Every day reports of stolen cargo cross my desk here in Chicago: thefts in Georgia, Texas, California, New Jersey, Illinois,Mexico, China and Europe; thefts of electronics, computer parts, pharmaceuticals, clothing, foodstuffs, metals, wood, tires, and any other product that can be sold or bartered on the market. The variety of commodities stolen, and the methods used to steal them is constantly amazing.
The most common MO (modus operandi) for large scale theft is the theft of an unattended trailer or container. It is an unfortunate reality that there are more trucks in the United States than there are parking lots, and certainly more trucks than there are secure parking lots. Given that fact, is it any wonder that drivers leave trucks at unsecured truck stops, retail parking areas, on the street or in vacant lots? The majority of container and trailer loads of cargo that are stolen are taken when the load is unattended. Some of these thefts are random, and are carried out by people who arrive on the scene with a bobtail (no trailer attached) tractor, hook on and drive away. Others are carefully planned, with research into the expected cargo, the route, the schedule and the driver’s habits. Some involve driver complicity. Some thefts involve fraud. Some years ago a freight broker in Memphis posted a load of electronics on the internet looking for a trucker to take the load from Atlanta to Miami. They received a call from a man stating he was with XXX Transport, and that he had a driver nearby who could pick up the load the next morning. While XXX Transport was familiar to the broker, the man calling was not, so they obtained a phone number to call him back. When they called, a female voice answered “XXX Transport”. They asked for the man by name and were told he was on a call, but that if they could wait a moment, he would take their call. A minute went by with “muzak” playing, and he came on the line, confirmed his identity, and provided the broker with a number to which documents for the load should be faxed. They sent out the documents, the driver arrived the next morning, the shipper loaded his truck with electronics, and he left. Six hours later he called the broker and reported that he had experienced engine trouble on the highway to Miami so would be late. They advised the consignee and awaited his arrival the next day. The next day came and went and the load was never seen again. Investigators later found that the number they called for verification was a mailbox/business service office in Miami and that the woman and man had rented a phone from them for a morning. The fax number turned out to be at a motel on I75. In 2003, a completely legitimate trucker was contacted by a major manufacturer and told to pick up a load of computers in St. Louis for delivery to Toronto. The trucker arrived the next day, picked up the load, and delivered it to a warehouse in Toronto where he was met by personnel in company uniforms. The manufacturer, which had done business with the buyer before, sent out an invoice, and received a call asking why a bill had been sent since no order had been given. Investigators discovered that documentation that exactly duplicated purchase orders from the supposed buyer had been made up in the business office of a Toronto hotel and sent to the manufacturer. The warehouse location in Toronto was found to be empty, and discarded company uniforms were found in a back room. A large group, mostly Cuban, has operated a sophisticated theft ring out of Hialeah,Florida for a number of years now. We estimate that they have stolen over $300,000,000 in cargo in the United States since 2000. Arrests of members of this gang have been made in California, Ohio,Illinois,New Jersey, and a number of southeast states. One of their most common MO’s is used for warehouse burglaries: First, they check out the location. The loading docks are watched (either from inside or nearby) so confirm the type of cargo going out. Patterns of loading and delivery are documented. Then, usually over a weekend, and often on holiday or special event weekends when police are busy, the alarm system at the warehouse is set off. The thieves sit back and wait for the first responders to come. After they leave, they set off the alarm again, and again they wait. Eventually, the first responders decide that the alarm is faulty and don’t come back, and the thieves enter the warehouse and spend all night emptying the cargo into trucks. In November of 2006 they stole 65,000 cell phones valued at $13,500,000 from a Chicago suburb using this technique. Particularly vulnerable are warehouses without back-up alarm systems. Investigators later found cumentation that six trucks had been stolen locally and used to haul the cargo. People using fake Cuban names, but Florida addresses, had registered in local hotels. A rental car, later noted as having been driving through the neighborhood, was found to have been rented to a Florida driver. This theft occurred over the Thanksgiving weekend. A similar theft, but during a summerfest event, had occurred not five miles away in 2005. These are but a few of the methods being used. As industry tightens up its security, the thieves find new ways to break it. (Note: all of the above stories are based upon actual events, but the facts have been altered to protect the companies involved.) As modern industry has tightened its procedures, thieves have improved their own methods and technologies. Shippers, carriers and underwriters need to be aware, and need to keep up with methods to protect cargo in transit. Alan F. Spear, Director Cargo Security Loss Control AIG Global Marine May 1, 2007 ©AIG Global Marine and Energy
