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The Crown's Open Bar: How Ontario Unlocked the Liquor Cabinet for Organized Crime · Kvetch & Release

• 0:00
  Speaker 1: Good morning, John.
• 0:01
  Speaker 2: Good morning, Gene.
• 0:02
  Speaker 1: Love live radio. Hey, this is a great take today.
• 0:07
  Speaker 1: You know, between 1927 and 1969, the LCBO operated on
• 0:12
  Speaker 1: this strict Walton-Wickett system that made theft... from the LCBO
• 0:20
  Speaker 1: impossible you know I remember as a little kid going
• 0:22
  Speaker 1: to the LCBO with my uncle and what you would
• 0:25
  Speaker 1: do is you would go up to this sort of
• 0:27
  Speaker 1: a stand you would get this little form you would
• 0:31
  Speaker 1: get the shopkeeping unit number you would put that down
• 0:36
  Speaker 1: quantity of what you wanted you know one bottle and
• 0:39
  Speaker 1: And at the bottom, you would write in a price.
• 0:41
  Speaker 1: You would go to the cashier. You would pay for that.
• 0:44
  Speaker 1: The cashier would give this slip to somebody who worked
• 0:47
  Speaker 1: in the back. And a couple of minutes later, a
• 0:50
  Speaker 1: clerk would come out, and that bottle would be wrapped
• 0:52
  Speaker 1: up in regular brown paper, just making it impossible to
• 0:57
  Speaker 1: steal anything. But after decades of modernization, making the places
• 1:02
  Speaker 1: look upscale... You know, basically we turn liquor stores into
• 1:08
  Speaker 1: a buffet for organized crime and bad guys. I was
• 1:12
  Speaker 1: on Twitter a couple of days ago, and I witnessed
• 1:16
  Speaker 1: a robbery that somebody taped in an LCBO in Etobicoke.
• 1:21
  Speaker 1: You know, these guys just very calmly filling up their
• 1:23
  Speaker 1: shopping bags, walking out the front door. But security guards
• 1:27
  Speaker 1: hold no special police powers. And while the criminal code
• 1:31
  Speaker 1: permits citizen's arrest, for offenses committed on the property, guard
• 1:36
  Speaker 1: companies and retailers routinely mandate hands-off. And basically, the thieves
• 1:41
  Speaker 1: can just walk out the door with thousands of dollars
• 1:45
  Speaker 1: in liquor while the guards stand back and watch. I
• 1:48
  Speaker 1: witnessed a theft in an LBCO about a half a
• 1:52
  Speaker 1: year ago, and I said to the woman, I said,
• 1:54
  Speaker 1: why aren't you going to do anything? And she said,
• 1:56
  Speaker 1: I make just over minimum wage, and I have two children,
• 2:00
  Speaker 1: and I'm not going to put my life at risk here.
• 2:02
  Speaker 1: And perhaps my kids won't have a mom to come
• 2:06
  Speaker 1: home to today because some guy who's probably half-hammered wants
• 2:10
  Speaker 1: to steal a 40-pounder of vodka. And how can you
• 2:13
  Speaker 1: blame her?
• 2:14
  Speaker 2: Oh, you can't blame her whatsoever, Gene. And this is
• 2:17
  Speaker 2: the problem, right? We're not paying for security at these establishments,
• 2:21
  Speaker 2: at our liquor stores across the province. We're essentially doing
• 2:25
  Speaker 2: low-budget versions of The Wizard of Oz and renting human
• 2:28
  Speaker 2: scarecrows to try to scare people away. We spend millions
• 2:32
  Speaker 2: to park unarmed guards, and they're not even fluorescent vests
• 2:35
  Speaker 2: down here in Windsor. They're black vests, and they hang
• 2:37
  Speaker 2: out at the door. And the actual job is to
• 2:40
  Speaker 2: sort of be like they're just polite eye contact greeters,
• 2:44
  Speaker 2: and they act as state-subsidized witnesses to robberies. The store
• 2:48
  Speaker 2: says don't touch the criminals. The guard firms don't want
• 2:52
  Speaker 2: the liability. So, again, the guard functions almost as a
• 2:55
  Speaker 2: Walmart-type greeter who watches you steal public assets paid for
• 3:00
  Speaker 2: by you, me, and the rest of Ontario taxpayers.
• 3:03
  Speaker 1: I remember last year in May, a bad guy stole
• 3:07
  Speaker 1: a whole transport trailer truck containing over 1,000 boxes of
• 3:11
  Speaker 1: Crown Royal from a secured yard in Windsor, with police
• 3:16
  Speaker 1: reporting a retail replacement value of just over a half
• 3:19
  Speaker 1: a million dollars. Only 66 boxes were recovered by the
• 3:23
  Speaker 1: time the eight people were arrested. So does this prove
• 3:27
  Speaker 1: that Ontario liquor crime has expanded far beyond simple shoplifting
• 3:33
  Speaker 1: into organized property crime targeting regional logistics?
