Face2Face with Nick Fisher, CEO, Facewatch – putting the record straight on facial recognition

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Nick Fisher, CEO, of Facewatch talks Face2Face with customers, partners and the public about the real issues of retail crime and how Facewatch is facing up to the challenge of providing a proven and powerful tool which deters and prevents retail crime and violence.

Transcription below:

The Full Film:

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Hi, I’m Nick Fisher and I’m the CEO of Facewatch. I’m coming on camera because I want to put the record straight about, a lot of the things I’ve been reading about facial recognition that are a little bit frustrating in some, in some cases and needs to be commented on from somebody who runs a business that at the heart of it is about facial recognition and data sharing. So bear with me while I express my views and tell you a little bit about Facewatch and why I think there’s a clear point of difference between how you may have read or understood how facial recognition works and how it’s used when it’s used in a very responsible fashion in the way that we use it today. So I think there’s a real place for facial recognition technology and the sharing of data, providing it’s done responsibly and very transparently and Facewatch has lobbied for transparency and some clear understanding within the government as to how we should be using this technology going forward.

But it certainly shouldn’t be driven underground. It’s a phenomenal tool if used correctly. I think it’s really important that we embrace new technology and specifically against the backdrop of increasing crime. There are 23,000 fewer officers than there were in 2010 and over the same period of time, 35% new types of crime. If you then take what gets published in the public domain, different forces across the UK saying that they’re not coming out to low-level crime anymore, it’s quite understandable. They don’t have the resources. Now, I spent 20 plus years as a shopkeeper, so I understand what happens in retail and all that does, it builds apathy, apathy for reporting crime. What’s the point? Nobody’s coming out, who are we educating at the end of all this, we’re educating the thief who knows there’s not many police around.

The police have gone public saying they’re not coming out to this anymore. And by the way, the shopkeepers said, there’s no point in reporting, happy days. And so the statistics all bear fruit. If you look at crime reported over the last five, six, seven years, it just keeps going up. And a recent independent report said it was at £11 billion in the UK now we’ve got to do something about that. And so when you’re talking about those sorts of numbers, they have a material impact on operating profit and net profit of businesses. We’ve been doing this for three years and what a transition it has been in the market in terms of the quality of algorithm production from when I first started in facial recognition to the point that we’ve only really released our technology in the last nine to 12 months. Because before then quite frankly I didn’t think it was good enough to use. It’s a  different story now though, this is a really powerful tool and we’ve got to embrace new technology. If we’re going to help fight crime.

 

Facewatch a really powerful tool

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We’re commoditising facial recognition. You need a standard HD camera and a license from Facewatch and away you go.  The same price as CCTV technology. So a retailer, let’s just take a corner shop, can have facial recognition for the same price as a good CCTV system. Now the difference between facial recognition and CCTV; CCTV fundamentally  records crime and therefore you have to report that crime to the police. And the police have said we don’t have enough resources to deal with low-level crime. Facial recognition provided by FaceWatch is proven to deter and prevent crime. And we’ve got some fantastic evidence where our subscribers have used Facewatch where they’ve seen significant reductions in crime in just 90 days of deployment.

 

So who benefits from Facewatch?

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Well, in my opinion, everybody benefits, the store has a lot less negative activity on-site, less loss on-site, therefore greater profitability. The feedback we’ve had from employees where we’ve deployed Facewatch is they feel much safer and I’m sure it makes communities and environment safer. In fact, our YouGov survey said in general that people welcome facial recognition. CCTV essentially records the crime as it happens Facewatch and facial recognition technology prevents and deters crime before it happens.

 

Facts about Facewatch

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So, let me deal with some of the facts and some of the misreporting of facial recognition. But let me specifically talk about Facewatch. Number one, we do not record and store data of innocent people. Number two, we do not track innocent people. Number three, we only operate on private property. We do not use facial recognition technology in public space, and this is wholly different from how the police and other organisations have been using facial recognition in public places.

 

How Facewatch works day today.

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So here’s my message to you as store owners, this how you can make FaceWatch work for you in your business. So we’ve commoditised the proposition you need a standard HD camera and a Facewatch license. But how does it work on a day to day basis? Well, it captures the image of everybody who walks into your environment. It takes an image and converts it into an algorithm. It sends the algorithm to the Facewatch watch-list and looks for a match. If there’s no match, the image is deleted. As I said before, we do not store and hold data of innocent people. However, if there is a match, it will send an alert to a mobile device or any device you choose in less than two seconds with the image that you’ve got on file or that we hold for you and the image of the subject of interest that’s  just walked through the door for you to match and compare and then it’s up to you how you handle that incident.   As a retailer it should be non-evasive typically what I was in retail is we approach nearly all customers and say hi, can I help you? If you’re an innocent person, you’re saying I’m just having a look and most people respond with just having a look. Then you can say, I’ll be right behind you if you need any help. That means two different things to do different people to a thief. It means you watching me. To me, it means that sounds very helpful

 

Facewatch and Data Management.

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Today. Everyone’s worried about data and so are we. We spent five years working with government bodies and, and uh, authorities to ensure that we are fully GDPR compliant with regards to managing and holding this special category data, which is facial recognition data on behalf of our clients. We manage, store and share that data proportionately and thematically with subscribers to face watch only and with no one else to give you the support and the training so that you and your teams can manage the system appropriately. All our data is secured in the cloud at tier three-level and Trustwave does penetration tests on our database frequently. So you can be confident that Facewatch knows how to manage and look after your data as we will be your data controller mitigating your risk.

 

So how effective is FaceWatch?

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Well, let me give you some examples of clients who have used FaceWatch recently. We are working with a big convenience food retailer who had quite a material problem of theft in a couple of their stores. Quite substantial numbers with no list. Facewatch deployed the service into their site and within 90 days they got a greater than 25% reduction in both sites That’s led them to ordering another 18 licenses and to fit Facewatch in 18 more of their stores. Since we deployed the technology, they have not reported one crime. We’ve gone into a small convenience store who reported losing circa £25,000 a year and has seen a greater than 30% reduction in crime. This is all in less than 90 days of deployment. These are all running and are now into contract. These people are using it and they’re becoming the advocates of Facewatch. It really does prevent and deter crime.

