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November 21, 2011 8:00 AM, EST

Opinion: Managing Cargo Security

By Jason Riha

President

TransRisk Solutions Ltd.

This Opinion piece appears in the Nov. 21 print edition of Transport Topics. Click here to subscribe today.

Cargo theft is on the rise, and, thanks to various reporting groups, we carriers, shippers and consignees are now able to track theft patterns and take steps to reduce our chances of being involved in such incidents.

In fact, in this space a column recently offered advice to smaller carriers on this important topic (“Small Firms Can Fight Cargo Theft” 9-19, p. 7). This essay is a variation on that theme, expanding to include carriers of all sizes and offering more cost-effective suggestions for protecting cargo, including steps shippers can take.

It’s unfortunate that this information is necessary, but the sad fact is that, while organized cargo theft groups are starting to gain considerable attention from potential victims, security firms and law enforcement, it doesn’t seem to be slowing them down. Instead, these groups continue to adapt to our methods of preventing their attacks — and they are proving to be more intelligent and organized than many have given them credit for.

And with a continuing sluggish economy and high unemployment rate, it’s highly likely, even inevitable, that cargo theft will increase.

The question now is how many of us will be prepared to protect our assets, and how many will be satisfied simply to hope nothing bad happens and react only if it does — when it may be too late.

Consider these alarming statistics recently released by FreightWatch International, a logistics security firm:

• 899 cargo theft incidents were recorded in 2010, compared with “only” 310 such incidents in 2006.

• In 2010, 45 multi-trailer incidents were recorded — the first time double-digit thefts of this type had been recorded in a single year.

• FreightWatch recorded 263 cargo-theft incidents from July to September 2011, with 73 thefts recorded in July, 110 in August and 80 in September.

• There was an average of 87.6 thefts per month between July and September 2011, and the year-to-date monthly average thefts per month is 76.2.

• There were five thefts in excess of $1 million between July and September of 2011.

• Food and drink (21%), electronics (18%) and building/

industrial (15%) were the most-targeted product types between July and September 2011.

Criminals increasingly are acquiring cargo from secured locations, as many shippers and carriers have hardened their facilities, leaving fewer unsecured targets available to the bad guys.

Another recent trend involves theft groups impersonating trucking companies — complete with decaled equipment and uniformed drivers — and being dispatched with trailers full of merchandise that never reaches its destination.

In my experience, carriers of all sizes tend to shy away from improving their security measures because they incorrectly assume that (a) “It’ll never happen to us” and (b) “We don’t have the money to spend on expensive security products and consultants.”

In reality, the majority of cargo theft risk can be proactively prevented with little cost by simply improving policies and procedures along with consistent and effective management follow-up.

The Sept. 19 Opinion column aimed at small carriers made an excellent start on that, but here are additional cost-effective measures to make it more difficult for the bad guys.

Beginning with the cargo itself, we would advise:

• Using GPS tracking on tractors and trailers (separately) whenever possible, with geofencing features used around the expected area of travel.

• Routinely planting specialty GPS units in individual cartons or materials to be used in the event the GPS on the tractor and/or trailer is compromised.

• Putting heavy-duty locks on high-value cargo loads.

• Considering subscribing to a cargo-theft intelligence network that will tell carriers which regions to absolutely avoid traveling through with high-value cargo.

• Training shipper associates to verify the identity of anyone to whom they release cargo prior to that release. In fact, requiring specific carrier IDs that cannot be duplicated is a very good way to go, as well as requiring the carrier to notify you ahead of time as to the equipment type, license plates and the name of the driver they will be sending to pick up the cargo.

• Considering the use of closed-circuit television to record all equipment that enters and exits the property, using a setup that can read license plates. That record will be very helpful in the event an incident occurs.

As the Sept. 19 Opinion covering small carriers pointed out, driver training also is vital. In addition to what that column suggested, we would advise:

• Training drivers never to stop between the shipper and consignee unless absolutely necessary.

• If the load must be stopped, the driver should be trained to make every effort not to do so within 250 miles of the shipper’s location.

• Also, if the load must be stopped, train the driver always to turn off the truck engine, roll up the windows, lock both doors of the cab, and verify that tractor and trailer both are secured when he or she is away from the vehicle — no matter how short of a time that vehicle will be unattended.

• Telling the driver to check in with route planners several times during a trip — but only while parked in a safe location, of course.

• Telling the driver to change routes occasionally in case a potential thief is watching for patterns and weaknesses.

• Telling the driver to be conscious of other vehicles in order to determine if the truck is being followed.

• Telling the driver never, ever to share confidential information such as load contents, pricing or the identity of customers being serviced.

While this is far from an all inclusive list of solutions, I hope it is helpful.

TransRisk Solutions, Oak Forest, Ill., provides commercial risk-management services, specializing in transportation and warehousing, in the upper Midwest.