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Moving Targets: With the Supply Chain in Focus, Can Preventing Cargo Theft Gain Traction?

On the too-rare occasions when store theft receives attention commensurate with the problem, it’s often because of a dramatic spike in crime accompanied by must-see visuals. This past holiday season was a case in point, with surveillance footage of flash mobs smashing their way through stores sparking both public outrage and mainstream discussions about what society should do about it. It even gave a push to the INFORM Act, proposed legislation to combat rampant organized retail crime (ORC), which became part of some accompanying conversations once disturbing images had enticed eyeballs. Cargo crime is a ghost by comparison.Video footage is rare, and thefts occur out of view—think railyards, truck stops, and distribution centers—so it’s harder to take it as an affront. It’s often not entirely clear who is being victimized, which surely limits sympathy and interest in cargo theft—and it’s hard to overstate the importance of sentiment in shaping policing and prosecutorial priorities.

Lack of awareness and attention frustrates some who work daily to protect goods in transit, like one veteran supply chain investigator for a national retailer. He reported that he’s “seen a major spike in theft within our industry impacting multiple retailers,” and decried the lack of appreciation for “the massive amounts of theft that occur every day out of the public eye.”

Sgt. Jose Covarrubia of the Los Angeles Police Department (LAPD) notes the same misalignment. “Smash-and-grabs have gotten people’s attention, but I can tell you the cargo theft activity is way, way worse,” he told LP Magazine.

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Attention can cut both ways, of course. The wrong kind can entice copycats. But retailers could surely benefit from greater stakeholder scrutiny—to raise the issue’s profile, spark conversations with transportation partners, direct lawmakers’ attention, and command resources. It’s a necessary precursor for prevention because preventing cargo theft—like ORC—requires good team defense.

The value of law enforcement support is evidenced in the most recent data on cargo theft. As reported by CargoNet, a cargo theft data‑sharing network, the Northeast saw a sharp drop in cargo theft of 74 percent year‑over-year, which its analysts credited to an enforcement action against an interstate trailer burglary group that frequented truck stops on the I-81 corridor in Pennsylvania. That a single enforcement action moved the needle on quarterly statistics suggests that the power exists to curb cargo theft—when the will, resources, and communication channels align.

A Rare Spotlight

It started with the pandemic and has grown since—the supply chain has become the industry’s focus and part of the national conversation. There is hope among some who fight cargo theft that with talk about issues like driver shortages, packed warehouses, and port logjams, more light may shine on the related problem of supply chain theft and, potentially, catalyze greater accountability for those who commit it.

Scott Cornell
Scott Cornell

“There has been greater awareness about the supply chain, which can bring awareness to supply chain theft,” said Scott Cornell, transportation lead and crime and theft specialist at Travelers. “And anytime you raise awareness it can bring more resources.”

There is even video to sell the story. Police in Pamona, California, reported in November they had discovered $100,000 worth of retail packages strewn along Union Pacific rail lines and stashed in nearby homeless encampments—along with countless empty boxes. Among the items were brand new vehicle tires, small kitchen appliances, auto parts, and clothing. Area police say the thieves break into containers as mile-long train cars sit idle waiting for tracks to clear, and that cargo trains are hit on a weekly basis.

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Local news stations deployed aerial vehicles to document thieves in action, shooting footage of them jumping on trains armed with bolt cutters, leaving container doors wide open, and tossing as much off trains as they could grab. Nearly every time they checked a particularly high-risk stretch of track, largely hidden from view, NBC4 said they caught thieves in action, communicating with whistles to alert one another they were being watched. When Los Angeles County Sheriff Alex Villanueva was shown video by a local news reporter his reactions were telling: “Wow,” he said, “holy moly,” and, more worrisome, “This is new to me.”

He also promised, “We’re going to put someone on that,” and it does seem to have sparked action. The LAPD hosted meetings in November and December to provide updates on investigations and forge a coalition of law enforcement, retailers, major manufacturers, and rail and road transportation representatives.

To sustain momentum and improve enforcement, more resources are going to be needed, according to one law enforcement representative. “We’re trying to do our part to curb it. It’s obviously a big problem, but it requires having the available resources because it goes along with everything else that we’re trying to address,” he said.

Sgt. Covarrubia has focused on cargo theft for nine years, and while there is nothing novel about what is going on currently, he says the scale has changed, set in motion by force reductions in the number of officers protecting rail lines. “When those numbers were cut, there was no longer an ability to cover the area with a physical presence or respond to incidents, which dramatically impacts how you can handle the problem,” he said.