 

So where does FaceWatch work best?

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Well, we’re working with independent convenience stores, mom and pop stores who have deployed it because it’s highly affordable and as a great impact. We’re working with a national food retailer who now wants to consolidate and share data of a specific geography, so it’s very powerful the way it works in petrol forecourts, which are essentially now convenience stores that sell food. It works fantastically in shopping malls creating very safe environments. We’ve got a huge deployment with a shopping mall with a  70,000 footfall a day. They’re using it to really deter crime in their stores, down 70% year on year. It works absolutely everywhere. It’s a fantastic opportunity to be deployed in your business because it’s really affordable technology and it is proven to work.

 

Facewatch and self-help

So FaceWatch is about self-help. It’s about helping yourself and we work in partnerships, not just with our customers, but you have to work in partnerships with your customers. One of the things we insist on is absolute transparency. That means putting signage in your store, telling people you’re deploying facial recognition. One of the things that FaceWatch we’ll do is we’ll hold, store and share that data proportionally with other businesses in your area who subscribed to FaceWatch. You then start to build a really powerful tool to, to prevent and deter crime in your geography. Statistics reported by the ACS recently have shown that violent crime in specifically retail is on the increase and quite significant levels. These are people typically feeding habits , drug habits or drink problems. You know, we’ve had some fantastic feedback from subscribers to Facewatch saying that they feel safer in an environment where Facewatch is deployed and is a deterrent keeping these people away from their stores. They’re very transparent. The signage is their facial recognition deployed in here. They’d certainly don’t want to be caught on film. And as a consequence it’s easier not to go in an environment where you might be seen.

Final Thoughts

So I think facial recognition technology is like all technologies. I remember  when CCTV first came out and I was a junior retailer and everybody said this is big brother watching us and we won’t be able to go out.! There’s nearly 6 million cameras in the UK and about a half a million in London alone. It’s technology that eventually becomes part of society and people’s sort of, well they might not embrace it, they just accept that it’s there. I think that’s part of the problem in the retail landscape that people just appreciate their CCTV cameras here now and that they’re everywhere and therefore my mindset is that it’s not much of a deterrent. I think facial recognition will change the landscape. I personally believe that it will be a commonplace technology and in less than five years time, the markets forecast it to be somewhere around the £8 billion mark in the next three years.

So I think there’s a lot of investment going into it by companies and I think society needs it as a tool. There’s clearly not enough police officers around, , there’s going to be a huge challenge getting the 20,000 officers that have been mentioned by the government. I think we’re migrating towards a world of self-help and technology is a key partner in the evolution of, of helping people. And I just fundamentally believe facial recognition is a fabulous tool, but it has to be used with some form of very clear guidance and governance. It has to be used in a very transparent way and it has to be used and deployed by responsible organisations, people who take that responsibility seriously and with very clear guidance and training to end users.

And I think it will be a huge deterrent for crime going forward. I think the initial subscriber base will be the primary benefit of it, but I think as adoption grows, I think this will have a material impact on crime and it, you know, what I’ve learned from criminals is they definitely don’t want to be recognized. This is a technology that creates a quick alert of someone who creates crime, then it might just be a start to have a material impact in reducing crime across the UK. Our objective is to make Facewatch as a technology affordable. We’ve aimed at the retail sector and we’ve priced it at the same price as a good quality CCTV system. So this is my sales pitch;  If you’re interested, if you like what I’ve said, if you think this is a product for you, you have experienced retail crime, you want an affordable system where we manage the data for you.  You put the technology in and it will have a material impact and we’ve got some fabulous case studies that we would be happy to share with you.

Get in touch with us. We’re here to help you, a very friendly organization and we’ll, we’ll guide you through the process. Thanks for listening.

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The risks and rewards of facial recognition in retail – Retail Week reports

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By 27 August 2019

Facial recognition technology burst into the headlines this month following an exposé in the Financial Times about its use in London’s King’s Cross.

The Information Commissioner’s Office has launched an investigation into the use of the technology, which scanned pedestrians’ faces across the 67-acre site comprising King’s Cross and St Pancras stations and nearby shopping areas, without their knowledge.

It is the latest controversy to embroil the technology. Manchester’s Trafford Centre was ordered to stop using it by the Surveillance Camera Commission, which works for the Home Office.

Information commissioner Elizabeth Denham said after details of the King’s Cross scheme emerged that she was “deeply concerned about the growing use of facial recognition technology in public spaces”.

“Scanning people’s faces as they lawfully go about their daily lives in order to identify them is a potential threat to privacy that should concern us all”

Elizabeth Denham, information commissioner

“Scanning people’s faces as they lawfully go about their daily lives in order to identify them is a potential threat to privacy that should concern us all,” she maintained.

“That is especially the case if it is done without people’s knowledge or understanding. My office and the judiciary are both independently considering the legal issues and whether the current framework has kept pace with emerging technologies and people’s expectations about how their most sensitive personal data is used.”

The European Commission is also understood to planning new regulation that will give EU citizens explicit rights over the use of their facial recognition data as part of an update of artificial intelligence laws.

What’s it for?

So what does that mean for retailers that are either already deploying or are considering a roll-out of facial recognition technology in their stores?

Given the level of concern and scrutiny from regulators and public alike about how such technology is used, can retailers deploy it in a way that adds value to their business and without risking alienating customers?

Innovation agency Somo’s senior vice-president of product management Tim Johnson says: “There’s a very wide range of things [facial recognition] could potentially be used for. It is a very significant technology and a really seamless process that provides a strong form of identification, so it is undeniably big news.

“But at the moment it is a big muddle in terms of what it is for, whether it is useful or too risky and in what ways. We’ll look back on where we are now as an early stage of this technology.”