• 3:38
  Speaker 2: I think so, Gene. I mean, look, nobody accidentally shoves
• 3:41
  Speaker 2: a thousand boxes of Crown Royal down their sweatpants, right?
• 3:44
  Speaker 2: I mean, you don't wander up to a half-million-dollar tractor trailer,
• 3:50
  Speaker 2: hitch a semi to it, and drive off because you
• 3:52
  Speaker 2: wanted to have a couple drinks with the boys on
• 3:54
  Speaker 2: the weekend. So, I mean, eight people arrested, only 66
• 3:58
  Speaker 2: boxes recovered. The rest was obviously flipped into the black
• 4:02
  Speaker 2: market pipeline before the tires on the truck were cold. So,
• 4:05
  Speaker 2: I mean, the entire supply chain has been compromised. And
• 4:08
  Speaker 2: as you said at the beginning, it's really almost an
• 4:11
  Speaker 2: open buffet drive-thru right now for organized crime syndicates, whether
• 4:15
  Speaker 2: it's in the stores or out of the stores. The
• 4:17
  Speaker 2: entire supply chain is compromised.
• 4:19
  Speaker 1: Yeah. The Convenience Store Owners Association said, His name is
• 4:24
  Speaker 1: Terry Yaldo. He's warning that solo clerks are facing escalating confrontations,
• 4:29
  Speaker 1: and it's only a matter of time before somebody sadly
• 4:33
  Speaker 1: loses their life because of these thefts. Now, I stopped
• 4:38
  Speaker 1: in at a gas station slash Timmy's this morning, and
• 4:43
  Speaker 1: the young lady working behind the counter was maybe 15.
• 4:46
  Speaker 1: Five foot four and I don't know, 90 pounds soaking wet.
• 4:51
  Speaker 1: And I was just thinking, my goodness, you know, and
• 4:54
  Speaker 1: I said, do you work overnight? And she said, yes.
• 4:56
  Speaker 1: And I was just thinking, why is she there alone
• 4:59
  Speaker 1: at 3 a.m. in the morning?
• 5:01
  Speaker 2: Yeah, and that's what's worrisome, Gene, because at the end
• 5:04
  Speaker 2: of the day, the corporate balance sheet doesn't bleed. It's
• 5:07
  Speaker 2: the 19-year-old clerk working the midnight shift who could end
• 5:10
  Speaker 2: up bleeding. Queen's Park expanded our alcohol sales into variety stores.
• 5:14
  Speaker 2: There was huge fanfare. They took victory laps around. The
• 5:17
  Speaker 2: Convenience Store Association was happy. And the government and everyone
• 5:20
  Speaker 2: else walked away from the potential of the security fallout.
• 5:23
  Speaker 2: And lo and behold, crime still exists. So if a
• 5:26
  Speaker 2: grocery chain loses stock, the accountant can write it off.
• 5:29
  Speaker 2: When a corner store gets hit, it's that solo worker,
• 5:32
  Speaker 2: often a student, who would be staring down the aggressive
• 5:35
  Speaker 2: crew over a 12-pack of beer, which is not worth it.
• 5:38
  Speaker 2: Treating minimum wage workers as safety, as an acceptable cost
• 5:42
  Speaker 2: of doing business, that's just bankrupt.
• 5:44
  Speaker 1: Yeah. You know, the new stores, self-serve, aesthetically, they're very beautiful. But,
• 5:50
  Speaker 1: you know, beautiful to my eye, but a shopping, well,
• 5:54
  Speaker 1: like I was saying before, you know, a buffet of
• 5:56
  Speaker 1: free alcohol. The old stores were very antiseptic looking, very,
• 6:02
  Speaker 1: you know, the bright lights. And just like the story
• 6:04
  Speaker 1: I was telling off the top here, when I would
• 6:06
  Speaker 1: go into the store as a little kid in about
• 6:09
  Speaker 1: grade four with my uncle, he had to fill out
• 6:11
  Speaker 1: the form. They went to the back. You know, in
• 6:13
  Speaker 1: spite of the aesthetics and the way the stores look
• 6:16
  Speaker 1: like now, should we turn back the hands of time
• 6:19
  Speaker 1: and go back to that system so there will be
• 6:22
  Speaker 1: no loss of life of a security guard and the
• 6:26
  Speaker 1: massive amount of shoplifting will just simply come to an end?
