The Intricacies of Organized Crime Targeting Retailers such as Ulta, T.J. Maxx, and Walgreens

In an affluent suburban enclave nestled within the San Diego foothills, law enforcement authorities allege the existence of an organized retail crime empire orchestrated by a “queenpin.”

Secluded behind the imposing stone walls of her expansive 4,500-square-foot Spanish-style mansion, Michelle Mack purportedly amassed a considerable fortune in pilfered cosmetics from Ulta and Sephora outlets nationwide, according to officials.

Although authorities do not suspect direct involvement in the thefts by Mack, 53, they assert that she operated from the shadows, overseeing a network of approximately twelve women who carried out the thefts on her behalf, facilitating resale on Amazon.

With Mack covering their airfare, car rentals, and other expenses, the alleged perpetrators embarked on a spree of hundreds of thefts spanning the Californian coastline and reaching into Washington, Utah, Oregon, Colorado, Arizona, Illinois, Texas, Florida, Pennsylvania, Massachusetts, and Ohio, investigators claim.

Mack purportedly dictated which stores to target and which merchandise to plunder, dispatching the women to clear entire shelves before absconding with the stolen goods concealed within luxurious Louis Vuitton bags.

Dubbed the “California Girls” by investigators, the theft syndicate was allegedly led by Mack, who purportedly amassed millions by reselling the stolen merchandise on Amazon, often at significantly reduced prices, unbeknownst to the buyers, before her arrest in early December.

The Intricacies of Organized Crime Targeting Retailers such as Ulta, T.J. Maxx, and Walgreens
Michelle Mack’s home in Bonsall, California (Credits: CNBC News)

Law enforcement officials assert that Mack’s purported theft syndicate is just one among many plaguing retailers across the United States, resulting in annual losses amounting to billions of dollars. This surge has prompted numerous companies to secure merchandise, employ security personnel, and advocate for stricter legislative measures.

These organized theft groups typically eschew the dramatic “smash and grab” robberies witnessed in viral videos. Instead, they operate swiftly, quietly, and efficiently, often within intricate, organized frameworks that bear resemblance to the corporations they target, according to law enforcement.

They have observed instances of petty shoplifting involving individuals appearing homeless or mentally unstable, as well as crackdowns on alleged organized theft groups peddling stolen goods at flea markets.

Of all the groups tracked alongside police, Mack’s network, spanning from her alleged team of professional thieves to her lucrative Amazon storefront, emerged as the most sophisticated.

The Intricacies of Organized Crime Targeting Retailers such as Ulta, T.J. Maxx, and Walgreens
Scott Robles of Homeland Security Investigations was in charge of the Assistant Special Agent. (Credits: CNBC News)

However, federal agents from Homeland Security Investigations (HSI), the enforcement arm of the Department of Homeland Security, reveal that some criminal enterprises are even more intricate, with theft being just one facet of their operations.

Adam Parks, an assistant special agent in charge at HSI, based in Baton Rouge, Louisiana, highlighted the complexity of these operations, citing fleets of trucks and 18-wheelers laden with stolen goods, as well as cleaning crews tasked with refurbishing stolen items to pristine condition.

Parks likened these operations to conventional business endeavors, complete with investments in assets like shrink-wrap machines and forklifts, making them virtually indistinguishable from legitimate e-commerce distribution centers.

These multifaceted theft groups have become a significant concern for retailers of all sizes, attributing lower profits, recruitment challenges, and a deterioration of the in-store experience to rampant crime. Moreover, the proliferation of locked merchandise and unchecked theft has galvanized Americans across political divides in their frustration.

The Intricacies of Organized Crime Targeting Retailers such as Ulta, T.J. Maxx, and Walgreens
Michelle Mack is taken into custody, on Dec. 6, 2023 (Credits: CNBC News)

While the extent of the rise in organized retail crime remains subject to debate, several retailers, including Target, Foot Locker, Walgreens, and Ulta, have acknowledged its growing menace in recent years.