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A vicious cycle ensued. People got away with it, emboldening more people to do it. “The last couple of years I’ve really seen it grow,” said Sgt. Covarrubia. “It has gotten to the point now where they’re popping locks and just clearing out the containers, and once they get what they want, local transients clear out what’s left.”

Los Angeles has seen three murders directly related to cargo theft, and the criminal gangs behind thefts in Southern California—and the violent turf wars they’re engaged in—have pushed law enforcement to reach out to the private sector for help, said retail coalition members. “It’s more complicated than an addict walking into a railyard looking to steal. It’s highly organized crime groups that may not even be from the area, coming to exploit a vulnerability,” one explained.

Retailers in the LA coalition are trying to help secure money from the Department of Homeland Security to combat the problem. “We’re working with law enforcement to draft grants to get law enforcement assigned to cargo security,” explained a supply chain security manager from a national consumer goods company, including providing statistics that should provide strong ammunition in the fight for funding. Third-quarter data from CargoNet (see below) shows theft along the US West Coast grew 42 percent year-over-year, in part due to frequent thefts of high-end computer electronic shipments in Southern California.

Concentration of cargo theft in select geographic locations adds credibility to the idea that strong partnerships can make a real difference, especially if they are agile and fast to react to developing threats. When cargo theft gangs become active around specific major transportation nodes, disrupting activity in those areas can materially impact cargo theft overall.

Max Leitschuh

Speaking to the current threat environment, Max Leitschuh, senior transportation analyst at Crisis24, agreed that the threat is manageable when all sides are attacking the problem. “Exposure can be mitigated by effective security and police measures against cargo theft,” he told LP Magazine.

Tom Morgan

Prosecutors and legislators are also good to have on board, suggested Tom Morgan, a professor at Middle Tennessee State University with a PhD in Logistics Systems. He told LP Magazine that current disruptions are likely due in part to organized multi-person theft and the lessening deterrent of getting caught.

Sgt. Michael Gibbs with the Memphis, Tennessee, Police Department’s cargo theft task force, explained both the challenge and imperative of addressing cargo theft as a public safety issue. “With everything going on, property crime tends to take a backseat, but one thing I’ve always seen is that property crime helps fuel violent crime, because it provides them money that they use to buy the guns and drugs.”

One retail representative said he’s encouraged by burgeoning partnerships in Southern California. It’s still in the goal-defining stage, and he thinks it will take at least six months to realize benefits, but he believes it could pay dividends for the retailers that are losing millions of dollars in the rail line attacks. “Bridging that gap between public and private is a huge step forward,” he said. “They have a lot of tools we don’t have, and we can do things they can’t, so we can do things to assist one another.”

In cities where law enforcement still has a dedicated cargo theft task force, police-private sector cooperation is typically excellent and valuable as a source for information exchange, data sharing, and joint training and sting operations, according to Travelers’ Scott Cornell. He’s been focused on cargo theft for twenty-five years and said these strong partnerships have been—and continue to be—instrumental in controlling cargo theft.

Bumpy Roads Ahead?

Labor shortages have caused massive disruptions to global cargo transportation, especially to containerized cargo transport as ships wait to unload. In the US and Europe, ships have had to endure lengthy delays offshore causing cascading delays to shipping schedules around the world. And, as the saying goes, “Freight at rest is freight at risk.”

Leitschuh draws a line between the backlog at the ports of Los Angeles and Long Beach, with Union Pacific rail lines service, and the rise in thefts at and around America’s two largest ports. “The supply chain disruptions have led to containers and other cargoes sitting at ports, warehouses, and other locations for longer, which increases their exposure to potential thefts,” Leitschuh told LP Magazine.

And, with warehouses full to overflowing, cargo has been forced to sit in trucks or less secure secondary spaces, according to Cornell. “Add to that the shortages [increasing product demand], and you’ve created the perfect storm.”

Sgt. Gibbs says he’s seeing supply chain kinks play out in the Mid-South region with devastating effect, including an “explosion” in rail theft as trains with full containers sit idle for days along stretches of remote track that police don’t have the resources to monitor. It typically starts with three or four thieves who “shop the containers” until they find what they want—big screen TVs have been hot lately—and then message others. “This whole mob mentality is something we’ve never seen before in the Mid-South, with thirty people jumping on trains at one time,” he said. “They line up waiting to steal from trains like a line at Chick-fil-A.”

