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Couple Accused Of Running Fencing Operation That Sold Stolen Baby Formula

DENVER (CBS4) - Two people arrested in a baby formula fencing operation have been accused of taking stolen merchandise and selling some of it online.

"Over the course of a few months our stores lost roughly between $60,000 and
$100,000 worth of product," said Safeway spokeswoman Kris Staaf.

Police arrested Donald Dowling, 39, and Danielle Smith, 33, after executing a search warrant related to a fencing operation on a home located in the 6700 block of West 70th Avenue in Arvada.

"They had a ring going where it was coming out of the store as a theft, then going to a fence who was buying it for a lower rate and then selling it online at a lower rate for the consumer," said Denver Police spokesman Sonny Jackson.

baby formula thefts Danielle Smith and Donald Dowling
Danielle Smith and Donald Dowling (credit: Denver Police)

The investigation started with the Albertsons/Safeway Organized Retail Crime Investigators before it was turned over to Denver police.

The stores provided investigators with information on a group of pattern shoplifters that were stealing baby formula from Safeway stores in Denver and selling the items to a couple in Arvada.

According to court documents, Safeway's team went with a confidential informant to Dowling's home in Arvada and sold him $1,000 worth of marked baby formula for $400. The same team then purchased the items from an online site.

"This is a safety issue if in fact it has been stolen, you don't know what temperature this product has been stored at, you don't know if it's been tampered with," said Staaf.

Baby formula isn't the only thing disappearing from store shelves; other costly products have also hit the black market, including laundry detergent, razor blades, hair and high end skin care products.

"Organized retail crime can happen to any retailer any day, any time," said Staaf.

On the Koah's Kollections storefront listed on Amazon's website mostly baby formula is offered along with some everyday household products. The prices are good, but investigators say Dowling and Smith are behind the online retail site and are linked to stolen items.

In some cases investigators found baby formula being sold for half the retail price.

Police believe there may be several other players involved in the fencing ring that haven't been caught yet.

While executing the search warrant officers recovered evidence related to the fencing operation and found a makeshift hash oil manufacturing lab on the back porch of the home.

Dowling and Smith face charges of theft by receiving. Dowling has been charged with an additional count of manufacturing marijuana concentrate.

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