It’s about as routine a situation as any you’ll find in trucking. And that’s what makes it so dangerous from a freight security perspective. A tractor arrives at the loading dock of ABC Trucking’s warehouse. The driver gets out and tells the dock supervisor, “Hey, I’m from XYZ Trucking and I’m due to pick up a load of widgets heading west to Utah. Traffic turned out to be a breeze today and I got here a few hours early. Can I hook up and go?”
“No sweat,” the supervisor says, and that’s the truth. The load is ready and it clearly says on the freight bill XYZ Trucking is due to handle the pickup. Documents are signed, tractor and trailer are hitched up, and off the load goes to its final destination.
Until, two hours later, a driver from the real XYZ Trucking shows up, with paperwork in hand, ready to pick up that load of widgets headed to Utah.
That’s just one of the new “strategic methods” cargo thieves are using to steal freight, says Sam Rizzitelli, national director for transportation at Travelers Inland Marine division.
In the scenario above, known as a fictitious pickup, everyone involved has a legitimate intent to haul the freight until an imposter slides into the picture, temporarily posing as the duly appointed carrier. “Sometimes they’ve got paperwork and sometimes they just spin a yarn about being early,” Rizzitelli explains. “Then they take off and no one realizes there’s a problem until much later.”
There’s also identity theft, whereby the thieves use the name of a real trucking company to bid on loads. “In this case, the freight customer is dealing with the bad guys right from the start,” he says. “That’s a very important distinction from the fictitious pickup, where a legitimate carrier is engaged in the transport process. That difference is key in terms of downstream impact, in how they affect the ways you need to guard against such crimes.”
Obtaining and exploiting shipment and carrier information in a more detailed way is critical to making those types of crimes work, stresses Scott Cornell, director of the Specialty Investigations Group within the Inland Marine division at Travelers.
“The majority is still what we call straight theft where thieves just go out and steal the cargo and everyone knows it’s been stolen,” he explains. “But more strategic methods are the fastest-growing categories of cargo thefts we see today.”
Cornell says that in some cases thieves will set up a trucking company and actually haul goods legitimately, then steal particular shipments and report them as stolen.
“This is the most complicated type of cargo theft; it’s extremely creative,” adds Rizzitelli. “The thieves are not stealing a carrier’s ID here. They are engaged as a legitimate trucking company from the start, a wolf in sheep’s clothing so to speak. They will lull the shipper by staying in constant contact with a load, create ‘street drama’ when staging a theft, even go so far as to file a police report.”
Cornell notes that this allows the thieves to play the victim in several different ways. “They can haul legitimate loads on a daily basis while stealing some on the side, then claim they’ve been victimized by identity theft,” he explains. “This is why engaging in rigorous information protocols, such as verifying DOT numbers, addresses, phone numbers, freight bills, etc., and cross-referencing that data is so critical now for carriers and shippers alike.”
Yet Walt Fountain, safety and enterprise security director for TL carrier Schneider National, stresses that the battle against cargo thieves is constantly evolving, and methods to safeguard freight and the information surrounding it must constantly evolve as well.
“First of all, cargo theft prevention takes discipline on the part of all involved—shippers, operational personnel, driver personnel, consignee, etc.,” he explains. “Second, the thieves are continuing to evolve and seek out weaknesses within supply chains that they can exploit. Nothing seems to stay fixed forever, as thieves keep actively planning and building their business plans to steal our freight.”
As with most human endeavors, Fountain adds, not everyone in the trucking industry is paying attention to the threat. “Often, the we’ve-always-done-it-this way or nothing-bad-happened-the-last-time-I-cut-corners syndrome gets in the way of solid and prudent risk mitigation,” he says. “And although many are trying to match technology investment with the load theft risk, it is easier for fixed loop, dedicated supply chain lanes and much more difficult for traditional over the-road operations with open networks and variable customer lanes.”
While there is no single technological silver bullet carriers can use to ward off cargo thieves, Fountain believes truly effective anti-theft efforts require a layering of both technical and non-technical solutions.
“We use the analogy of several slices of Swiss cheese layered upon one another, with each slice representing a single anti-theft action,” he explains. “The goal is to ensure we cover the holes in one slice with another slice, and if the holes align, that means there is a vulnerability the thieves can identify and exploit.”
Frank Scafidi, director of public affairs for the National Insurance Crime Bureau, notes that fleets are taking more effective measures to protect not only their cargo but also their equipment. These efforts are designed to help make motor carriers more secure as various technologies become more adaptable and integral to trucking operations as well as more affordable to deploy.
“There are applications and devices available and in service today that will babysit cargo from the moment it is accepted by a shipper until it reaches its destination,” he says. “Some applications allow for real-time video monitoring, and others allow for tracking an entire shipment or selected items within a shipment. In the event of a theft or hijacking, law enforcement has a much greater chance of recovering the load and arresting suspects.”
