Cargo Crimes, Supply Chain Disruption Increasing at an Alarming Rate
A recent survey of retail security directors showed that almost half of those polled had been the victims of a supply-chain disruption directly related to cargo theft in the past year. This is a significant increase from just five years ago.
Envision the following scenario. You are at home around 8:15 at night watching television with your wife or kids when the phone rings. The caller is one of your regional LP managers in the Southeast. He tells you that you just had a tractor load of high-end apparel worth $2,000,000 stolen in Florida while parked at a truck stop. The driver had gone in to use the facilities, and when he came out ten minutes later his tractor and trailer were gone. While no one ever wants to receive a call like this, you can be prepared for it.
In order to fully understand the issue of cargo theft, you need to know why it exists, who is perpetrating it, how you can reduce your risk, and ultimately how to react to a cargo theft loss.
Most of those reading this have had some level of store- or logistics-security exposure. Good loss prevention programs involve some form of a “layered” approach. Based on the exposure, some, if not all, of the following countermeasures may be employed—surveillance cameras, alarms, locks, lighting, EAS, safes, employee awareness training, and others. Loss prevention professionals would be remiss in their duties if they did not explore all of these attributes to secure their stores.
That said, remember that virtually 100 percent of the merchandise in retail stores is delivered by truck. In many cases the only two preventative measures put in place to secure that same merchandise and deter cargo theft in transit is a key to the tractor and a seal on the rear doors.
On any given night there are hundreds of thousands of loads of merchandise parked in unsecured locations around the country. This is a well-known fact to various criminal elements, from organized Cuban and Eastern European cargo theft crews to local gangs like MS-13.
Risk vs. Reward
The average value of a stolen shipment in-transit last year was $300,000 according to FreightWatch International, a risk management service provider. Compare that figure to two other serious crimes—bank robbery, which according to FBI statistics nets roughly $2,000 per event, or a typical organized retail crime (ORC) that nets about $8,000. There’s obviously a large disparity in the net profit out of each of these cargo crimes. There is also a great disparity in the punishments if apprehended for each of these offenses.
Someone convicted of ORC can face up to three years imprisonment. A convicted bank robber typically receives a five- to ten-year prison sentence. An individual apprehended for cargo theft, however, routinely faces very minimal incarceration and, more often than not, receives some form of probation…yes, probation. One example is a career cargo criminal from South Florida who operated out of New Jersey. This Hispanic male was arrested nine times for full trailer-load cargo theft, but has done less than two years in prison…total, for all of these offenses.
In most cases the cargo thief goes undetected in the commission of his or her crime and is very rarely confronted by law enforcement, who aren’t made aware of what has occurred until long after the shipment is gone.
A key event that increased the popularity of this type of crime occurred in 1986, when the government passed the Anti-Drug Abuse Act. This placed mandatory minimum sentencing guidelines in a continuing effort to fight the war on drugs. The guidelines were stiff, with long minimum prison terms if one were caught selling drugs. These stiff sentences forced certain criminal elements to find new revenue streams. With its low risk versus high reward, cargo theft presented a new business opportunity for these criminals.
A Rising Trend
In the past five years cargo theft crimes have risen over 150 percent and are still climbing. The annual losses attributed to these thefts are estimated in the billions of dollars. The disparity in attention attributed these numbers is tied directly to the common perception that these types of crimes are essentially “victimless.”
The lack of formal reporting of cargo theft incidents has also been a significant hindrance in getting any assistance from the government. In 2006 as part of the Patriot Act renewal, an amendment was added that designated cargo theft as a Part 1 crime that must be reported within the Uniform Crime Report (UCR) system. Unfortunately, as we sit here eight years later, the FBI has still not completed the collection and dissemination processing of that data.
Although cargo theft occurs all over the country, there are higher than average concentrations centered in states that have major port activity, as many of these thieves desire access to as much freight as possible. It’s important to understand that these criminals fall into two significantly different types. The first type of cargo theft involves a thief that is simply looking for the opportunity to steal virtually any load; while the second targets specific merchandise. Both illicit groups are professionals, yet they go about their trade using different methodology.
The opportunistic thief typically targets any loaded trailer left unattended in a relatively unsecure location. This could be a truck stop, mall parking lot, or even in or near your store or distribution center.
The thieves targeting specific merchandise operate quite differently. They will first decide, or be directed to, a particular desired product—a certain brand of cell phone, a particular pharmaceutical product, tobacco products, and so forth. They will conduct pre-trip research looking into locations of associated distribution centers within a specific geographic area. They will also look for proximity to interstate highway systems, the locations of law enforcement facilities and activity, as well as weigh stations.
There have actually been times when these particular thieves have been caught with shopping lists, either on their person or in their vehicles. The lists describe specific items to steal, as well as where to find them. These same criminals have also been found with police scanners and other forms of cargo theft tools.
The perpetrators will typically work in teams, conducting surveillance on both facilities and drivers to understand how those in the facility distribute shipments and how the drivers act when picking the loads up.
Sometimes the thieves will hit drivers on the road, following them in multiple surveillance vehicles and trailed by another tractor. The tractor will be utilized as a substitute once the rig has been stolen. This type of surveillance sometimes lasts for hundreds of miles, or until the driver needs to make a stop. Once the driver leaves the tractor-trailer unattended, it typically takes the thieves less than one minute to break into the locked cab, hotwire the unit, and subsequently drive off with the load.
In these scenarios the thieves look to get rid of the original tractor as soon as possible, substituting it for the one they brought along. The original tractor is almost always recovered a few miles from the original theft location. All of this is done to better disguise the two-part unit as the getaway is being made, but also to attempt to evade any GPS tracking that may have been installed in or on the original tractor.
The thieves may do something similar with the trailer, also attempting to see if GPS tracking technology is being used to locate it. In many instances they’ll take the trailer to a remote location, place it under surveillance for several hours, and wait to see if someone comes for it. If no one does, their natural assumption is that there isn’t any tracking technology either attached to the trailer or buried inside the shipment.
If the plan involves the burglary of a facility, as opposed to an in-transit theft, once the target location has been selected, a team of specialized criminals will attack it. Each member of the team will have a specialized talent, such as picking locks and defeating alarms and CCTV. They will have team members trained on operating material-handling equipment as well as general laborers to load the stolen goods.