Putting crime on the Map

Aug 1, 1999 12:00 PM

Predicting the likelihood of crime in specific neighborhoods helps businesses choose where to locate, and guides security directors in allocating resources effectively.

Picture a neighborhood with freshly painted houses and well manicured lawns. Down the street there's a shiny new mall. The neighborhood doesn't look like a high-crime area. But only a short walk away, the houses are abandoned and boarded up and the only storefront is a check-cashing business with its windows and doors protected by iron bars.

You would want the complete picture if you were a home buyer or a business owner - or a director of loss prevention. Al Martinez holds such a position for Bath and Body Works. In the past three years he has seen his company expand from 450 stores to more than 1,200 in malls and storefronts across the country.

"We're growing at such a rapid rate that we really need to get a handle on store locations and prepare from a physical security and loss prevention perspective," he says.

For years Martinez and others had to beg for outdated police reports or listen to anecdotes to learn the risk of locating in a particular area. Then CAP Index Inc., a small, King of Prussia, Pa.-based company, came along and gave risk assessment a statistical face.

The company's executives claim they can predict the likelihood of crime in a particular area by using 21 demographic variables - they won't reveal exactly which ones - culled from updated census tracts.

"We're looking at information such as median household income, the value of the home, educational levels, whether or not people own their homes, density of a neighborhood, whether you have 20 or 80 houses, the size of families," says marketing director Daniel H. Kropp. "We're comparing that information against crime statistics."

The variables are weighted and analyzed using a specific formula, and the results are displayed on color-coded maps. An Excel spreadsheet program breaks down the likelihood of murders, robberies, burglary, aggravated assault, larceny and auto theft and other crimes in the area and compares the statistics to state and national averages.

"A relationship exists between a community's level of social disorder and its risk of crime," explains company CEO Robert M. Figlio, Ph.D. "Our proprietary computer model can tell a retailer their odds of being robbed. Our data allows merchants to decide which security precautions they should take or whether they should avoid the site altogether."

According to Kropp, CAP Index is based on the common-sense axiom that where there are worse social conditions, there are higher risks of crime and where there are better social conditions, the risks of crime are smaller.

"While it seems like common sense, we have put it to a mathematical test," he says. They have also made it easier for a company to get reliable data than, say, from the local police department.

"I'm still waiting for police statistics that I first requested in 1995 for two of our Colorado Springs hotels. I don't think they're going to give them to me," remarks Jim Stover, director of corporate security for 121 Bristol Hotels and Resorts.

The scientific approach to crime prediction has found an eager audience in a corporate America that regularly pays up to $343 for site reports. The company's client roster includes 14 of the top 20 Fortune 100 companies. Among the household names are Target, Dayton Hudson, Home Depot, First Union Bank, Keystone Financial, Lowe's, NationsBank, Banc One and a host of fast food stores and petroleum companies.

Their success has enticed Pinkerton and alarm distributors Mosler and ADT to sign on to distribute CAP Index products to their customers. And CAP Index is also angling to provide security information to the general public. It recently bought CrimeCheck, a small Houston-based firm that sells crime reports based on FBI data over the Internet through sites such as Microsoft's HomeAdvisor.

Company founder Figlio spent the 1970s and '80s teaching criminology at the Wharton School of the University of Pennsylvania. While there, he worked with Steven K. Aurand, a statistical computer specialist who is now company president. After leaving academia, the two continued to collaborate on models and algorithms that examined neighborhood characteristics to predict crime. This work led to CAP Index's Crimecast system, a product that they say objectively predicts the danger of particular crimes in a particular area.

The two founded CAP Index - named for their model that assesses Crimes Against Persons and Property - in 1988 and began operating out of their homes.

Crimecast scores range from 1 to 2,000, with 100 representing average risk. These data are updated on a regular basis, ensuring current risk information for any geographic area or neighborhood in the United States.

"I work very closely with the real estate department in the approval process for sites," says Claude Verville, vice president of loss prevention for Lowe's, the do-it-yourself giant. "Prior to approving a site I get the location from the real estate department and forward it to CAP Index for scores. Those scores go back to the real estate department for review."

And their reports give a client a feel not just for her particular street, but for the surrounding area. While you may be looking out your window at a nice neighborhood, one block over conditions can change drastically. CAP Index takes an address and then looks at the conditions within a one-mile radius.

"We measure the crime potential for that one-mile radius and then we go out three miles and measure the crime for that three-mile radius as well," says Kropp. "We combine them into a weighted average. Essentially we're telling you your crime risk isn't just sitting outside your door."

Verville noted that Lowe's was considering locating a store in north central Houston. The area was close to a rough area of town filled with crack houses and stores with barred windows, but their prime competitor, Home Depot, already had one of its most profitable stores there.

Even if companies realize an area is high-risk, they may want to know what level of security they need for a particular store. Others may decide not to locate in a specific neighborhood.

"We wanted to have what we call a high-risk program in place for new stores, but we're also using it for current stores as well," says Bath and Body Works' Martinez. "So we use the data to give us the tools to plan security for the new stores in terms of what systems we need to have in place prior to store opening. And to upgrade what we need for the current stores."

Kropp denies that CAP Index's reports could lead to redlining, the once-common practice in the banking industry of identifying particular - usually minority - urban neighborhoods and avoiding them. Laws prohibit the practice today. It is illegal for a real estate agent to tell you that a house is in a "bad" neighborhood.

"We don't look at race - because this is a business tool," asserts Kropp. "Race cannot be used, or should not be used, in business decisions."

Identifying a high crime rate may prevent businesses from locating to the area. "Anything over four times the national average is where we really get concerned," says Martinez. "For the new stores, if the scores are more than five times the national average, more than likely that deal is going to be killed based on that average. It just doesn't make good business sense for us to operate a store where we have to worry about property losses as well as the safety of our people."

Verville, on the other hand, says Lowe's property selectors are not discouraged from a site just because it receives a high score. "What we do is issue every store - all 525 of them - a security classification," he says. "The classification determines how we allocate our security resources to that store."

Stover sees another benefit to CAP.

"It's helped me sell security measures to upper management," he says. "They understand the process. They understand how the numbers are generated based on various census statistics and crime data."

Pizza Hut executives have used the data produced by CAP Index to fend off charges in the media of arbitrariness in selecting what neighborhoods they will serve.

The reports and maps also can help companies defend themselves in court against an injured plaintiff's charges that they should have foreseen a crime and taken measures to prevent it.

The data may also lead to revelations about particular areas.

"I think 99 percent of the people in the country would agree that if social conditions are poor then the crime rate is going to be high. But what we've been able to uncover is which factors in a particular social condition contribute to which crimes," says Kropp.

While social conditions tend to come together as a package, they occur at different rates. In one lower middle class working neighborhood you might have low educational levels, but residents own their homes and the family is intact. Children are living at home and getting a better education than their parents.

"All the 21 (demographic) factors play a role and no single one is the most telling," he remarks.

Across the country the bright red, yellow and green maps have a valued place in corporate security offices. These products of the social cartographers at CAP Index are allowing companies to plot a safer course through the uncharted streets of urban America.

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© 2012 Penton Media Inc.

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