Supply chain flow is thus an important risk factor, and there is no certainty when the current disarray will end. “Ongoing disruptions will likely continue through at least the first half of 2022,” according to Crisis24’s 2022 Global Risk Forecast, with the pandemic acting as a primary wildcard.

The products targeted by cargo thieves in the third quarter of 2021 were familiar, with a few fluctuations. Computer electronics shipments were targeted more often, and household product theft dipped slightly. The geographic areas hit in Q3 were also common, with California, Texas, and Florida accounting for more than half of theft events identified by CargoNet. Theft dipped modestly in the middle of the country, but that was in comparison to a record-setting year for cargo theft in 2020, the group said.

Looking ahead, analysts said they’re concerned about the targeting of computer electronic shipments from California, as well as the potential breakout of full truckload cargo thefts spreading across the eastern half of the US.

If cargo resumes its normal flow, Cornell says he can see food and beverage returning to its position as the most stolen category of cargo, but if another commodity falls into short supply, he expects that to take center stage. “The golden rule is that cargo thieves steal what they know they can sell and what people want and need,” and so the targets of cargo thieves evolve in concert with consumer demand.

Battling Back

A 22-year veteran, LAPD Sgt. Jose Covarrubia says it’s disheartening to see a rise in a problem he’s been fighting for years. Sgt. Gibbs is equally worried in Memphis, with increases in all manner of cargo theft, mob-fueled attacks, and greater violence. He’s been on a cargo task force for six years, but 2021 is the first in which he’s seen truck drivers being robbed at gunpoint.

LP pros who work on cargo theft and law enforcement alike identified cooperation as key to making inroads against the problem. Businesses must come forward when they’ve been victimized, said Covarrubia, and partnerships must continue to be strong. As cargo thieves increasingly join forces and cooperate, good guys must come together as well.

Along with cooperation, communication is critical, said Cornell. The supply chain is all about hand-offs between different entities—from manufacturers to freight brokers and so on—and the quality of the communication between links in the chain is foundational to secure transport. “Sometimes that happens well and sometimes not so well,” he said.

Cornell helps Travelers’ clients with a three-layer approach to protect moving targets.

  • Awareness, education, and good processes and procedures, such as having drivers fueled up and rested when picking up loads so they can drive a good distance (200 to 250 miles) right after loading to get out of the “red zone” where cargo thieves like to hit. “Thieves don’t want to work harder than they have to,” he said.
  • Good hard-locking devices.
  • Covert tracking capabilities in loads to help with recovery if a theft does occur.

Other Recommendations from the Experts

Improve Information Control. “Information is the key to slowing supply chain theft,” according to Morgan, who offered the following best practices—safeguard information that potential thieves may use to gain access to goods; limit knowledge of inventory locations and quantities to those who require it; and improve precise monitoring of inventory or asset location, such as with RFID tracking, Bluetooth low energy (BLE) tracking, and IP address tracking.

Leverage Political Power. Sgt. Covarrubia is reluctant to turn cargo theft into a political issue, but he believes certain truths are inescapable, specifically that no-cash bail, lack of prosecutions, cuts to police funding, and light sentences are all contributing to greater cargo theft in his region. Both he and Sgt. Gibbs encouraged retailers to use the sway they possess to change laws and better deter cargo thieves. “There are minimal consequences if they get caught. So why would they stop? I see people with no history committing these thefts because they’re seeing their friends doing it and making money,” said Sgt. Gibbs. “The private sector is very powerful, and I encourage them to be vocal with legislators, or it will continue to be a slap on the wrist.”

Stay Current with Trends. From available cargo theft information networks, stakeholders can learn about threat trends and current hotspots. A map of truck pilferage in Memphis, with pins clustered in certain stretches of road, makes the point. By way of example, “If a truck parks on Lamar Avenue, it will get broken into,” said Gibbs. “The biggest thing is that retailers don’t understand the importance of that very first incident, because if a suspect is successful, they will come back, and they will tell others.”

Upgrade Security. Higher quality cameras are the difference between making arrests and simply watching clips of unidentifiable thieves in action, said Sgt. Gibbs, adding that good fencing is a helpful deterrent, and tracking devices aid investigations. “I understand every business has a budget, but my history of doing cargo theft is that when people are willing to pay a one-time fee to get security measures in place, they deter a lot of crime going forward.”

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