Dale Smith, staff product manager for Omnitracs, provides one example via the firm’s Trailer Track TT210 device.
“The TT210 arms fleets with notifications on cargo connects and disconnects, trailer drops and door openings at unauthorized locations, and provides details on trailer inventory by landmark,” he explains. “Additionally, when integrated with Omnitracs’ Driver Workflow, the TT210 software automatically validates authorized trailer connections and alerts fleet managers when an unauthorized connection is made.”
Using geofencing technologies, Smith says the TT210 can send automatic, near real-time notifications whenever a trailer moves in or out of the preapproved coordinates, allowing fleets to proactively react to possible cargo theft. “If a driver has authorization to stay the night in a hotel room, the carrier can create a geofence containment field around the hotel parking lot that will send an alert if anything happens to the truck while the driver is sleeping inside the hotel,” he explains.
Don Hsieh, director of commercial and industrial marketing for Tyco Integrated Security, explains that better information security overall is needed to thwart the efforts to both pilfer critical cargo movement data as well as spot the fake faces thieves deploy when posing as legitimate carriers.
He adds that tagging certain job titles to specific zones such as dispatch, operations, warehouses and loading docks is another step towards improving the physical security of trucking operations, which in turn can aid in anti-cargo theft efforts as well.
“Most cargo thefts don’t just happen anymore. Thieves are now often targeting specific loads based on specific information they steal or have stolen for them,” Hsieh explains. “That’s why both a physical and technological component to anti-cargo theft efforts is needed now.”
Schneider’s Fountain, however, stresses that for technology to be a successful aid in thwarting cargo theft, it requires interaction with what he calls a thinking person. “For example, an overt trailer tracking device can be useful for recognizing a theft and engaging law enforcement rapidly for recovery, but if it is not being actively monitored, it will be somewhat useless,” he says. “The same goes for a covert tracking device embedded in a load. If eight hours elapse before anyone realizes the load has been taken, the cargo is likely transferred and the device discovered and discarded.”
The other challenge with embedded technology is it often requires shipper and consignee involvement due to the sealing of the load prior to the involvement of the trucking company. “Can monitoring technology be useful? Absolutely, but it needs to be engineered for the load profile and risk acceptance profiles of the shipper, transporter, and consignee,” Fountain emphasizes.
Tyco’s Hsieh adds that sometimes it’s wise to think simple when it comes to the ways technology can be deployed to discourage cargo theft. “About 70% to 75% of cargo thefts still occur at truckstops and other open areas, usually when the truck is left at idle while the driver is away,” he says. “That’s really still the way the majority of cargo is stolen. One way to make that harder is to use asset-control technology such as a pin code that needs to be entered before gears can be shifted.”
It’s also important to recognize that thieves are increasingly going after softer targets, says Hsieh. For four years in a row now, food and beverages have been the most stolen type of cargo, eclipsing even electronics.
“Million-dollar loads of flat-screen TVs are being protected by a variety of technologies and procedures, but the $100,000 loads of soda are typically not,” he emphasizes. “You’ve also got to deal with multiple layers as no one solution can prevent cargo theft all on its own. You’ve got to make cargo harder and harder to steal, making it difficult for thieves to execute their plans.”
“Thieves are just taking advantage of the vulnerabilities we present,” adds Schneider’s Fountain. “For example, if our industry continues to solicit bids for loads on open websites and then broker loads with little or no vetting of the potential carrier, then thieves will continue to determine ways to misdirect legitimate freight operations to their advantage.”
Some of this new misdirection on the part of cargo thieves can be quite complex, says Fountain. “Use the word sophisticated if you like,” he notes. But should the trucking industry really be surprised when a thief takes advantage of a situation where some in the industry routinely contract with an unknown or unverified company to move loads in a tight capacity market?
“I think not,” he continues. “We need to keep improving our vetting, validation and auditing of our supplier and carrier relationships. Recognizing our own vulnerabilities and then committing to mitigating their risk is our approach.”
One of the real challenges in combating cargo theft is shrinking budgets and resources, he says. “Let’s face it, cargo theft doesn’t compete well for resources versus crimes against persons,” Fountain notes. “Even if the cargo thieves may be using their profits to finance other criminal behavior, the nexus is difficult to prove.”
From that perspective, he believes trucking’s best alternative to dwindling resources is a more robust sharing of information with law enforcement and fellow carriers, shippers, and consignees.
“Illuminating the threat tactics provides us a better chance to combat the thieves,” Fountain explains. “A company shouldn’t have to personally suffer every hit in order to understand the threat environment. There should not be industry competition in the areas of security and safety. Industry improvement in these areas is in everyone’s best interests.”
Cargo theft’s gumshoes
They don’t carry badges, handcuffs, or firearms. They don’t drive supercharged squad cars or wear matching monochrome suits and sunglasses. Yet they are some of the most potent weapons facing off against cargo thieves these days: the private eyes staffing the Specialty Investigations Group (SIG) within the Inland Marine division at Travelers Insurance.
