Guarding Food Product Transports from the Hands of Thieves

On December 18, 2012, Canadian police arrested three people in connection with a massive maple syrup heist, which affected the global supply since Quebec produces nearly 80 percent of the world’s maple syrup. The syrup, which was stolen in August 2012 from a warehouse that stores Quebec’s maple syrup reserves, had an estimated value of $30 million. In addition to facing charges of illicit trafficking of stolen goods, those arrested also face charges of theft, conspiracy, and fraud. This was only the latest incident impacting the Canadian food industry, as there have been an increasing number of bulk food crop thefts in recent years.

The problem is not unique to Canada. In December 2012, an infant formula company in the United States began working with the Food and Drug Administration’s (FDA) Office of Criminal Investigations (OCI) and other law enforcement officials to recover cases of infant formula products that were stolen from a carrier’s lot in Grand Rapids, Mich.

In March 2012, thieves in Florida stole six trailer loads of tomatoes, a truck full of cucumbers, and a truckload of frozen meat totaling about $300,000. Prior to the incident, the thieves set up a phony trucking company called E&A Transport Express and registered it with the Federal Motor Carrier Safety Administration. They then stalked websites that brokers use to connect trucking companies with loads they need carried. From there they contacted a broker, which verified E&A’s federal registration and insurance coverage, and then arranged for them to pick up the tomatoes from a shipper in Miami. In four days, E&A Transport picked up the loads mentioned above with the intention of selling the stolen perishables to pre-arranged buyers.

Cargo theft is the costliest crime in America, but it is also an international issue. In today’s global food industry, raw materials are often manufactured and sourced in one part of the world, while finished products are stored and consumed in another, making shipments vulnerable at any point in the chain.

Pirates on the Horizon
Theft of lower valued goods has rapidly increased in recent years. According to CargoNet, a transportation theft prevention and recovery network, prepared food and beverage products were the most stolen commodity in 2012, followed by metals and electronics. From July to September 2012 alone, there were 56 reported food and beverage theft incidents in the U.S., while base metals and electronics tied for second with each having 36 reported theft incidents. California, Florida, Texas, New Jersey, and Illinois lead the country with the highest number of reported food product transport theft.

Other interesting statistics indicate that Friday, Saturday, and Sunday are the days when most cargo theft incidents occur; that the top three theft locations include warehouses or distribution centers, parking lots, and truck stops; and that the average loss values range from $50,000 to $1,000,000.

Part of the reason behind the increase in cargo theft incidents is the fact that it is essentially a low-risk, high-payout crime that carries only minor penalties. Thieves charged with stealing a load worth hundreds of thousands of dollars might only serve six months in jail, depending on the jurisdiction.

Food—A Hot Commodity
Prior to 2010, electronics held the #1 spot for most stolen cargo load. However, in 2010, 2011, and 2012, food and beverage products took the lead. This is due in part to the current economic crisis. Necessities, such as food and bottled water, are in higher demand, thus are easier to resell. It’s also due to the fact that the sell value on stolen electronics is not as high as it once was due to tracking systems, such as serial numbers and GPS. It’s reported that thieves can get 70 cents on the dollar for food and beverage on the black market, as opposed to 30 cents on the dollar for electronics.

Challenges
Although cargo theft is certainly an unfortunate economic blow to any company, it is a particularly nightmarish event in the food industry. Food and beverage companies have other factors to worry about in addition to financial and customer loss and a tarnished brand. Lives are at stake. When food transports are stolen, thieves are not worried about keeping the product at the right temperature or avoiding cross contamination during storage. In the often unlikely event that the products are recovered, the product is no longer considered safe. There is the risk that it is adulterated from not having been handled properly or the concern of intentional contamination.

Another challenge is that cargo thieves are often highly sophisticated and organized. As noted in the headline about the perishable goods stolen in Florida, thieves plotted the theft as much as a month in advance. They went through the trouble of registering their phony company, obtaining insurance, and seeking out transports on broker websites. Then, they had to have buyers pre-arranged to purchase their black market goods since the clock was ticking against the shelf life of the items they stole.

A few other challenges that theft victims face are the fear of insurance costs or damage to their brand, not knowing to which law enforcement group the theft should be reported, and having limited resources for educating drivers.

In the Blink of an Eye
Once stolen loads are acquired, the goods are moved quickly through a chain of hand-offs, often before the theft is even discovered by the manufacturing or transportation company. It only takes a matter of hours for organized thieves to move the stolen goods to a warehouse, off-load and repackage them, and load them onto another vehicle for distribution. This is known as product diversion in the security industry.