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BY ANGELA GREILING KEANE
Copyright 2006, Traffic World, Inc. A provision in the Patriot Act establishes a new cargo theft category for federal crime reporting purposes, a move shippers and law enforcement officials hope will curb increasing thievery of goods in transit. The Patriot Act, which President Bush signed March 8, puts cargo theft in an exclusive list of serious crimes that the Federal Bureau of Investigation tracks through the Uniform Crime Reporting Program. It’s not a silver bullet, but with cargo theft having its own classification within the UCR, in the long run, I think it will help law enforcement, International Cargo Security Council Executive Director William Corley said. ICSC members have lobbied for years for cargo theft to be its own UCR category. They succeeded this year with the help of Rep. Cliff Stearns, R-Fla., whose Cargo Theft Prevention Act was wrapped into the new Patriot Act. One estimate places the loss through cargo theft at $25 billion a year, said Stearns. This crime costs more than all bank robberies, computer piracies, burglaries and identity thefts combined. Profit from cargo thefts often goes to fund organized crime or terrorist activities, and we know that terrorists can make a lot of money stealing and selling cargo. Neither the FBI nor the cargo industry has a good handle on how much cargo is stolen each year given the lack of coordinated reporting on the subject. We can easily say that cargo theft costs U.S. businesses tens of billions of dollars per year, Corley said. In addition to adding the cargo theft category to the crime reporting system, the Patriot Act increased jail time for cargo theft convictions. Theft of cargo worth less than $1,000 is now punishable by three years in prison, while incarceration can be up to 15 years for cargo theft worth more than $1,000. Stearns picked up the issue several years ago after his local newspaper ran a series of stories on the growing problem of the theft of truck trailers in his part of Florida. In recent years, shippers and law enforcement officials have reported that cargo theft is increasing. At a hearing last year before the House Judiciary Subcommittee on Crime, Terrorism and Homeland Security, shippers and others said that cargo theft is an unfortunate byproduct of tightening supply chain security across the board. The other categories the FBI tracks through the UCR, which is a voluntary reporting system, are murder and nonnegligent manslaughter, forcible rape, robbery, aggravated assault, burglary, larceny-theft, motor vehicle theft and arson. By Nick Erdmann Cargo theft has impacted nearly every industry, from paper products to televisions. Experts estimate that cargo and equipment theft costs 30 to 50 billion annually worldwide. Security is a necessity today; with the nation on heightened security alert, the transportation industry must be prepared. By its very nature, the transportation industry places goods in a more vulnerable environment than when they are at a shipper’s or receiver’s facility. It’s not like having your goods in a warehouse; you cannot post a security guard, install lights or a closed circuit TV or build a fence around your freight. Expensive freight is moved along highways and by sea everyday and physical security devices and new tracking devices are becoming more of a necessity for trucking and container companies. New security procedures and rising insurance costs are also driving companies to secure their fleet. Before 9/11 companies would lock and seal only some loads that were deemed high value, and accepted theft as a cost of doing business. Today many security conscious companies have taken steps to combat theft of their equipment and products. These security procedures range from “low tech” physical security devices to “high tech” tracking devices. These devices are becoming more affordable, allowing companies to develop security programs incorporating one or both of these security devices, and drastically reducing the number of thefts among their company. Physical Security Solutions High security locks and seals are not a luxury item for transportation companies anymore. Physical security has become an effective tool in preventing cargo theft within the transportation industries security programs. Companies using high quality padlocks, king pin locks, air cuff locks and seal guard locks have effectively prevented cargo thefts. When choosing a physical security device, a company must take into consideration their: fleet, equipment and employees. High security locks must be of high quality and be flexible to the companies needs. The physical security company’s products and reputation must also be reliable to ensure compatibility and service of those locks in the future. These steps along with a solid company policy will ensure a seamless security program. Trailer Security High security padlocks must be resistant to physical attack and being picked. These locks also must be able to withstand the harsh environments that containers and trailers are exposed to. These padlocks also need to be user friendly, allowing the company to set up a system that is flexible, yet provides the utmost security for their equipment. Characteristics of a good high