One area where facial recognition technology has been piloted by retailers is in-store to crack down on shoplifting and staff harassment.

“The only information held is on those who are known to have already committed a crime in the store previously”

Stuart Greenfield, Facewatch

According to the BRC, customer theft cost UK retailers £700m last year, up 31% year on year, while 70% of retail staff surveyed described police response to retail crime as poor or very poor.

Against that backdrop, retailers such as Budgens have rolled out tech from facial recognition provider Facewatch to stores across the South and Southeast, after a trial in an Aylesbury shop resulted in a 25% crime reduction.

Facewatch marketing and communications director Stuart Greenfield explains that clear signage is displayed throughout any store where the platform’s technology is used, and any data is held in Facewatch’s own cloud platform, not by the retailers.

“The only information held is on those who are known to have already committed a crime in the store previously, anyone whose face is scanned by the system and does not correspond against our existing watchlist is deleted immediately,” says Greenfield.

He believes it is the “combination of marketing, in-store signage and the system itself” which acts as a deterrent to shoplifting and staff harassment in stores where Facewatch’s technology is used.

Shopping centre operator Westfield has teamed up with digital signage firm Quividi, which analyses passersby’s facial data based on their age, gender and mood to determine which adverts are displayed as a means of driving customer engagement and sales. Shoe specialist Aldo and jeweller Pandora also work with Quividi overseas.

Quividi chief marketing officer Denis Gaumondie argues that the platform’s technology is not facial recognition – rather it is facial analysis, because it does not store any data on passersby and would therefore not recognise a repeat customer, or link their data to purchases.

He adds that it is the responsibility of Quividi’s retail partners to inform shoppers that the technology is in use.

Hot potato

However, DWF partner Ben McLeod, who specialises in commercial and technology law, says even using facial recognition or analysis technology in-store as described above could land retailers in hot water.

“There is a general prohibition on processing special category data [which may, for instance, include racial or ethnic origin] unless a specific exception applies,” he points out. “Many of the exceptions relate to the public interest which doesn’t really apply to retailers, particularly where the primary purpose for the use of the technology is marketing or to prevent stock loss.”

“Processing is possible where the data subject [the customer] has given explicit consent, but in practice, this will be difficult to demonstrate, as merely alerting customers to the use of facial recognition technology will not suffice.”

“Given that the basis on which the police are using surveillance technology is also currently subject to legal challenge, retailers are advised to tread carefully,” he cautions.

Opting in

Facial recognition technology is prompting controversy

Facial recognition has also been tried out by the Co-op to verify the purchase of age-restricted products such as alcohol at self-service checkouts. Customers found to be over 30 were allowed to complete the purchase without the need for verification by a member of staff.

Johnson believes such use of facial recognition technology would be welcomed by many customers because it would require their specific consent to use it, as was the case with the Co-op, as would verification of the purchase of a whole shopping basket using biometric data.

“People are comfortable with using facial identification on their own device [such as Apple’s Face ID], so using it as a means of verifying purchases in-store feels like a logical next step. It would speed up the check-out experience.”

Capgemini principal consultant Bhavesh Unadkat also points to the roll-out of Amazon Go stores in the US, which verify shoppers’ purchases and link them to their Amazon account using biometric data including facial recognition technology.

He explains that shoppers who download the Amazon Go app and then go into one of the checkout-free stores understand what technology is being used, and how it is benefiting them by providing an efficient shopping experience. The trade-off is clear and there is an “opt-in” to use the technology.

“I don’t think [retailers] can ask customers to opt out of facial recognition technology being used in-store, or just alert them to it being there,” he says.

“They need to ask shoppers to opt in and sell them the benefits they would get, such as a cashless checkout, more rewards, personalised offers to your mobile as you enter the store. Don’t go down the route of assuming people will never opt in and not communicating effectively, because if you get it wrong then the trust is broken.

“Right now we are making a mess of [facial recognition technology] because people are already paranoid about sharing information online and now feel like they are being victimised in a bricks-and-mortar environment as well.”

McLeod concurs with that view.

He says: “Amazon Go is the kind of thing where people are making a choice upfront by downloading the app. That is different from walking into a shopping centre or having the technology foisted upon you in a way that isn’t transparent.

“It becomes far more pervasive in that setting, but the more fundamental issue is there isn’t a strong legal grounding for the use of the technology.”

Right side of the law

Greenfield emphasises that Facewatch is working with the ICO to ensure its technology remains compliant with current and incoming regulations.

“We are pushing like mad for legislation as quickly as possible,” he says. “We want to do everything that is good for the technology because the reality is we cannot put the genie back in the bottle; [facial recognition] is out there and it will be used by someone, so we should have legislation to ensure it is used properly.”

Johnson advises retailers to collaborate closely with engaged suppliers and legislators, and tread carefully when deploying facial recognition technology, but does not believe that current controversies should deter retailers from using it for good.

He says: “I absolutely think [retailers] should still be exploring it. The current environment should make them fully aware of the risks, but it isn’t going away and the potential rewards are large, from crime prevention to age verification and flagging relevant products to customers.

“We’ll hopefully see a period of innovation which shows people what [facial recognition] is useful for.”

https://www.retail-week.com/technology/analysis-the-risks-and-rewards-of-facial-recognition-in-retail/7032744.article

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Crime against retailers and wholesalers continues to rise- New Gov report says

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By 5 September 2019 Convenience store magazine

Workers in the retail and wholesale industries continue to suffer from the highest levels of crime out of all key business sectors, with retailers who experience crime being targeted more often than in previous years, new Home Office data shows.

Shoplifting

The crime rate in the retail and wholesale sector has risen every year since 2015, from 12,400 incidents per 1,000 premises to 27,400 incidents in 2018, the latest Commercial Victimisation Survey (CVS) reveals.

The number of assaults and threats has also continued to rise year on year, up to 1,600 incidents per 1,000 premises in 2018, a marginal increase on 2017 but significantly up from 500 incidents per 1,000 premises in 2016.

