Committee backs bill requiring online marketplaces to report suspected sales of stolen goods

The House Business Affairs and Labor Committee approved Senate Bill 70, a measure aimed at reducing organized retail crime (ORC) by requiring online marketplaces to establish policies to detect and report suspected sales of stolen goods, by a 12-1 vote. Sponsors said the bill will standardize cooperation between law enforcement, retailers and online platforms to disrupt fencing of stolen merchandise.

"Organized retail crime involves the coordinated and increasingly violent theft of large quantities of merchandise from retailers," Representative Amagast, a bill sponsor, told the committee. He said criminal fencing increasingly uses online marketplaces to resell stolen goods.

Retail and law-enforcement supporters described the bill as a consumer-protection and public-safety measure. "We find the products that have been stolen from our stores, we find them on marketplaces," said Chris House, president of the Colorado Retail Council. Cassie Schofield, organized retail crime manager for The Home Depot, told the committee that in fiscal year 2024 Home Depot partnered with law enforcement to close more than 140 ORC cases that involved online fencing, a figure she said represented a 30% increase from 2023.

Opponents warned the bill could impose burdens on legitimate small sellers and marketplaces. "Forced policing by marketplaces of sellers without probable cause... would be like deputizing marketplace owners and their designees," Kristen Hartman, who identified herself as a high-volume online seller, told the committee and urged lawmakers to include online sellers in stakeholder discussions.

Jeff Reester of the Department of Law said the bill is narrow and civil in nature and creates a standardized process for law enforcement to request information from platforms. "This is a civil law, not a criminal," Reester said, adding the measure is intended to create a predictable mechanism for information-sharing so law enforcement can act efficiently.

After witness testimony and discussion, Representative Amagast moved the bill to the Committee of the Whole with a favorable recommendation; Representative Linstead seconded. The committee approved the measure 12-1; Representative Sucla cast the lone no vote. The bill follows prior 2022 legislation, the Informed Consumers Act (House Bill 1099), which established seller verification and disclosure requirements for some third-party sellers. Committee members and witnesses said SB70 is intended to build on that framework by focusing on detection and reporting of suspected fencing and improving information-sharing with law enforcement.

Next step: the bill will be considered by the Committee of the Whole.