Why is Walmart pushing for RFID tagging from their main suppliers?

January 26, 2005

This recent article in eweek is an interesting find by scaredpoet: Wal-Mart Stung in $1.5 Million Bar-Code Scam:

It appears we now know why Wal-Mart is so gung-ho about replacing the barcode with new RFID technology: bar code fraud.

[...] someone discovered that if you buy a low-priced item, scan the UPC symbol and then print out multiple copies, pasting them over any high-dollar items in the store, those big-ticket ticket items will of course ring up the low-value price of the spoofed item.

I actually thought cashiers would be brighter than this, but if the case is genuine, it's a compelling argument for RFID tagging items (not to say that swindlers couldn't just lift RFID tags off one product and stick them on to another...)

Posted by andersja


Interestingly the "too simple to be re-programmed" type of RFID tag being tested by Tesco on DVD packaging or by Marks & Spencer on men's suits and jackets, offers some level of protection against false price label printing, but, obviously, not against the traditional "old fashioned" label switching.

However the more sophisticated , re-programmable EPC compliant RFID tags simply offer an undetectable way of price switching and warehouse pilferage, remotely, by radio.

All a thief has to do is to crack or sniff the short unencrypted password programmed into the chips, which will in many cases be used for whole batches, product types or complete suppliers ranges of goods, rather than on an individual per tag basis.

Until proper cryptographic handshake protocols are implementd (as already exist in the more expensive re-usable RFID tags and contactless Smart Cards) this "price switching" theft will not be reduced by RFID tags.

Posted by: Watching Them, Watching Us at January 27, 2005 05:40 AM

Can we say, “Paranoia” ….LOL. Where do you get your information? The reason why Wal-mart is pushing the RFID is for inventory purposes. By going RFID you can get real time inventory. This will save hundreds of man hours. It’s as easy as that, nothing sneaky. I would also like to add that the RFID will be embedded into the barcodes label.

Posted by: John at February 16, 2005 07:42 PM
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