Theft accounted for 82% of all incidents reported in 2018 and almost three-quarters (71%) of all incidents of theft was theft by customers, with 19,300 incidents per 1,000 premises in 2018.

Theft of food or groceries accounted for over a quarter of stolen items in 2018.

The repeat victimisation rate for theft specifically has almost doubled in recent years, from 49 incidents per victim in 2012 to 92 incidents per victim in 2018.

The overall rate of repeat victimisation has also risen from 32 incidents per premises in 2012 to 69 per premises in the 2018 survey.

The Association of Convenience Stores (ACS) said the survey highlighted the need for a more targeted approach to dealing with repeat offenders.

ACS chief executive James Lowman said: “These findings show that businesses are being repeatedly targeted by criminals that are not only committing thefts, but are also being abusive and violent towards retailers and their staff.

“We need targeted action to deal with repeat offenders who are currently being all but ignored by the justice system.

“The increase in the number of assaults and threats is especially concerning, as no one should have to face violence or abuse in their work but it is being seen as just part of the job for many in the sector.

“We continue to urge retailers and their staff to report every incident when it occurs to ensure that the police are aware of the full extent of the problem.”

Figures from the 2019 ACS Crime Report show that retailers believe 79% of crimes are committed by repeat offenders, with around half of those offenders being motivated by a drug or alcohol addiction.

Read reports here:

Full report

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/829399/crime-against-businesses-2018-hosb1719.pdf

PDF overviews

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/828765/crime-against-businesses-infographic-2018.pdf

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/828766/crime-against-businesses-factsheet-wholesale-retail-2018.pdf

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Facewatch exhibit at RETAIL RISK conference and exhibition in Leicester on 3rd October

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The Facewatch team will be exhibiting at the Retail Week conference in Leicester on 3rd October.

Taking place at the Leicester City Football Club stadium it is a free conference and exhibition for retailers.

To arrange a meeting with Geoff Gritton please email: geoff.gritton@facewatch.co.uk or call him on Mobile 07711 756754

 

 

Don’t Miss The Biggest Day on The Risk Management Calendar…

Retail Risk – Leicester, followed by the Fraud Awards Gala Dinner the same evening, promises to be an outstanding day of networking, round tables and main stage presentations.

Last year, key decision-makers and influencers from most of Europe’s top 250 physical and online retailers attended, making it one of the very best places to meet new business contacts and catch up with old friends. And this year promises an excellent roster of speakers and round table hosts too.

The conference also boasts one of Europe’s largest exhibitions of risk management solutions for both physical and online stores, including the rapidly growing area of distribution centre and logistics security. So it is a great place to discover new solutions vital to your business.

If you want to be part of the most eagerly anticipated days on the risk management calendar, it is quick, simple and easy to register.

And remember to bring the whole of your team and others from your organisation whose remit includes the ever-evolving risk management brief.

 

What makes Retail Risk the world’s No 1 Risk and Loss Prevention conference series?

More executives, whose work involves risk and loss prevention, attend our conference series than any other in the world. Here’s why…

Be inspired by fresh thinking from international speakers, many of whom only speak at Retail Risk events
Take away case studies of others who have “learnt the hard way” and use their experiences in your business
Free Access All Areas VIP Delegate Passes for retailers, academics and law enforcement personnel
Enjoy unlimited refreshments and a delicious hot lunch at a superb hotel – all complimentary
Vendor numbers are limited, so our delegates don’t get overwhelmed by unsolicited sales approaches
Carefully constructed networking opportunities with peers as well as our international experts
Workshops are held under the Chatham House rule, so you can be assured of complete confidentiality
Potential for personal international profile development
Opportunity to participate on future steering committees and influence agenda
International publicity for all speakers through www.retailrisk.com

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THE £1.9BN COST OF RETAIL CRIME – BRC

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Violence remains a key issue this year. On average, 115 retail employees were attacked every day.

The combined cost of spending on crime prevention and losses from crime to the industry is a staggering £1.9 billion.

Over £700 million was lost to customer theft alone, a rise of 31% on the previous year.

 

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The British Retail Consortium’s (BRC) annual Retail Crime Survey has revealed the vast cost of crime to people and businesses up and down the country.

The total cost of crime and crime prevention for retailers was £1.9 billion last year, up 12% from the previous year (£1.7bn). This was made up of £900 million direct cost from retail crime, and £1 billion spent in efforts to prevent crime.

The direct costs of crime included a £700 million loss arising from customer theft, a 31% rise on the previous year. The total cost of crime, at £1.9bn, is equivalent to approximately 20% of the estimated profits of the entire retail industry.

The human cost of criminal enterprise was also laid bare as the survey revealed that 115 retail employees were attacked at work every day. The use of knives by assailants was pointed out as an issue of significant concern.

Approximately 70% of respondents described the police response to retail crime as poor or very poor. And while opinions showed the police response was generally better for violent incidents, as compared to customer theft or fraud, only 20% of respondents considered the response good or excellent.

Helen Dickinson OBE, Chief Executive of the British Retail Consortium, said:

“Violence against employees remains one of the most pressing issues retailers face, yet once again we have seen an increase in the overall number of incidents. Such crimes harm not just hardworking employees, but also on their families and communities. No one should go to work fearing threats and abuse.

“The spiralling cost of retail crime – both in losses and the cost of prevention – are a huge burden to a retail sector that is already weighed down by the twin challenges of skyrocketing business costs and Brexit uncertainty.

“We hope this report will act as a catalyst for Police and Crime Commissioners around the country to take action. Retail crime should be explicitly addressed by Police and Crime Plans. Furthermore, Parliament must play its part in stemming this tide of crime by creating a specific criminal offence to protect retail employees from assault at work, as has been done for emergency workers.”

Retailers are spending 17% more on cyber-security than last year (£162 million), and nearly 80% of the retailers surveyed have seen an increase in the number of cyber attacks.