security lock allow for master keying systems and restricted keyways, limiting the possibility for unauthorized duplication of keys. In addition to securing rear trailer doors, companies must evaluate their need to secure unattended drop trailers and terminal trailers. There are many options including providing a secure drop yard for loaded trailers, which minimizes theft occurrence. High security king pin locks can be used to prevent unauthorized fifth wheel hook ups to trailers. Effective king pin locks should be able to be keyed into a company’s master keying system, allowing for added security. High security king pin locks should be constructed of heavy duty steel and be resistant to physical attack and be pick resistant. Transport Security, Inc. supplies both trailer and tractor high security locks that meet the security demands of the transportation industries. The ENFORCER® Adjustable Lock for example, is a portable heavy duty lock that consists of 10 gauge chrome plated spring steel body and the locking component is surrounded with cast iron, preventing tampering. This device allows for a tight fit on virtually all containers and trailers and is secured with an ABLOY® lock that provides superior performance in weather and is highly resistant to physical attack. Tractor Security Thieves are not only stealing loaded trailers, but also taking the tractors. These tractors in some cases are then used to steal trailers. Properly securing these expensive tractors starts with driver education and responsibility. Drivers must always lock doors, turn off the truck and secure the tractor brakes with a high security air cuff lock, preventing the release of truck and trailer brakes. Theft of a truck can happen within a few seconds of a driver leaving his truck unattended at a truck stop. Air brake locks must be user friendly, allowing the driver to easily attach the device to his brake nozzles within seconds. Properly securing a tractor can help prevent thieves from easily driving away with not only a loaded trailer, but an expensive tractor. The Air Cuff™Lock is an example of a brake lock that is a two part lock made of high impact resistant material and secured with an ABLOY® lock cylinder. The lock is user friendly and is installed on the brakes within seconds, completely locking out the tractor and trailer brakes. Preventing seal integrity has become more of an issue since 9 /11, especially with shipments of food and chemicals. Shippers have refused loads that show evidence of seal tampering, costing companies thousand of dollars. We have come to the point that we need to protect the seals themselves. Seal guard locks provide a barrier box that prevents unauthorized removal of cargo seals. These devices are made of a high strength steal and withstand physical attack. These units can be used in tandem with trailer locks to protect the cargo seals’ integrity. With heightened security for the transportation industry, physical security has merged with high tech tracking devices. These tracking devices enable a transportation company to accurately locate their assets in transit. There are an abundant amount of tracking devices on the market today, each having their own advantages and disadvantages depending on your companies needs. Three of the most popular types of tracking devices include GPS, A-GPS (Assisted GPS and CDMA (Cellular). With any tracking technology your company chooses, researching the product and the supplier is very important, given this can be an expensive investment. Companies should compare technologies and run specific tests with their equipment and staff, making sure the technology is compatible with their company. Tracking Technology Basic GPS units have been around for years with great success. These devices collect and store data such as time, latitude and longitude from GPS satellite while the unit is in use. Once the unit returns, the information on where the unit has been can be downloaded onto a computer into easy to read maps. These devices are accurately able to show stops and starts, location, speed and other important data. GPS devices tend to be bulky in nature and require external antennas mounted on trailers and containers and must be able to “see the sky” in order for the unit to work effectively. This limits the use of units in underground parking garages and warehouses, where thieves are more likely to transport stolen cargo and equipment. These units also tend to be “power hungry”, limiting their battery and power life. These units are very effective for those companies who require a fleet management device for locating their fleets and for time management of deliveries. A-GPS is a fairly new type of GPS device that has all of the features of basic GPS, but is more effective in areas where GPS is not. A-GPS is able to be very covert and does not have to “see the sky”, with an internal antenna in some cases. Many of these devices can be the size of a cell phone or smaller. Many devices have self contained batteries, making it completely portable allowing them to be concealed in freight. This allows less chance of a thief discovering and disengaging the unit. A-GPS allows for real time tracking of an asset that can easily be seen on a laptop or computer, in real time sometimes reporting locations within seconds of “calling” the unit. With the compatibility of these units and complete user control, allows security personnel to have an exact location of their asset at their fingertips. Another