However, few have disclosed the frequency or financial toll of such incidents, prompting skepticism from experts who accuse them of using crime as a scapegoat for operational shortcomings.

The National Retail Federation estimates that retailers incurred $40.5 billion in losses due to external theft, encompassing organized retail crime, in 2022, accounting for approximately 36% of total inventory losses, marginally lower than the previous year.

Even if the financial impact of theft hasn’t significantly impacted some retailers’ profits, concerns persist over its implications for the safety of both employees and customers.

Ulta CEO Dave Kimbell emphasized the human toll of retail crime, stressing its effects on associates, customers, and communities. He warned that if people feel unsafe shopping in certain areas, it could profoundly alter neighborhoods and communities over time.

The Intricacies of Organized Crime Targeting Retailers such as Ulta, T.J. Maxx, and Walgreens
Michelle Mack is taken into custody, on Dec. 6, 2023 (Credits: CNBC News)

In response, government agencies at both local and federal levels have intensified enforcement efforts targeting organized retail crime, while lawmakers propose and enact legislation to bolster penalties for theft offenses.

In the fiscal year 2021, Homeland Security Investigations (HSI) launched 59 cases against organized theft groups, resulting in 55 indictments and 61 arrests, according to the agency.

By the conclusion of the fiscal year 2023, the number of cases had surged to 199, marking a more than threefold increase. Indictments skyrocketed over fivefold to 284, while arrests soared to 386, exceeding six times the tally in 2021.

The California Highway Patrol, overseeing one of the nation’s most active retail crime task forces, reported a 170% surge in arrests for organized theft offenses in 2023 compared to the previous year.

It remains uncertain whether the surge in organized theft offenses reflects an actual increase in criminal activity or if officials intensified enforcement efforts in response to heightened public attention and pressure from the retail industry’s lobbying endeavors, urging them to prioritize this issue.

For this investigation, CNBC embedded with teams from HSI and the California Highway Patrol, witnessing four organized retail crime operations. The findings draw from over a dozen interviews with law enforcement officials, retail executives, and customers, and a variety of records, including court filings, company reports, and property records.


During a scorching Monday morning in July, a team of approximately twelve agents from HSI New Orleans convened behind the U.S. Customs House, gearing up for Operation French Quarter.

The Intricacies of Organized Crime Targeting Retailers such as Ulta, T.J. Maxx, and Walgreens
The stolen cosmetics were found by the police at Michelle Mack’s home (Credits: CNBC News)

Their mission: to infiltrate three Walgreens stores and one CVS outlet in areas witnessing alarmingly high rates of theft, often tallying up to 20 to 30 incidents daily, as relayed by agents.

Despite being federal law enforcement agents typically focused on investigating terrorism, sex trafficking, and criminal enterprises like Joaquin “El Chapo” Guzman’s syndicate, the officers weren’t tasked with apprehending individuals for minor thefts.

Their primary objective was crystal clear: to identify the perpetrators of these thefts and trail them outside the stores to uncover potential connections with larger crime networks.

Addressing the assembled officers, Assistant Special Agent in Charge Scott Robles, who spearheaded the operation, emphasized the importance of targeting the masterminds behind organized retail crime: “The name of the game, guys and girls, is trying to get the bigger and better fish. We’re trying to identify the people who are in charge of this organized crime.”

At the base of these organized theft rings are “boosters” — individuals who enter stores to pilfer items. Robles hoped that tracking these serial thieves, particularly those targeting drugstores, could lead them to uncover broader criminal operations.

“Anyone could be involved,” Robles explained. “It could be the mom with five kids looking for extra money. It could be someone part of a team… They may be getting paid with food, beer, drugs, or cash, or they’re trying to settle a debt.”

Throughout the operation, agents identified at least one instance that unmistakably pointed to organized theft. Surveillance footage captured a man entering a Walgreens store, proceeding to the cosmetics aisle, and discreetly filling a plastic shopping bag with 17 jars of nail polish, valued at approximately $200.