Clare Gardiner, the National Cyber Security Centre’s Director of Engagement, said:

“The NCSC is committed to helping to improve the UK’s cyber security, which is why we have worked in partnership with the British Retail Consortium to produce the BRC Cyber Security Toolkit.

“Cyber attacks can have a huge impact, but to help potential victims pro-actively defend themselves we have published a range of easy-to-implement guidance on our website.

“Organisations can also share threat intelligence in a confidential way through the NCSC’s online Cyber Information Sharing Partnership (CiSP), which increases awareness to dangers and reduces the impact on UK businesses.”

The BRC is working with a number of organisations to campaign for greater protections for retail workers.

Paddy Lillis – Usdaw General Secretary said:

“Life on the frontline of retail can be pretty tough for many shopworkers and there is still a lot to do to help protect them. We launched our Freedom From Fear Campaign in the face of growing concerns amongst retail staff about violence, threats and abuse. The campaign works with employers to promote respect and make shops safer for staff.

“It is time for the Government to act by providing stiffer penalties for those who assault workers; a simple stand-alone offence that is widely recognised and understood by the public, police, CPS, the judiciary and most importantly criminals. Shopworkers are on the frontline of helping to keep our communities safe, they have a crucial role that must be valued and respected.”

DOWNLOAD THE BRC’S ANNUAL CRIME SURVEY

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The Observer – Facial recognition… coming to a supermarket near you…

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Published in The Observer, by Tom Chivers, Sun 4 Aug 2019 09.00 BST

The technology is helping to combat crimes police no longer deal with, but its use raises concerns about civil liberties

Paul Wilks runs a Budgens supermarket in Aylesbury, Buckinghamshire. Like most retail owners, he’d had problems with shoplifting – largely carried out by a relatively small number of repeat offenders. Then a year or so ago, exasperated, he installed something called Facewatch. It’s a facial-recognition system that watches people coming into the store; it has a database of “subjects of interest” (SOIs), and if it recognises one, it sends a discreet alert to the store manager. “If someone triggers the alert,” says Paul, “they’re approached by a member of management, and asked to leave, and most of the time they duly do.”

Facial recognition, in one form or another, is in the news most weeks at the moment. Recently, a novelty phone app, FaceApp, which takes your photo and ages it to show what you’ll look like in a few decades, caused a public freakout when people realised it was a Russian company and decided it was using their faces for surveillance. (It appears to have been doing nothing especially objectionable.) More seriously, the city authority in San Francisco have banned the use of facial-recognition technologies by the police and other government agencies; and the House of Commons Science and technology committee has called for British police to stop using it as well, until regulation is in place, though the then home secretary (now chancellor) Sajid Javid, said he was in favour of trials continuing.

Paul Wilks, Owner Wilks Budgens

Paul Wilks. Owner of WilksBudgens

Wilks Budgens Store

There is a growing demand for the technology in shops, with dozens of companies selling retail facial-recognition software – perhaps because, in recent years, it has become pointless to report shoplifting to the police. Budgets for policing in England have been cut in real terms by about 20% since 2010, and a change in the law in 2014, whereby shoplifting of goods below a value of £200 was made a summary offence (ie less serious, not to be tried by a jury), meant police directed time and resources away from shoplifting. The number of people being arrested and charged has fallen dramatically, with less than 10% of shoplifting now reported. The British Retail Consortium trade group estimates that £700m is lost annually to theft. Retailers are looking for other methods. The rapid improvement in AI technologies, and the dramatic fall in cost, mean that it is now viable as one of those other methods.

“The systems are getting better year on year,” says Josh Davis, a psychologist at the University of Greenwich who works on facial recognition in humans and AIs. The US National Institute of Standards and Technology assesses the state of facial recognition every year, he says, and the ability of the best algorithms to match a new image to a face in a database improved 20-fold between 2014 and 2018. And analogously with Moore’s law, about computer processing power doubling every year – the cost falls annually as well.

In ideal environments such as airport check-ins, where the face is straight on and well lit and the camera is high-quality, AI face recognition is now better than human, and has been since at least 2014. In the wild – with the camera looking down, often poorly lit and lower-definition – it’s far less effective, says Prof Maja Pantic, an AI researcher at Imperial College London. “It’s far from the 99.9% you get with mugshots,” she says. “But it is good, and moving relatively fast forward.”

 

Each algorithm is different, but fundamentally, they work the same way. They are given large numbers of images of people and are told which ones are the same people; they then analyse those images to pick out the features that identify them. Those features are not things like “size of ear” or “length of nose”, says Pantic, but something like textures: the algorithm assesses faces by gradients of light and dark, which allow it to detect points on the face and build a 3D image. “If you grow a beard or gain a lot of weight,” she says, “very often a passport control machine cannot recognise you, because a large part of the texture is different.”

But while the algorithms are understood at this quite high level, the specific things that they use to identify people are not and cannot be known in detail. It’s a black box: the training data goes into the algorithm, sloshes around a bit, and produces very effective systems, but the exact way it works is not clear to the developer. “We don’t have theoretical proofs of anything,” says Pantic. The problem is that there is so much data: you could go into the system and disentangle what it was doing if it had looked at a few tens of photos, perhaps, or a few hundred, but when it has looked at millions, each containing large amounts of data itself, it becomes impossible. “The transparency is not there,” she says.

Still, neither she nor Davis is unduly worried about the rise of facial recognition. “I don’t really see what the big issue is,” Pantic says. Police prosecutions at the moment often rely on eyewitnesses, “who say ‘sure, that’s him, that’s her’, but it’s not”: at least facial recognition, she says, can be more accurate. She is concerned about other invasions of privacy, of intrusions by the government into our phones, but, she says, facial recognition represents a “fairly limited cost of privacy” given the gains it can provide, and given how much privacy we’ve already given up by having our phones on us all the time. “The GPS knows exactly where you are, what you’re eating, when you go to the office, whether you stayed out,” she says. “The faces are the cherry on top of the pie, and we talk about the cherry and forget about the pie.”