Stolen transports are acquired a number of ways. Thieves may “carjack” the trucks directly out of a driver’s grasp, or they may wait until a driver leaves the truck unattended at a rest stop and take it from there. In other instances, unattached trailers are stolen from a trailer yard. The thieves will attach their cabs to an unmanned, loaded trailer and drive away. Other times they will simply break into the dropped trailers, unload the cargo into their own empty trailer, and drive away. Regardless of which method is used, the thieves will monitor the activity, then wait for the prime opportunity to strike.

Not all cargo theft is done by an external party. In some cases, it is an inside job where the truck driver is paid off to give up his or her truck. Thieves will observe drivers at rest stops and fueling stations, then offer them a set amount to get in on the activity.

Experienced criminals may abandon a newly stolen truck or trailer then watch it from afar to learn if a tracking system is embedded in it. If law enforcement does not arrive within a certain timeframe, the thief will assume the stolen load has not been reported or is not being monitored and will then move it to a secured location to begin preparing the goods for resale on the black market. This may involve repackaging, relabeling, and even creating counterfeit bills of lading or other paperwork to more easily move the stolen cargo out of the country.

So, who exactly is buying these stolen goods? Most of the time, the brokered buyers knowingly purchase stolen property. They are able to get a lower price point on the stolen goods and are themselves part of the stolen transport ring. In other instances, the thieves are so good at deceit that they are able to sell the stolen property to unsuspecting businesses that are not part of the crime scheme.

Take Action to Prevent Theft

Be alert. Usually before a targeted theft occurs, there will be a period of surveillance while the thief is collecting information about a facility. He or she will watch loading/unloading procedures, monitor high and low periods of activity at the plant, and try to find a pattern in drivers leaving with shipments. Watch for signs that your operation is under the watchful eye of thieves. This might include unknown vehicles parked outside or within the parking lot with drivers inside, unauthorized personnel on the plant property, someone holding a camera or taking notes outside your facility, or vehicles that appear to be following your drivers.

Know your employees. Before hiring any drivers, conduct a background check to eliminate any applicants likely to steal merchandise or be persuaded to give up their trailers. Remember, cargo theft incidents are often later revealed to be inside jobs. Be especially watchful of new employees and temporary workers assigned to shipping and receiving areas.

Once your drivers are hired, provide initial and ongoing security training so that they are equipped to recognize suspicious activity, secure their vehicles when unattended, and promptly report security instances to the proper parties.

Know your affiliates. Just as drivers should be pre-screened before employment, your supply chain partners, including transport companies and distribution centers, should also pass some sort of established verification procedures before you trust them with your products.

Distribution centers are the top location for cargo theft to occur. Frequent assessments of your distribution centers and a solid inventory management system are excellent loss prevention tools to help prevent your cargo from going missing. Familiarizing yourself with distribution center activities makes it easier to recognize suspicious activity. Also, when employees feel that they are being watched and are at a high risk of being caught, they will be less likely to attempt to steal cargo.

Once a carrier is selected, verify its identity by checking registration numbers, insurance, etc., and review its security procedures to make sure these are in line with your requirements. When a driver arrives at the plant to pick up an outgoing load, verify the driver’s identity before releasing the cargo. Verification of driver’s identity goes beyond simply checking a government issued driver’s license. Ask your transportation companies to also issue company-provided identification. Both IDs should be verified against the driver’s name indicated on the bill of lading or other shipping document. If the name is not indicated, the transportation company should be contacted prior to loading the trailer to ensure this is the assigned driver. Does this require extra effort? Of course! However, as noted in the examples above, thieves are becoming bolder in their efforts to steal. These simple checks can go a long way in deterring organized efforts at theft and prevent “simple” thieves from trying to show up and pick up a load.

Stay informed of the status of your shipment along the way, including any delivery schedules, routes, and pre-arranged stops in trailer yards, and check in to make sure that adequate security measures are being provided en route. By staying informed, you can more easily be alerted to any overdue shipments or out-of-route deliveries.

Use security measures. Your Food Facility Defense Plan should include security measures and procedures to safeguard against transportation theft issues. It is also a good idea to inform and remind employed and contracted drivers of the best security practices to use while on the road. Some of those include:

• If a driver team is transporting the load, one person should remain with the vehicle at all times.
• Be cautious when relaying information via CB radio or social media. Don’t list specific details about location, cargo load, or final destination.
• Guard truck-entry points against thieves. Some drivers run a strap through their interior door handles while inside their trucks at night to prevent entry to the cab.
• If the trucking company allows travel pets, make sure the animal is trained to bark at intruders.
• If the truck is equipped with an alarm system, check it frequently to ensure that it is functioning properly.
• Practice safe parking habits.
  • Park in an area that is not isolated and has good lighting.
  • Seek out truck yards and rest stops that have good security protocols, including CCTV surveillance.
  • Never leave the vehicle unlocked while unattended; this includes while fueling, using the rest stop areas, or waiting on a fuel ticket.
  • Park rear to rear to restrict access to the trailer door. There are a variety of low-cost basic security equipment options that can be used to help thwart cargo theft.
     
