A troubling transformation is underway in the landscape of cargo theft across North America. Recent data reveals a startling 59% increase in cargo theft incidents in Q3 year-over-year, in the United States. Experts anticipate this escalating trend will persist into 2024, sounding the alarm for supply chain companies to enhance security protocols before falling victim.
The first half of 2023 saw a slight increase in cargo theft rates in the U.S., with a 1% rise compared to the same period in 2022. This trend is part of a larger pattern that has seen a 22% increase in cargo theft volumes between 2021 and 2022, accompanied by a 48% increase in average loss value per theft. Notably, the second quarter of 2023 alone witnessed a staggering 57% increase in recorded cargo theft events, totaling 582 incidents across the United States and Canada, as reported by CargoNet.
In Q3 of 2023, CargoNet reported $31 million in shipments stolen– with many of those losses due to ongoing shipment misdirection attacks. All of these year-over-year increases have led experts to suggest that 2024 will be yet another year of record-breaking cargo thefts.
Strategic theft, involving criminals impersonating legitimate carriers to steal loads, has permeated beyond high-risk markets like California and Texas into the heartland. These sophisticated schemes often transport stolen goods back to coastal areas for international shipment.
Danny Ramon, the intelligence and response manager at Overhaul, underscores the necessity for supply chain companies, especially in smaller markets traditionally less targeted, to escalate their security protocols and remain acutely aware of these evolving threats.
A disturbing trend observed around ports is the increase in pilferage, involving the theft of pallets or partial truckloads. Unlike organized cargo theft rings, these crimes are often perpetrated by local criminals who may resort to more violent means. “The trend towards violence in cargo theft is expected to rise in line with the formation of large-scale pilferage crews,” explains Danny Ramon. These groups, often comprising individuals already involved in violent crime, show little regard for the escalated penalties associated with violent theft, contrasting sharply with the typically non-confrontational approach of organized full truckload (FTL) cargo thieves.
Several factors contribute to this rise in cargo theft. Organized criminal groups are increasingly targeting specific, high-value shipments with sophisticated methods. These thefts often occur at unsecured parking locations and truck stops, where cargo units are left unattended. Moreover, there’s an observed rise in the use of violence and the practice of following shipments from their origin, with criminals willing to track loads for hundreds of miles before executing the theft.
Cyber manipulation within the industry also remains an emerging concern. The number of criminal carriers hacking truck brokerage operations increased over 400% in the past year, according to Ron Green, VP of Business Development at Overhaul. This staggering surge signals an urgent need to enhance cybersecurity measures across the supply chain.
A notable trend is the prevalence of shipment misdirection attacks, a form of strategic cargo theft. In these schemes, perpetrators use stolen motor carrier and logistics broker identities to divert freight from its intended destination, thereby enabling the theft of the cargo. This method has become a key driver in the rise of cargo theft, with the average value of each theft event rising substantially, indicating a focus on high-value shipments.
The theft of loaded conveyances, such as full trailers, has also seen a significant year-over-year increase. States like California, Texas, Florida, and Illinois are most affected, with regional activity around New York City and Philadelphia also being significant.
The methods employed by cargo thieves have evolved, ranging from deceptive practices and hijacking to insider involvement and exploitation of stolen or fake identities. The Internet has played a crucial role in facilitating cargo theft, offering criminals access to a wealth of information, and enabling them to efficiently target and offload stolen goods.
In response, various proactive measures are being implemented to combat this rising threat. These include enhancing technology for theft prevention, educating stakeholders, monitoring hotspots, and strengthening legal and regulatory frameworks. Collaborative efforts across the industry are essential, with a focus on building community networks and maintaining vigilance against these criminal activities.
The implementation of standard operating procedures, like multi-factor authentication and thorough verification of partner information, is vital. This extends to confirming email addresses, phone numbers, physical addresses, and DOT numbers.
The issue of supply chain risk is gaining traction at the executive level as well, with C-suite executives and managers increasingly focusing on assessing and mitigating risks associated with supply chain and logistics operations. Kevin Ledversis, VP of Sales at Newcastle Systems, suggests that proper labeling of logistics operations, including the use of RFID chips for asset tracking, can significantly reduce theft risks. He notes that the propensity for theft escalates in challenging economic times, urging carriers to remain vigilant and informed about the vulnerabilities of the freight they transport.
Ultimately, the continuing rise in cargo theft as we approach 2024 calls for a heightened and multifaceted response from the transportation and logistics industry. From small-scale operators to large corporations, the adoption of thorough security measures, enhanced vigilance, and proactive risk assessment is imperative to safeguard against this growing threat.
How Fleets Can Prepare to Face Potentially Record-Breaking Cargo Theft in 2024
The primary issues to be aware of are threefold. Insider threats, regulatory gaps, and risk mitigation. When all three are addressed or compensated for, theft can be significantly reduced or deterred.