As with all algorithmic assessment, there is reasonable concern about bias. No algorithm is better than its dataset, and – simply put – there are more pictures of white people on the internet than there are of black people. “We have less data on dark-skinned people,” says Pantic. “Large databases of Caucasian people, not so large on Chinese and Indian, desperately bad on people of African descent.” Davis says there is an additional problem, that darker skin reflects less light, providing less information for the algorithms to work with. For these two reasons algorithms are more likely to correctly identify white people than black people. “That’s problematic for stop and search,” says Davis. Silkie Carlo, the director of the not-for-profit civil liberties organisation Big Brother Watch, describes one situation where an 18-year-old black man was “swooped by four officers, put up against a wall, fingerprinted, phone taken, before police realised the face recognition had got the wrong guy”.

That said, the Facewatch facial-recognition system is, at least on white men under the highly controlled conditions of their office, unnervingly good. Nick Fisher, Facewatch’s CEO, showed me a demo version; he walked through a door and a wall-mounted camera in front of him took a photo of his face; immediately, an alert came up on his phone (he’s in the system as an SOI, so he can demonstrate it). I did the same thing, and it recognised me as a face, but no alert was sent and, he said, the face data was immediately deleted, because I was not an SOI.

Facewatch are keen to say that they’re not a technology company themselves – they’re a data management company. They provide management of the watch lists in what they say is compliance with the European General Data Protection Regulation (GDPR). If someone is seen shoplifting on camera or by a staff member, their image can be stored as an SOI; if they are then seen in that shop again, the shop manager will get an alert. GDPR allows these watch lists to be shared in a “proportionate” way; so if you’re caught on camera like this once, it can be shared with other local Facewatch users. In London, says Fisher, that would be an eight-mile radius. If you’re seen stealing repeatedly in many different cities, it could proportionately be shared nationwide; if you’re never seen stealing again, your face is taken off the database after two years.

Carlo is not reassured: she says that it involves placing a lot of trust in retail companies and their security staff to use this technology fairly. “We’re not talking about police but security staff who aren’t held to the same professional standards. They get stuff wrong all the time. What if they have an altercation [with a customer] or a grievance?” The SOI database system, she says, subverts our justice system. “How do you know if you’re on the watch list? You’re not guilty of anything, in the legal sense. If there’s proof that you’ve committed a crime, you need to go through the criminal justice system; otherwise we’re in a system of private policing. We’re entering the sphere of pre-crime.”

Fisher and Facewatch, though, argue that it is not so unlike the age-old practice of shops and bars having pictures up in the staff room of regular troublemakers. The difference, they say, is that it is not relying on untrained humans to spot those troublemakers, but a much more accurate system.

The problem is that, at the moment, there is very little regulation – other than GDPR – governing what you can and can’t do with a facial-recognition system. Facewatch say, loudly and often, that they want regulation, so they know what they are legally allowed to do. On the other hand, Carlo and Big Brother Watch, along with other civil liberties groups, want an urgent moratorium and a detailed democratic debate about the extent to which we are happy with technologies like these in our lives. “Our politicians don’t seem to be aware that we’re living through a seismic technological revolution,” she says. “Jumping straight to legislation and ‘safeguards’ is to short-circuit what needs to be a much bigger exercise.”

Either way, it needs to happen fast. In Buckinghamshire, Paul Wilks is already using the technology in his Budgens, and is finding it makes life easier. When he started, his shop would have things stolen every day or two, but since he introduced the system, it’s become less common. “There’s definitely been a reduction in unknown losses, and a reduction in disruptive incidents,” he says. As well as a financial gain, his staff feel safer, especially late at night, “which is good for team morale”. If enough retailers start using facial-recognition technology before the government takes notice, then we may find that the democratic discussion has been short-circuited already.

 

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ACS crime report – The biggest concerns for retailers are violence, theft and verbal abuse

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Crime Report 2019

The ACS 2019 Crime Report shows that crimes committed against the convenience sector cost an estimated £246m over the last year, equivalent to over £5,300 for every store in the UK, or what amounts to a 7p tax on every transaction.

The single biggest trigger for violence and abuse was shop theft. ACS estimates that there have been over a million incidents of theft over the last year, with retailers reporting that the vast majority of thefts committed against their business (79%) are by repeat offenders that aren’t being dealt with by local police forces.

Key findings from this year’s Crime Report include:

The three biggest concerns for retailers are violence against staff, theft by customers and verbal abuse against staff

The report estimates that there were almost 10,000 incident of violence in the sector over the last twelve months

Of crimes committed where a weapon was present, the most commonly used weapon was a knife (68% of incidents)

The report also shows that there is a clear link between retailers just doing their jobs by upholding the law, and being subject to abuse. The top three triggers for aggressive or abusive behaviour are challenging shop thieves (1), enforcing age restrictions, for example refusing a sale to someone without ID (2) and refusing to serve drunks (3).

Download the 2019 Crime Report

Watch video highlights here

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Facewatch partners with Store Excel to help retailers embrace facial recognition

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Facewatch is leading the drive to support retailers in reducing store theft, staff violence and abuse which has seen an unprecedented rise in recent months by partnering with Store Excel.

Store Excel is the fastest growing online and digital community of independent retailers in the UK. Their aim is to support retailers by providing an interconnected network of information, advice and business growth opportunities.

David Gilroy, CEO, Store Excel:

“Store Excel exists to support retailers and to provide information and access to the latest and best products and services. We understand that store security is becoming one of the most worrying issues for UK retailers and by working with Facewatch I believe we can alert our members to a new technology which will improve the environment for those who work in the sector and thereby improve the experience for customers and reduce losses. Store Excel will be using a combination of online communications and telephone marketing to speak to our members and help answer questions about facial recognition and its place in the sector. Technology continues to be a driver of innovation on the high street and it is important that facial recognition is explored as a new force for good”.