He then strolled half a mile away to the New Orleans Public Library’s main branch, where he purportedly sold the stolen goods to a security guard.

While federal agents briefly interrogated the security guard, the incident remains under investigation.

Apart from this occurrence, the majority of thefts observed during the operation were characterized as low-level and petty, often involving individuals who appeared homeless, mentally unstable, or transient.

One individual absconded with paper towels and sought refuge in a homeless shelter, while a group purloined a case of beer and proceeded to a park to consume it. In another instance, a woman pilfered a case of water, set up a makeshift stall to resell it, and then defecated on the sidewalk.

Operation French Quarter shed light on the workings of the lowest echelon of retail crime operations and underscored the coordination involved even in seemingly minor thefts.

However, these incidents also highlighted the hurdles investigators face in building cases and underscored the prevalence of petty thefts, particularly in urban areas grappling with high rates of homelessness and substance abuse.

Responding to inquiries, a Walgreens spokesperson emphasized the company’s commitment to the safety of patrons, customers, and staff, outlining measures aimed at deterring theft and enhancing the overall customer experience.

They also affirmed the company’s collaboration with law enforcement, elected officials, and community leaders to address and mitigate retail crime.


Crates brimming with untouched jugs of Gain, Tide, and Downy detergent. Boxes overflowing with Gillette razors, Olay moisturizers, and Allegra allergy pills. A heap of glistening silver boots, each adorned with T.J. Maxx tags, ranging in sizes from 8 to 10.

The Intricacies of Organized Crime Targeting Retailers such as Ulta, T.J. Maxx, and Walgreens
A bin filled with sparkly silver boots was discovered. The police suspect an alleged San Jose, California, crime ring stolen from T.J. Maxx. (Credits: Gabrielle Fonrouge)

This array of merchandise merely scratches the surface of what California Highway Patrol stumbled upon during a raid in November, targeting suspected members of an organized retail crime ring in San Jose.

Investigators uncovered nearly 20,000 items valued at over $550,000 spread across five locations linked to the group, according to CHP. The majority of these items, police suspect, were pilfered from T.J. Maxx stores, as well as various drugstores and grocery outlets in and around the Bay Area.

The investigation kicked off in September when TJX Companies, the parent company of T.J. Maxx, alerted CHP’s organized retail crime task force about a criminal operation involved in buying and reselling stolen goods—a classic “fencing” scheme.

Boosters, individuals who steal items from stores, often turn to fences to offload their loot. Fences purchase these goods at a fraction of their value and resell them, yielding profits far beyond typical retail margins, as noted by retail crime investigators.

Convincing law enforcement to prioritize theft investigations at stores can be challenging, as property crimes are often viewed as less urgent compared to violent offenses. To demonstrate the gravity of the situation, TJX investigators conducted surveillance on the alleged crime ring, ultimately enlisting CHP’s assistance.

Sergeant Manny Nevarez, overseeing organized retail crime investigations in the Bay Area, revealed that the group had targeted stores across multiple counties to evade detection.

“They are not catching on that some of the retailers have their own loss prevention personnel,” Nevarez explained. “Typically, if you target one store in San Jose, then the word gets out and then the next store is notified.”

Investigators discovered that members of the group were reselling stolen merchandise from their homes and at the local Capitol Flea Market, a sprawling swap meet on the outskirts of San Jose. They observed suspects receiving stolen goods, transferring them within their network, and exchanging money.

In late November, CHP investigators, in collaboration with TJX, executed search warrants at the five locations linked to the fencing ring in a raid dubbed “Operation Kingsfall.” These locations included several homes and a storage unit.

“Nosotros somos policia,” officers shouted in Spanish outside one of the homes. “Police, search warrant. Open the door with your hands up,” they continued, employing a battering ram to gain entry.

Inside, amidst Christmas decorations, officers found a staggering amount of suspected stolen merchandise, including clothing with tags attached, boxes of Huggies diapers, liquor, and power tools.