feature A-GPS offers is “geofencing”, which allows security personnel to define a location they want their asset to stay inside of, (ex. Terminal or certain route) and are notified via email or cell phone when their asset leaves the defined “geofence”. Accurate locations of assets with this technology are made easier, with mapping technology that shows exact street names and major landmarks. These devices are also less “power hungry”, therefore allowing a longer battery life, in some case as long as a month. This makes these units more effective for longer shipments along the supply chain. Some of these newer devices use CDMA technology, which allows the unit to incorporate the cellular towers and technology for more accurate locations. Combining all of these features allows A-GPS/CDMA devices to provide a complete range of anti-theft and supply chain management tracking applications. Conclusion Technology is evolving everyday, with more sophisticated tracking devices and physical security options for the end user. Companies looking to secure their entire fleet are now combining the “tried and true” physical security products with the new technologies of the tracking devices, allowing for a complete security program. Ultimately saving the company money and lowering the risk of their cargo being stolen. Security programs must be thought out and well planned in order for the chain to be effective. February 19th, 2005
Nebraska carrier designs device to protect against unnecessary cargo claims By Sean Kelley Tom Pirnie is the kind of guy who worries about bad things that can happen to his business and does something about them. Last year, Pirnie, president of Grand Island Express, heard that one of his competitors lost $4,000 because the flimsy seal affixed to the competitor’s trailer broke between stops. So he enlisted the help of an inventive cousin to keep the same problem from occurring to the Grand Island, Neb.-based carrier, which employs 90 company drivers and 45 owner-operators. “Most of the things we’ve learned in our business, we’ve learned by doing it wrong first,” Pirnie says. “The best learning experiences are the ones that happen to someone else.” More than 50 percent of loads hauled by Grand Island Express is beef— much of it coming from a processing plant across the street from the carrier’s headquarters. The company hauls the meat west to neighboring Colorado and east to the Atlantic Seaboard. The loads often require multiple drops, which is where problems can arise. When a load is first put on a trailer, the processing plant affixes a seal, a thin strip of numbered metal or plastic that is bound through the trailer’s hasp lock. When part of the load is delivered, the receiver affixes a new seal through the hasp and so on, until all the loads are delivered. In the past, a broken seal simply meant that the receiver and driver would count units of beef, and if the count was accurate, everything was fine. But the Sept. 11, 2001 terrorist attacks — and fear that the food supply could become a target — changed all of that. In 2003, a driver for one of Pirnie’s competitors arrived at his second receiver on a multi-stop run with a missing seal. Instead of counting the load and taking delivery, the receiver declared the load unfit for human consumpnon, and it was rendered. “They were fearful the meat might have been tampered with,” Pirnie says. “They charged the carrier $4,000 for the load. I’m not even sure if that was legal, but I’d rather not have to pay myself.” For the receiver, it didn’t matter who was at fault in the situation. The first receiver might never have affixed a seal. It could have broken in transit or it could have been snipped by a competitor. Since the driver is the only one who can open the lock, the driver controls access to the seal and can be held accountable for any problems. “When we heard about the story, we asked ourselves what can we do to make it more difficult to tamper with a seal,” Pirnie says. The carrier that lost the load was lucky: The portion that was rendered was a partial shipment of cheap meat. If it had been a full load of high quality beef, the cost could have been much more substantial. “If it had been a full load of rib eyes — that’s way over a dollar a pound. A cargo claim like that would raise your rates.” Grand Island Express trailers already feature a low-tech security device designed to prevent cargo theft — a small metal bar affixed with a bolt to the trailer frame that prevents the door from being opened. A large Allen wrench is required to remove the bar, and Pirnie says thieves typically don’t carry Allen wrenches in that dimension. The bar can he defeated, hut it takes time — something Pirnie says most thieves don’t have. While adding security to the door was relatively easy, protecting the seal provided a greater challenge. The company had to develop a box to cover the seal and the hasp assembly and still resist efforts by a determined thief. The idea came from Pirnie’s cousin, Keith Pirnie. The carrier’s chief technician, Randy Kunze, produced a working model. The design had to work with cable seals as well as flat metal or plastic seals. The group of would-be inventors spent time wandering through their customer’s yards looking at trailer models and seeing what the seal guard’s design required. After a couple of months of fiddling, the team had a prototype. They took it to a local manufacturer, who produced 50 seal guards. Pirnie passed theiii out to his drivers to experiment with them. The staff also did its best to break into the locks. Pirnie took part in some of the testing himself, slinging a heavy sledgehammer at the final product until he bent the pin so badly it nearly required a blowtorch to remove. Pirnie says his drivers are trained to inspect seals and have never had a claim like the one that his competitor suffered. The new lock makes that job easier, in part, because receivers can’t break the seal without the driver removing the box. “A receiver will say ‘I’ll just break the seal” Pirnie says. “My driver will say ‘Go ahead and try.’ This gives something additional for our drivers to do to make sure the seal is in place.” The final hasp and seal cover consists of three parts:
“The exciting thing is that shippers and trucking companies will benefit from the invention,” Albrecht says. Transport Security has improved the lock’s design, making it more difficult to defeat. “I’m not saying you can’t get in there, but it’s going to take tools and time,” Pirnie says. “With seals, you don’t know until you have a problem. We got a break in that it happened to someone else.” Now with his innovation, Pirnie is hopeful the problem never happens to him. February 14th, 2005
By John Albrecht, Vice President, Transport Security, Inc. In the transportation industry, a strong security and loss prevention department is a necessity, not a luxury. Theft of cargo and equipment is estimated to cost $10 billion to $15 billion annually. Depending on your operating ratio, it takes $10 to $15 in increased revenue to make up for every dollar lost through theft. Progressive corporations should be guided by a strong security and loss prevention program, rather than depending on a crisis management team to react after the crime has taken place. An effective security and loss prevention program should include the following: employee screening, a loss reporting system, a reward program, physical security and law enforcement involvement. Employee screening is an important aspect of a successful company. An employer should keep in mind that a stable and honest employee will have credible references from past co-workers and former employers. Developing a thorough background investigation procedure can single out a less desirable applicant. Employers should ask for specific information, such as names and phone numbers of past employers. If the applicant cannot provide this information or any other facts requested on this form, he or she should not be considered for the job. If the applicant skips a question such as “Have you ever been convicted of a felony?” the company should not assume the answer was no. It is necessary to educate all drivers of their responsibility to report any losses of cargo or equipment via a loss reporting system. Unreported small losses can quickly add up to substantial sums at year’s end, but by this time it is too late to take any action. Drivers should be able to contact a company official 24 hours a day when theft occurs s’ that immediate action can be taken. The development of a loss report form is important to obtain all pertinent information regarding a theft: date, time, location, license numbers of the tractor and trailer, the vehicle identification numbers of the tractor and trailer, the make and model of the tractor and trailer, a description of commodity hauled, driver report, police notification and any suspect. Quick and effective reporting will increase the chance of successful recovery of stolen property. Reward programs that pay for information are very effective. These programs must be administered very carefully, however, and in for matmon guarded to give credibility. The program should include a toll-free telephone number that is dedicated to reporting fraud, theft or misconduct within the company. To develop an effective security and loss prevention program, strong physical deterrents are essential, including king pin locks, seals, padlocks, rear door locks and steering locks. King pin locks protect trailers from theft while they are spotted at terminals or retail stores. The use of numbered seals on shipments, including multi-drop loads, is strongly encouraged. Padlocks and rear door locks are very important in the reduction of pilferage. Fleets initiating a strong lock and seal program have drastically reduced cargo theft. There are many organizations involved with security and loss prevention: American Society of Industrial Security, Safety and Loss Prevention Management Council of American Trucking Associations, International Association of Chiefs of Police and National Cargo Security Council. Also, law enforcement and transportation companies have started regional cargo theft task forces. These include Mid-West Cargo Security Council, Chicago; Eastern Regional Transportation Security Council, Mybrook, N.Y.; Western States Cargo Theft Association, Cypress. Calif.; Midsouth Cargo Security Council, Memphis, Tenn.; Southwest Transportation Security Council, Dallas; Southeast Transportation Security Council, Atlanta: and Florida Cargo Security Council, Miami. The objectives of these organizations are to reduce theft, develop contacts, exchange theft reports and establish a liaison with law enforcement officials in the cities where your fleets haul freight. Thefts can never be totally eliminated, but strong preventive measures are vital in combating theft and maintaining good profit levels. |
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