 

Nick Fisher, CEO, Facewatch:

“Facewatch is now market ready and has been undergoing successful trials in retailers across the UK for the last 12 months. We are now rolling out the solution to the whole UK retail sector and this starts with helping potential retail clients understand the way facial recognition works in a commercial situation and how effective it is. We have been very careful to ensure data compliance and have a unique approach by being the data controller. We have also commissioned market research to gauge public reaction to the technology which proved positive*. Store Excel also has a unique position in the sector, providing advice, new product and service information to their members and are a highly trusted voice, for us this is a perfect opportunity to partner with them”

Facewatch – product overview:

Facewatch provides retailers with a complete solution that enables store owners and staff to monitor who comes into their store using Facial recognition. A standard HD camera is set up to capture facial images of customers as they enter the store. Each image is checked against a watch list of images, managed by the Facewatch secure cloud, and if there is a match of a ‘person of interest’, who has been added to the stores watch list previously, an alert will be sent to the manager’s phone. The system uses the latest facial recognition algorithms providing a very high level of accuracy, it is easy to install by security industry professionals and to use by non-technical operators. Images captured by the system who do not match an image on the watch list are immediately and securely deleted. The Facewatch system complies to all the required codes of conduct under European GDPR rules as Facewatch is the official data controller.

Recent testimonials from Facewatch trials

Luton Town FC

“We installed Facewatch in our Luton Town FC Store 5 months ago as a result of continued theft of high-value stock. Since the system went live our losses have reduced by 100%. This is an outstanding result and the savings made have enabled us to fund the entire installation and 3 years license fees. We will roll out Facewatch to our stadium shop in May 2019. I would highly recommend Facewatch to any retailer experiencing any type of theft or anti-social behaviour”.
Siobhan Kos-Hodge, Luton Town FC, Head of Retail

 

Wilks Budgens, Aylesbury

“Since installing Facewatch we have seen a reduction in losses of over 25%. Using Facewatch technology is a significant enhancement from the existing solution where we have to log on to the web to view images of Subjects of Interest and try to remember them all. The Facewatch team, especially George, has been great to work with and I would highly recommend their technology and the people that work at Facewatch too.”
Paul Wilks, Owner Budgens Aylesbury

*References #1

YouGov managed independent public poll to ask a number of key questions regarding facial recognition with summary below: (2,029 polled)

86.2% Agreed that Facial recognition technology can be used in everyday life to prevent and solve crime and should be used to support businesses and the police
76.4% agreed if facial recognition technology does not store my image unless I am a person of interest. I would be happy to have my face scanned by these cameras
92.5% agreed that local businesses and the police should be working together by sharing images to prevent and solve crime
66.5% were confident in the accuracy of facial recognition technology to identify the correct person of interest
72.6% agree they would feel more comfortable visiting venues that I know are protected by facial recognition systems

Reference #2

Association of convenience stores 2019 report:

https://www.acs.org.uk/research/crime-report-2019

The 2019 Crime Report shows that crimes committed against the convenience sector cost an estimated £246m over the last year, equivalent to over £5,300 for every store in the UK, or what amounts to a 7p tax on every transaction.

The single biggest trigger for violence and abuse was shop theft.

ACS estimated that there have been over a million incidents of theft over the last year, with retailers reporting that the vast majority of thefts committed against their business (79%) are by repeat offenders that aren’t being dealt with by local police forces

The three biggest concerns for retailers are violence against staff, theft by customers and verbal abuse against staff

The report estimates that there were almost 10,000 incidents of violence in the sector over the last twelve months

Of crimes committed where a weapon was present, the most commonly used weapon was a knife (68% of incidents)

The report also shows that there is a clear link between retailers just doing their jobs by upholding the law and being subject to abuse. The top three triggers for aggressive or abusive behaviour are challenging shop thieves (1), enforcing age restrictions, for example refusing a sale to someone without ID (2) and refusing to serve drunks (3).

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Stand up to shoplifting – Convenience Store Magazine reports:

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Unable to rely on the police for help, many retailers are adopting new security measures to defend their stores from light-fingered offenders

Convenience store magazine

Ask retailers how a particular category performs in-store and you’ll get an array of answers, from tobacco to food to go. Quiz them on the best symbol group and the debate might rage for hours. But ask what impact shoplifting is having on the sector, and the answer is unanimous. “Shoplifting is bad at the moment – as bad as it’s ever been,” says Paul Stone, who owns the Stone’s Spar group of stores in Manchester.

“It’s prevalent,” echoes Jonathan James, owner of James Convenience Retail, which comprises 66 stores across the belt of England.

In its 2019 Crime Report, the Association of Convenience Stores (ACS) estimates that the incidents of shop theft have increased over the past year, despite figures from the Office for National Statistics showing that shop theft reported to the police has declined. In fact, many retailers surveyed by the ACS claim that the response they receive from the police actively deters them from reporting incidents.

“Shop crime’s not really getting followed up by the police,” says Middlesbrough Go Local retailer Bay Bashir. “Everyone’s talking about it at the moment.”

Spar Lindford owner Julian Taylor-Green agrees: “Our relationship with the police is a nightmare. The government are cutting costs, the police are then cutting costs and then blaming central government, and the people that are being held to ransom are the likes of us.

“It’s very difficult to get the police to commit to anything at all.”

With police across the UK failing to take action against shoplifters, many retailers are taking matters into their own hands and upping their security measures in a bid to reduce the problem.

Mark Canniford, owner of Spar Loxton Road, Weston Super Mare, and newly elected town mayor, has found chiller door alarms to be a cost-effective deterrent.

“We’re always trying to make it harder for shoplifters all the time,” he says. “We’ve started using little alarms on our doors which put shoplifters off because they know as soon as they hear the alarms that we’re looking. It was [Londis retailer] Steve Bassett who got me onto it – you can buy them from a DIY store. They can pay for themselves in days, rather than years. Because everyone knows what they [the shoplifters] are doing, they tend to behave themselves.”