• 6:30
  Speaker 2: I don't know if we need to go back to
• 6:32
  Speaker 2: exactly that model, although there is something nostalgic, at least
• 6:35
  Speaker 2: for me, who didn't experience that idea of almost like
• 6:37
  Speaker 2: the banker's type environment that the LCBO was. For me,
• 6:41
  Speaker 2: when I was growing up and I went with family members,
• 6:44
  Speaker 2: they used to have the wine chiller at the front
• 6:46
  Speaker 2: with the rubber duckies that would go around in circles,
• 6:49
  Speaker 2: and it was all cold, and that was an evolution
• 6:51
  Speaker 2: as well. I like to put the hypocrisy into a
• 6:54
  Speaker 2: context of when we legalized cannabis here. They mandated that
• 6:58
  Speaker 2: windows be covered so you can't see anything. IDs were
• 7:01
  Speaker 2: checked at the door. Every single gram is locked in
• 7:04
  Speaker 2: the back of the business. You can't touch it until
• 7:06
  Speaker 2: you buy it. They literally copied the 1927 LCBO playbook
• 7:11
  Speaker 2: and strapped a green sticker onto it. But when it
• 7:14
  Speaker 2: came to expanding LCBOs or putting it into corner stores,
• 7:18
  Speaker 2: they didn't decide to do any of that. So we're
• 7:20
  Speaker 2: treating low-potency weed gummies like it's enriched uranium, but we're
• 7:24
  Speaker 2: treating hard liquor like it's chewing gum. I mean, it's nuts.
• 7:26
  Speaker 2: We took all of that institutional knowledge and threw it
• 7:29
  Speaker 2: out and then tried to duplicate it for something that's
• 7:32
  Speaker 2: not nearly as harmful.
• 7:33
  Speaker 1: Well, it's interesting. I noticed that the Ontario government is
• 7:37
  Speaker 1: thinking of mandating that you have to have two people
• 7:40
  Speaker 1: in a cannabis store. Whereas, like the young lady in
• 7:45
  Speaker 1: the gas station slash Timmy's place, it's loaded with wine
• 7:50
  Speaker 1: and beer and all the rest. But it's just her
• 7:53
  Speaker 1: alone in the middle of the night. You know, do
• 7:55
  Speaker 1: you think Ottawa should reconsider existing criminal legislation again? and
• 7:59
  Speaker 1: whether it adequately addresses repeat organized retail theft.
• 8:04
  Speaker 2: Yeah, I think so. Look, the syndicates read the code, Gene.
• 8:08
  Speaker 2: They know the dollar thresholds. They know the police response times.
• 8:11
  Speaker 2: They know the system has zero teeth. So organized crime
• 8:14
  Speaker 2: is treated like a minor nuisance in our society. And
• 8:18
  Speaker 2: that's the biggest problem that we have. And we also
• 8:21
  Speaker 2: have a revolving bail door system that we've talked about before,
• 8:24
  Speaker 2: where before the officer finishes paperwork, the guys back out
• 8:27
  Speaker 2: on the street. So Ottawa needs to treat repeat retail
• 8:30
  Speaker 2: theft rings as criminal conspiracies with escalating penalties. Ontario needs
• 8:34
  Speaker 2: to get serious on bail reform. And we just need
• 8:37
  Speaker 2: to get serious about this. It's taxpayer money at the
• 8:40
  Speaker 2: end of the day.
• 8:41
  Speaker 1: I know that after Manitoba, Liquor and Lottery Corporation introduced
• 8:46
  Speaker 1: what they called controlled double-door vestibules. mandatory photo ID scanning
• 8:52
  Speaker 1: after way too many thefts in 2019. Ripoffs dropped 90%.
• 8:58
  Speaker 1: You think this is something Ontario should take a look at?
• 9:01
  Speaker 2: I think so, absolutely. They were spending about $ 60, 000 a
• 9:04
  Speaker 2: pop in Manitoba. They spent $ 2. 5 million across 45 targeted locations.
• 9:09
  Speaker 2: The thefts dropped 90 points. But we don't need to
• 9:11
  Speaker 2: do it across all of our LCBOs, of course. You
• 9:14
  Speaker 2: don't need to do airlocks in quiet cottage country. But
• 9:17
  Speaker 2: you can retrofit the top 150 high-shrink urban stores. And
• 9:22
  Speaker 2: that wouldn't be that expensive, less than 1%. I did
• 9:24
  Speaker 2: some of the math of the LCBO's annual dividend. And
• 9:28
  Speaker 2: then for mom-and-pop corner stores, you could have an AGCO
• 9:31
  Speaker 2: security grant that could cover, I don't know, like $ 5, 000
• 9:34
  Speaker 2: for barriers at the counter, for panic buttons, for locks
• 9:37
  Speaker 2: for the coolers to ensure people can't walk out of it.
• 9:40
  Speaker 2: But I think at the end of the day right
• 9:41
  Speaker 2: now what we need is the second you scan a
• 9:43
  Speaker 2: government ID before someone touches a model. We need the
• 9:46
  Speaker 2: criminal business model to evaporate with that. So we should
• 9:49
  Speaker 2: pilot the Manitoba model. We should fund basic counter security.
• 9:53
  Speaker 2: And we should close the open bar that we've decided
• 9:56
  Speaker 2: to open here in the province.
• 9:59
  Speaker 1: Well said. Great take. Have a fantastic day. We will
• 10:03
  Speaker 1: talk to you 9.15 Friday morning.
• 10:06
  Speaker 2: Looking forward to it, Jim.
• 10:06
  Speaker 1: John Letke's Got a Take.