• Locks. Locks are a big part of cargo security. There are several different types of locks used to help secure various parts of a tractor/trailer rig.
  • King-pin locks. King-pin locks are easy to install and prevent unauthorized hook ups to the trailer. Trailers are at a high risk when they are not attached to a truck. The king-pin lock covers and locks the king pin of the semi-trailer and prevents another truck from driving away with the trailer when parked in a drop location.
  • Glad-hand lock cover. The glad-hand connection on a truck houses the hoses that supply air to the brakes. The glad-hand lock cover inserts a pin into the connection that locks the trailer’s air line, preventing the truck from departing until the lock is removed and brake lines are once again operational.
  • Air brake valve lock. When installed, these locks prevent brake release by locking the brake controls.

The more locks in use on a cargo load, the less likely it is to be stolen. If a thief cannot overtake a trailer in less than two minutes, the chances of getting caught drastically rise. The more locks in use on a load, the sooner the thief will move on to another target that is easier to steal.

• Seals. Although seals will not prevent a determined criminal from gaining access, they will limit intrusion and create an alert for drivers and receiving employees that the doors have been tampered with if the seals are broken. Include seal policies in your defense program, and educate drivers on the appropriate actions to take if they notice a seal has been tampered with.
  Your company should also evaluate the types of seals to be used. There are many different seals and the level of security varies greatly. Some variables to consider are the geographic shipping origination point, in-transit corridor(s), and destination points. In the case of U.S./Mexican cross-border shipments, U.S. customs requires that shippers use seals classified as high-security by ISO/PAS 17712 if they are participating in the U.S. Customs Trade Partnership Against Terrorism (C-TPAT) program 4. In the U.S., shipments moving through areas known as high-risk shipping corridors may call for different security seals than those moving through lower risk areas. The physical environment to which a shipment will be exposed while in transit also impacts proper seal selection. It is not uncommon for shipments to experience extreme seasonal temperature changes when moving from their origination to destination points.
   
• Video Surveillance. Another low-cost security measure is the installation of CCTV-monitoring systems on the loading dock, in parking lots, and at gates, as a deterrent against criminal activity. The footage should be checked daily to detect any suspicious activity. Software programs are also available on the CCTV systems and can be programmed to monitor specific areas within the camera’s view, and send an alert or alarm to a security officer of any motion or activity within the specified view. An example of this use would be using this capability in a trailer lot after hours when there should be no people or vehicles moving in the area.
   
• High-Tech Security. In addition to the basic security measures, there are also a number of higher technology tools used to aid in cargo-theft prevention. GPS-tracking tools have been around for a while and are now available in many electronic devices. When installed in a vehicle, they are used to help determine its location if stolen. The downside is that these devices are very easily disconnected and disabled by professional thieves. Geofencing systems send a security alarm to the assigned recipient when a vehicle travels outside an assigned route. The virtual fence is established by the operator, then, if an equipped vehicle crosses the fence, an alert is sent via text or e-mail.

There are a variety of high-tech vehicle security systems to choose from as well. Perhaps the most basic is a panic button that alerts authorities or honks the horn repeatedly until help arrives. Some of these panic buttons will even slow the truck down to a gradual stop if it is engaged while in motion. Access-control technology can be installed, requiring drivers to enter an access code before being able to move the vehicle. If the vehicle was stolen while idling, the thief would not be able to drive off with it unless he knew the access code. Another advanced type of technology is a vehicle-immobilization system used to remotely disable a stolen vehicle.

Report Immeditely
Any suspicious activity should be reported immediately to management and law enforcement agencies. If you notice a trend in false alarms, don’t lower your guard. Frequent false alarms can actually be a sign that criminals are testing your security procedures and response times.

If you are notified that one of your loads has been stolen, don’t hesitate to report it to your company, but also to law enforcement. It is especially a good idea to report the theft to the state police in the state where the truck was stolen, in addition to the local police. State police agencies across the U.S. have specific measures in place to quickly track and locate stolen cargo and trucks and can communicate more quickly across state lines. The sooner you report, the more likely you are to recover. Remember, thieves move stolen goods quickly. It only takes a matter of hours for the stolen goods to be rerouted to black-market buyers.

Summary
Stolen food and beverage transports are on the rise and increasing every year. Although the food industry seems to be a prime target for thieves, being proactive in your security approaches will prevent you from being prey for highway pirates!

The author is Editor, AIB International.