Report shows cargo thefts down

By: | at 11:10 AM | Channel(s): Logistics  

But thieves are getting more sophisticated

At 30,000 feet, the cargo theft statistics for 2013 look pretty good. The reported number of cargo thefts decreased in 2013 by nine percent from 1,197 incidents reported in 2012 to 1,090 incidents in 2013, according to a report recently released by CargoNet. The total value of reported losses, at $99.3 million, was $670,000 less than in 2012 and $30 million less than in 2011.

But a deeper dive into the numbers show some disturbing trends. The number of fictitious pickups increased by 44 percent over 2012, showing a greater level of sophistication among cargo thieves. The number of thefts from secure facilities increased by 66 percent over 2012, demonstrating greater daring and perhaps skill by the wrongdoers.

Cargo theft incidents continue to be concentrated in eight states: California, Texas, Georgia, Florida, Illinois, New Jersey, Michigan, and Tennessee. California, while seeing a dramatic drop of 20 percent in the number of incidents still suffered the greatest number of cargo thefts in 2013. But the number of incidents in Georgia increased by 32 percent bringing that state to a third-place tie with Florida, which saw a 17 percent decrease.

By bringing these facts to light, CargoNet hopes to help shippers, carriers, and other service providers understand their cargo theft vulnerabilities so that they can take appropriate action. (See box on page 12)

“The overall picture year over year shows consistency,” said Sal Marino, vice president for business development and logistics services at CargoNet, “but I do believe we are capturing only a fraction of the thefts that are occurring in in the United States. The FBI says this is a $15 billion to $20 billion problem. I’m not so sure that is the case but at end of the day it is a multi-billion dollar problem. The report illustrates that not only is there a cargo theft issue in the supply chain but that there is consistency. Thefts are occurring in specific areas and if you look at the top states the one common element is that there is a port there. That is where the freight flow and that is where the cargo theft occurs.”

The issue of fictitious pickups has been on CargoNet’s radar screen for the last few years as a growing problem. The majority, 62 percent, of cargo theft is still done the old-fashioned way, when cargo criminals steal a tractor and trailer or just a trailer for the cargo inside. (Container thefts, at four percent, are much less frequent.) But cargo only thefts, consisting of pilferages and fictitious pickups, now constitute 30 percent of all cargo theft incidents. “As predicted, CargoNet recorded an increase in fictitious pickups from 2012,” said the report. “However, the 44 percent increase was much more dramatic than expected. This trend will only continue to increase as long as cargo thieves view fictitious pickups as safer than other means of cargo theft.”

“The typical cargo theft occurs when a driver stops in in a rest area and when he comes out the truck is gone,” said Marino. “With fictitious pickups cargo thieves utilize false documents such as bills of lading or fake insurance certificates. They tend to take on the names of motor carriers that are in existence and legitimate and use their profile as a cape to penetrate a shipper.”

The scam may also include developing phony websites and other devices to convince shippers and third parties that the cargo pickup is legitimate, even if they perform due diligence. “They buy throw-away untraceable cell phones and work in coffee shops so that their internet activities can’t be tracked,” said Marino. “They will look at websites and other data sets to make sure the data presented on the false documents match up. They show up with the appropriate paperwork, security lets them through, they load the trailer, and drive it away.”

Why are crooks more attracted to this type of crime? “It’s non-obtrusive,” said Marino. “It’s easier than breaking in and hot wiring a truck or pilfering when someone isn’t looking. The thieves also have more leeway. If they pickup a load on Friday that’s not due to be delivered until the next Thursday the shipper may not know about the incident until Thursday. That gives the thieves a lot of leeway and makes recovery of the stolen goods more difficult.”

The sophistication required for this type of crime suggests that it is perpetrated by organized elements. “It has to be planned out. It is not opportunistic,” said Marino. “Based on the ease and nature of the crime it make sense that this will only grow and get worse.”

Likewise is the increasing willingness of cargo thieves to steal from secured yards. The CargoNet report shows that cargo theft from secured yards increased by 67 percent in 2013 over 2012. “Warehouses and distribution centers are target rich environments,” said Marino. “That’s where the volume is. That’s also why so many incidents take place at truck stops and parking lots.”

The same phenomenon explains why cargo theft incidents are concentrated in the eight states that account for 78 percent of the occurrences. Marino doesn’t attribute much significance to the drop n reported incidents in California, saying it may be attributable to a delay in reporting. But the spike in incidents in Georgia illustrates increased activity along the I-95 corridor. “Billions in cargo move through Georgia on its way to Florida,” said Marino. “That is where the volume is.”

What can shippers and carriers do about cargo theft? They need to harden the targets, said Marino, and history shows that such efforts work.

“Food and beverage shipments are now thieves’ favorites because they believe they are soft targets,” said Marino. “In years past, electronics, pharmaceuticals, and tobacco were stolen much more often but those industries have locked it down.”

The problem is that the food and beverage industries are reluctant to invest in expensive security systems to secure their relatively low-value shipments. “If you are hauling a load of lettuce worth $20,000, can you afford to apply a tracking device to that load?” said Marino. “The answer is increasingly yes. New technologies coming on the market that makes tracking of these types of loads affordable.”

The alternative is for shippers’ legitimate supply chains to compete with stolen goods. “When these thieves offer their loads to Ma-and-Pa grocery stores for one-third of the legitimate price,” said Marino, “they are going to take those goods and put them on their shelves.”

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American Journal of Transportation

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Peter Buxbaum has been writing about international trade and transportation, as well as security, defense, technology, and foreign policy, for over 20 years. Besides contributing to the AJOT, Buxbaum's work has appeared in such leading publications as [em]Fortune, Forbes, Chief Executive, Computerworld, and Jane's Defence Weekly[/em]. He was educated at Columbia University.