Upon completion of the raids, authorities amassed enough suspected stolen merchandise to fill three 20-foot-long U-Haul trucks. The Santa Clara County District Attorney’s Office confirmed charges against nine defendants in connection with the alleged crime ring.

This law enforcement operation showcased the expansive reach of fencing rings in the U.S. and the role flea markets play in the sale of stolen goods. Capitol Flea Market did not respond to requests for comment.

Lt. Michael Ball, who supervised the operation, emphasized the public’s outcry against such crimes, stating, “There are certain crimes that come up where the public reaches a point where they’re like, ‘We have had enough of this,’ right? And this is one of those that’s reached that level.”

In response, a TJX spokesperson expressed gratitude for CHP’s efforts and reiterated the company’s commitment to combatting organized retail crime. TJX stated it would not resell the recovered merchandise but would consider donating suitable items to charities in the area.


When Donna Washburn set out to find the perfect Christmas gift for her daughter last December, she had her sights set on splurging a bit, opting for a bottle of Nars foundation. Yet, to her dismay, she couldn’t locate it in stock at any nearby stores.

The Intricacies of Organized Crime Targeting Retailers such as Ulta, T.J. Maxx, and Walgreens
Donna Washburn had bought a beauty product from Michelle Mack’s Amazon store that police suspect had been stolen (Credits: CNBC News)

Like many consumers, Washburn turned to Google in her quest, stumbling upon the product listed on Amazon at a tempting price of around $38, nearly 30% below its usual retail cost of $52.

“I thought, ‘It’s Amazon, it’ll arrive quickly.’ It was early December, and I didn’t want to risk it not arriving in time for Christmas,” Washburn recounted to CNBC, recalling that she was promised delivery by December 11.

Unbeknownst to Washburn, police allege that the very bottle of foundation she ordered had likely been pilfered by a team of boosters allegedly in the employ of Michelle Mack — the suspected mastermind behind an illicit retail crime operation centered around her San Diego estate.

However, Washburn’s Christmas gift never made it to her doorstep. Mack’s arrest preempted the package’s dispatch, as it was among the numerous parcels discovered by investigators at Mack’s residence.

“I do pay attention, but not to that extent, you know?” admitted Washburn, a 63-year-old clinical education associate from St. Augustine, Florida. “I shop on Amazon, assuming it’s trustworthy. But now that we know better… we’ll think twice.”

Washburn had purchased the foundation from an Amazon storefront named Online Makeup Store, established by Mack in 2012. CNBC had viewed the store before it was removed in late 2023.

At first glance, Mack’s storefront appeared indistinguishable from countless others on Amazon’s marketplace. With a commendable 4.5-star rating based on over 100 reviews, it showcased cosmetics from renowned brands like Mac, Tarte, and Charlotte Tilbury, commonly found in local beauty boutiques.

Yet, there was one glaring anomaly: the prices. Many of the products listed on Mack’s store were available at a fraction of their typical retail prices, including an Estee Lauder foundation priced at $25 (typically $52) and Too Faced mascara discounted to $17 from its usual $29.

Despite these discrepancies, Mack’s store thrived, raking in millions since its inception in 2012. Before its closure, Mack had amassed nearly $8 million in cosmetics sales, with $1.89 million generated in 2022 alone, according to Amazon sales records provided to investigators.

Police suspect that Mack could offer such steep discounts due to her team of boosters, who allegedly swiped products in hundreds of incidents over more than a decade. Some thefts yielded around $2,000 in merchandise, while others amassed up to $50,000, prosecutors revealed.

Mack’s operation appeared to be flourishing ahead of the holiday season until law enforcement intervened. In a meticulously planned raid on her expansive mansion one December morning, a convoy of CHP and HSI agents executed a search warrant.

Clad in a baby pink pajama set and fuzzy mule slippers, Mack was handcuffed and escorted into a police car as her teenage daughters looked on from the driveway.