Organized nine years ago, SIG’s mission is twofold: investigate cargo thefts and guide clients through the process of adopting policies and procedures to harden their operations against such criminal activity. When Scott Cornell, SIG director, got the group off the ground, it was just him and one other staffer. Now he commands a force of 10 agents scattered across the U.S., agents that for the most part are former law enforcement personnel who specialized in working the cargo theft beat.
“We’ve got agents in New Jersey, Dallas, Atlanta, and Los Angeles—all the hot spots where most cargo thefts occur,” he explains. “You’d also be surprised at how difficult cargo theft investigations are, how far stolen goods will travel, and by how much logistical knowledge our investigators need. Furthermore, we’re on call 24/7, which means a lot of nights and weekends are spent working these crimes.”
They have neither the firepower nor the arrest capabilities of law enforcement units dedicated to combating cargo theft, such as the Los Angeles County Sheriff’s Dept.’s Cargo Criminal Apprehension Team (known as the “Cargo CATs” for short); however, Cornell’s team possesses one distinct advantage: national investigative scope.
“We’re not limited by jurisdictions and state lines,” he says. “We follow the trail wherever it might lead.”
To do that successfully, one of SIG’s agents is a full-time desk jockey, taking information that is called or emailed from the group’s field agents, then working the Internet and other sources to try and connect the dots.
All of Cornell’s agents are well-schooled in the methods of cargo thieves, i.e., the places they like to hide and sell stolen goods and the ways they like to move these goods across the country. So, the field agents and desk jockey are always working in concert to try and close the circle on the post-theft portion of these crimes.
“We’re also doing post-theft analysis of each crime our clients report,” Cornell explains. “We take the opportunity to review their security procedures, looking for the gaps that allowed the theft to occur.” He adds that all of these investigative services are free to Travelers clients. In the end, improved security and the recovery of stolen goods significantly reduces claims and saves Travelers a lot of money (and headache) as well.
Tracking the criminals and the stolen goods is always a little bit tricky. Any and all information gleaned by SIG’s agents gets turned over to the proper law enforcement authorities, but they really never fully wash their hands of such cases.
Inevitably, cases will link up as cargo thieves use the same illicit transportation networks and hiding spots to move stolen cargo. “That’s why you’ve got to have patience and a willingness to keep cold cases alive in the back of your head, so to speak,” Cornell points out. “We’ve found on more than one occasion solving one crime gives us pieces of information to solve another.”
Where are the hot spots?
When it comes to cargo theft in the U.S., certain areas of the country—as well as certain types of goods—attract the sticky fingers of criminals.
“Generally speaking, the Southeast, South and West have seen more incidents of cargo theft, though we have [cargo theft] cases all around the nation,” says Frank Scafidi, director of public affairs for the National Insurance Crime Bureau.
“Why thieves target certain areas is more a function of perhaps less traveled areas or more lucrative loads traversing certain corridors or routes in the nation,” he explains. “But warehouses are targets also and in those instances, it is definitely the product that defines the crime. Among the most popular loads for theft are electronics such as cell phones and computers, clothing, food and pharmaceuticals.”
According to research conducted by FreightWatch, there were 951 cargo thefts throughout the U.S. in 2013, which is the same as in 2012, tying for the highest level of theft incidents on record. Although the number remained steady, the threat of cargo theft continues to grow in the U.S. due to increased organization and innovation on the part of cargo thieves, the firm notes.
Overall, the U.S. is ranked as having a high threat level for cargo thefts on the FreightWatch five-point risk scale, which ascends from low to moderate, elevated, high and finally to severe.
The following are some of the more notable trends in cargo theft identified by the firm:
- Full TL pharmaceutical thefts jumped 50% in 2013.
- California full TL pharmaceutical thefts spiked from 0 to 5; Illinois tripled its theft volume of pharmaceuticals.
- Driver thefts increased by 44%.
- Food/drinks thefts rose 34.42%; thefts of several food/beverage subtypes more than doubled.
- California logged 92% of all recorded thefts of nuts.
- Thefts targeting the electronics sector surged 35.9% in California.
- New Jersey experienced a 158% jump in food/drinks thefts, with an unusual concentration on seafood.
- Southwest Dallas became a new hijacking hot spot.
“Hot spots are numerous, but the most notorious can be identified by the confluence of the major interstates: Dallas, TX; West Memphis, TN; Fontana, CA; and Atlanta, GA,” adds Walt Fountain, safety and enterprise security director for TL carrier Schneider National.
“Thieves seem to be finding and exploiting the volume and ease associated with consumable products—beverages, foodstuffs, detergent, etc.,” Fountain points out. “It is very hard to distinguish stolen goods from legitimate goods in these categories. Often, the products are consumed by the time law enforcement gets a lead on their whereabouts—and it is hard to prosecute a thief when the evidence was eaten last week.”