Another low-cost way to protect your store is through layout and Paul has recently changed around his Princess Street store to deter shoplifters. “It used to be that you would walk in and if you turned right, you’d be in the sandwich area, and if you went straight in you’d be in the centre of the store,” he explains. “We’ve stopped that turn right so that everyone has to walk into the middle of the store – they can’t just grab and go. We’ve put stacks of low-value products, such as water, on the shopfloor, which is too heavy and not worth enough to shoplift.”

Jonathan has also experimented with what he calls “defensive merchandising”.

“You’re putting the stock on shelves that you know will sell in the next couple of days – the right number of facings, but not deep. You’ll see four bottles on-shelf, rather than 10, and top it up regularly. We’ve filled shoplifting hot spots with sharing bags of crisps and toilet roll multipacks. We also use convex mirrors so that they can’t hide round corners.

“At one store we had two entrances, so we’ve shut one off completely and we’re looking to have one entry and one exit past the till.”

In some cases, more extreme measures are necessary. When one of his stores was losing up to £1,000 a week through theft, Jonathan called on the East of England Co-op’s Secure Response Group.

“On a temporary basis for six weeks we hired store detectives,” explains Jonathan, “one out in the back looking at the cameras and suspicious behaviour, and one at the door waiting to stop people.

“The results were staggering – I think we got 39 in the first week and 103 over six weeks. Once we said enough’s enough staff morale improved massively and so did staff retention. The thieves realised we won’t stand for this. It worked brilliantly all round.

“Going forward, any time we get high levels of stock loss we’ll use EoE to step in and help for a month or six weeks. A store detective doing a 40-hour week costs £580 on a temporary contract, but our shop theft was costing £1,000 a week – it was a business decision. We need it all the time, but unfortunately we can’t afford it.”

Another deterrent is CCTV. “We’ve always put a big customer-facing screen at the front of the door and a good camera – it’s a really good deterrent,” says Paul.

He claims that retailers not only need to ensure that their cameras are good quality, but also that their digital video recorders(DVRs) are up to the job. “Technology improves and cameras are higher definition, so you have to make sure they’re up to date. We’ve got to the stage where the latest cameras are better than the DVR,” he says.

“If you’re recording on 28 cameras and have to take a month’s worth of footage, you can save images, but if the memory isn’t good enough then they’ll be lower res. We started with a one terabyte DVR and now we’ve invested in eight terabytes.”

Chris Grocott, director at Cricklewood Electronics, has witnessed retailers facing similar issues. “With old cameras, you could get a month’s worth of recording on a terabyte. But with the new HD cameras one terabyte may only last a week.

“We get people phoning up saying ‘How can I see footage from three weeks ago?’ But the camera only has one week’s-worth of recording as it automatically overwrites older data.”

Lee Jasper, head of marketing and product solutions group at ADT, agrees that the issue needs addressing. “For businesses that experience a high level of footfall, someone may be consistently committing a crime against them over a period of time, meaning that, for a case to be proven, footage over a more prolonged period may be required by law enforcement.”

Beyond their traditional role of capturing visual evidence of criminals in the act, cameras can also help to identify shoplifters as soon as they enter the store, thanks to the development of facial recognition systems.

Facewatch shop door 2

“Facewatch uses the latest algorithms to identify biometrics of the face and maps that in the cloud against known criminals,” explains Stuart Greenfield, marketing consultant for Facewatch. “Some 99% of stores have CCTV and on a daily basis they’ll do stock control and identify losses of certain products. They’ll then look at the CCTV to identify who took whatever was stolen. They can then get an image [of the shoplifter] from their CCTV and add it to their watch list.”

This could be extremely useful when you consider that retailers surveyed for the ACS Crime Report believed 79% of shoplifters are repeat offenders.

“If you’re a store manager, your mobile will alert you if someone walks into your store who has a known history of shoplifting or violence. The police can also add images to the database via the shop manager,” says Greenfield.

He describes how one convenience retailer it worked with had seen shoplifting fall 25% since using the system. “His staff are now much more relaxed, more confident and more happy to spend time with customers. All in all, it’s given him his money back in a couple of weeks,” Greenfield says.

He claims that there is also the potential for several retailers in an area to use Facewatch and then share information with one another on repeat offenders.

Jonathan claims that sharing intelligence with other retailers can really help. “I’d advise retailers to be proactive with other retailers – while we share customers, we also share thieves so why not talk to each other. Shopwatch schemes are really useful and helpful.”

How you choose to handle security comes down to the individual needs of your store, but if you are already losing a significant amount to theft, then an investment may quickly pay for itself, states ADT’s Jasper.

“There is no price affixed to peace of mind. That being said, owners should look at the occurrence and regularity of theft from their premises and go from there. If a convenience store is losing £5,000 of stock per annum to shoplifting, then this may be a good starting point for how much they should spend per year on securing their premises.

“The question for convenience retailers should not be ‘how much will it cost me to have security?’, but should instead be ‘how much will it cost me not to have security?’.”

Simple steps to curbing crime

To make any investment in a security system as beneficial and as cost effective as possible, there are a number of additional measures retailers should take to protect their business, according to security experts ADT:

  • Low tech deterrence – techniques such as mirrors in aisles and visible signs against shoplifting can help deter criminals
  • Effective inventories – if stock loss is happening, business owners need to know where it is coming from. It might be that additional security is needed in certain parts of a store where shoplifters are able to operate more freely
  • Educate employees – ensure that employees are aware of the risks of shoplifting and theft. They need to be more aware during peak times, beware of customers wearing bulky clothing or carrying large bags, and of shoppers who spend too much time watching staff. Having vigilant staff is key to deterring shoplifters
  • Organise stores effectively – how a store is set out can be a deterrent to shoplifters. Convenience retailers should ensure that their store is designed so that staff have a clear line of sight through it, meaning that they can see the majority of customers and staff at all times. Expensive items, as well as those that are easy to steal, should be moved to the front of the store, near the tills where staff can see them
  • Illumination – if a store is as bright as possible, thieves will feel that they are less likely to get away with committing a crime. Good illumination will also assist CCTV cameras to obtain the best possible image quality.
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