Inside the garage, investigators stumbled upon what they dubbed a “mini-store” — shelves brimming with beauty products, sunglasses, and designer bags meticulously organized in bins. Additionally, they unearthed hundreds of yellow envelopes, destined for unsuspecting customers like Washburn, bearing the return address of “Online Makeup Store.”

In total, police recovered nearly 10,000 items valued at over $387,000, according to CHP.

In February, California Attorney General Rob Bonta made a significant move by filing a total of 140 felony charges against Michelle Mack, her husband Kenneth Mack, and seven other alleged members of their crew.

These charges included conspiracy to commit organized retail theft, grand theft, and receipt of stolen property. All defendants have pleaded not guilty. Despite multiple attempts to reach out for comment, no response from any of them.

“This is a multimillion-dollar criminal scheme. It was complex. It was orchestrated,” stated Bonta when announcing the charges. “We are not talking about garden-variety shoplifting.”

Court records associated with the case offer a rare insight into the inner workings of an alleged organized retail crime ring. They reveal text messages exchanged between the suspects, shedding light on the operation.

On January 7, 2023, Kimora Lee Gooding messaged Michelle Mack, stating, “I’m not stealing regularly, I’m going to start filling up my bag quick. So I want to know stuff I can grab in bulks too.”

According to prosecutors, between January 30 and February 16, 2023, Gooding conducted at least 10 separate thefts at Ulta stores across California, each time taking goods valued at over $950.

Following Gooding’s string of thefts, Mack allegedly sent her a screenshot of “Online Makeup Store” on February 21, providing an address for shipping stolen products. This was the same business address listed on Mack’s Amazon page before its closure, traced back to a post office box near her home.

A couple of days later, Mack messaged her husband, Kenneth Mack, mentioning success even without a particular cosmetics brand and urging to start shipping orders.

By July 8, when the stolen merchandise supply seemed to dwindle, Mack reached out to Alina Franco, another charged individual, inquiring about acquiring more products for sale.

Prosecutors claim that in addition to Ulta and Sephora, the theft organization targeted a variety of other retailers, including Bloomingdale’s, Prada, Bath & Body Works, Victoria’s Secret, Luxottica’s Sunglass Hut, and LensCrafters.

Sephora and Bath & Body Works declined to discuss the case, while Macy’s, Prada, Sunglass Hut, and LensCrafters did not respond to requests for comment.

However, a spokesperson for Victoria’s Secret stated that the company cooperated with the investigation, emphasizing its commitment to addressing theft and prioritizing the safety of associates and customers.

The Intricacies of Organized Crime Targeting Retailers such as Ulta, T.J. Maxx, and Walgreens
California Attorney General Rob Bonta whose been discussing Michelle Mack’s case in an interview held on Feb. 16, 2024. (Credits: CNBC News)

The proliferation of organized theft groups is a longstanding issue, but industry leaders and law enforcement officials argue that the rise of online marketplaces and e-commerce has exacerbated the problem.

Ulta Beauty CEO Dave Kimbell emphasized the ease with which stolen goods can now be distributed through online platforms, highlighting the need for online marketplaces to take proactive measures in preventing the sale of stolen goods.

Responding to these concerns, an Amazon spokesperson stated the company’s “zero tolerance for the sale of stolen goods” and emphasized its investments in fraud prevention. The spokesperson emphasized Amazon’s collaboration with law enforcement and other stakeholders to combat retail crime.

Despite recent legislative efforts such as the Inform Consumers Act, designed to curb the sale of stolen or counterfeit products online, challenges remain in effectively addressing organized retail crime.

While the law aims to enhance verification processes for sellers on online platforms, its effectiveness in deterring illicit activities like those allegedly conducted by Michelle Mack’s crew remains to be seen.

Sajda Parveen
Sajda Parveen
Sajda Praveen is a market expert. She has over 6 years of experience in the field and she shares her expertise with readers. You can reach out to her at [email protected]
Notify of
Inline Feedbacks
View all comments
Would love your thoughts, please comment.x