- Insider Threats: Employees and contractors, privy to sensitive information, can facilitate thefts by exploiting their knowledge of security systems and business processes. Their insider position allows them to identify vulnerabilities, often collaborating with external criminals.
- Regulatory Gaps: In regions with lax security measures, insufficient law enforcement resources, or inconsistent enforcement of cargo theft laws, criminal organizations find fertile ground. These gaps in the regulatory framework enable them to operate with relative impunity.
- Mitigating Risks: To counter these threats, a multifaceted approach is necessary:
- Enhanced Security Measures: Robust security infrastructure, including surveillance cameras, tracking systems, and access control systems, are essential. Integration of physical security with cybersecurity provides a comprehensive defense mechanism.
- Cybersecurity: As organized crime adopts advanced technologies, businesses must fortify their cyber defenses. Secure communication channels, firewalls, and software updates are critical, alongside the convergence of physical and cyber security.
- Employee Training and Screening: Educating employees about cargo theft risks and conducting thorough background checks are vital. Promoting a security-conscious culture and encouraging the reporting of suspicious activities helps mitigate internal threats.
- Route Planning and Monitoring: Advanced logistics software and GPS tracking systems optimize routes and monitor shipments in real-time, though the potential for GPS deactivation by criminals should be considered.
- Collaboration with Law Enforcement: Partnering with dedicated law enforcement units and sharing intelligence can aid in thwarting cargo theft.
- Cargo Container Security: Utilizing tamper-evident seals and locking systems and exploring technologies like live video monitoring in yards, cargo bays, and warehouses as well as blockchain can enhance container security.
- Insurance and Risk Management: Regularly updating cargo insurance policies and collaborating with risk management experts help in covering potential losses and identifying supply chain vulnerabilities.
- Supply Chain Transparency: Sharing information with trusted partners within the supply chain fosters a collective approach to security.
- Legislative Advocacy: Pushing for stronger cargo theft legislation and improved enforcement in areas with regulatory shortcomings is crucial for long-term solutions.
Live video monitoring is increasingly recognized as an effective tool to combat cargo theft, offering several tangible benefits to businesses and fleet managers. These benefits include:
- Enhanced Fleet Security and Loss Prevention: Live video monitoring significantly improves fleet security and aids in loss prevention in various ways. It enhances driver accountability, encourages safe driving practices, and keeps an unbiased evidence log of activities inside and around the vehicle. This level of monitoring reduces the risks associated with theft and vandalism and can provide vital evidence in the event of an incident.
- Proactive Crime Deterrence and Risk Mitigation: Live remote video monitoring serves as a proactive approach to security, effectively deterring crime and mitigating risks. This is particularly crucial for locations housing valuable cargo, such as warehouses or distribution centers. High-resolution cameras and pan-tilt-zoom (PTZ) capabilities ensure comprehensive coverage and can capture high-quality images for evidence if a theft occurs.
- Advanced Security Features: Real-time visibility solutions, often part of live video monitoring systems, include features like comprehensive geofencing, tamper detection and alerts, seamless integration with existing security systems, and 24/7 monitoring. These features ensure continuous protection of cargo, especially during non-business hours, and provide real-time alerts in case of any deviations or unauthorized access. According to Adapt Ideations, a real-time asset tracking and cold-storage monitoring company, these additions can mean the difference between fighting a modern battle with outdated weaponry, and facing complex modern theft with modern solutions.
- Cost Implications of Cargo Theft: Cargo theft can have a substantial financial impact on businesses. The replacement cost of stolen items often exceeds their original price, and the cumulative effect of such thefts can significantly strain a company’s finances. For instance, each cargo theft event in the first quarter of 2021 was worth an average of $142,574, illustrating the potential financial repercussions for businesses.
- 5. Addressing Sophisticated Cargo Theft Methods: With cargo theft increasingly being committed by organized crime rings, businesses need sophisticated security measures like live video monitoring. These systems help in documenting and following processes and procedures, using smart locks, sensors, GPS trackers, and implementing robust security protocols to combat sophisticated theft methods.
- Improving Cargo Monitoring and Efficiency: Modern cargo monitoring solutions that include live video monitoring can protect cargo and enhance efficiency through advanced data collection. This includes monitoring trailer utilization, tracking the number of times a trailer door is opened, and ensuring the cargo remains within safe temperature ranges. Efficient monitoring can lead to significant savings on fuel and driver costs.
All of this is to say that live video monitoring provides a comprehensive approach to securing cargo, reducing the risk of theft, and improving overall fleet management efficiency. Its adoption not only serves as a deterrent to potential thieves but also offers critical insights into fleet operations, contributing to more effective and secure logistics management.
Interested in learning more about innovative and cost-effective live video monitoring solutions and how they can help reduce and deter theft and other risks to your bottom line in the coming year? Contact us today and speak with a distribution and logistics security specialist for a consultation.
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