each day.

It also provides greater visibility for more than half a billion transactions, to allow Somerfield to analyse the history of each case, and to calculate how much money it has lost and whether further action is required.

‘It has had a major impact on internal fraud, particularly opportunistic fraud, because staff now know that transactions are being monitored,’ said Beach.

‘We have 970 shops and about 8,000 tills, and we could not have monitored every transaction without this technology. We can now focus on areas that need to be looked at and have a greater handle on internal fraud.’

Beach says scalability of the system is vital because Somerfield has shops ranging from large supermarkets to small kiosks. It also has different point-of-sale systems, meaning the software has to be flexible.

Fraud is a major problem for most retailers, says Butler Group analyst Mark Blowers, and loss prevention technology allows firms to spot problems quickly.

‘Retailers had to wait until the end of the week when they received weekly sales data to identify problems,’ he said.

‘But a lot of money can be lost in that time if small losses are multiplied by hundreds of stores.

‘The return on investment is easy to prove, which is why this technology is becoming popular at larger retailers.’