COO and Co-Founder, Loadsure
Perspective: Knowing Cargo Theft Risks
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As shippers continue to contend with supply chain disruption, they’re simultaneously experiencing another risk: historic levels of cargo theft. As thieves get more brazen and creative, it’s important for everyone in the supply chain — shippers and carriers alike — to recognize the risks and know how to counter them.
In just the past year, 60% of retail small and midsized businesses have been rocked by a theft, according to software firm Capterra’s 2022 Cargo Theft & Reverse Logistics Survey.
In order to prevent cargo theft, it’s important for everyone in the industry to first know new tactics thieves are using, such as fictitious pickups, which we have seen coming through our automated claims system. For example, a gang recently responded to a reefer cargo post it found on a load board — using another carrier’s FMCSA MC number. The unscrupulous driver and dispatcher convinced the shipper that they worked for the company, and they were given the all-clear to pick up a load valued at more than $250,000.
From the shipper’s perspective, everything looked to be on the up-and-up. With load tracking functional, they kept a vigilant eye on their shipment as it traveled toward its destination — but then the truck continued on and alarm bells went off.
The shipper called the trucking company on its official phone number, and discovered that it had never dispatched a truck on their behalf. As this was happening, the criminals were disabling the tracking devices, and the trailer and load were never recovered.
Shippers and carriers also need to be careful about what information they’re providing about shipments. Valuable shipment details should be limited to a need-to-know basis. For example, labeling a shipment of gold, “gold,” could attract unwanted attention.
Of course some things never change, and thefts of tractor-trailers — particularly when left unattended — remain a risk. The simple fact is that cargo at rest is cargo at risk.
Past knowing the risks, we can all help to protect against theft.
For shippers, thoroughly vet your potential carrier partners via the FMCSA, web searches and third-party vetting services to protect against a fraudulent pickup. Check out your carrier partner’s cargo security philosophy and ensure they’re as committed to protecting your freight as you are. That includes everything from pre-hire background checks and cargo security devices to cybersecurity protocols and avoiding stops in cargo theft hot spots.
Meanwhile, carriers should have policies and procedures that they can share with clients and potential clients, which include background checks, dispatch and security, equipment tracking, check calls, out-of-route response and training. Carriers should also be prepared to be challenged by their shippers and 3PLs on these issues, and be ready to respond to concerns. Moreover, for shippers, avoid packaging labels that put a target on your load, and limit shipment details to those who truly need to know. Carriers should also be prepared to be challenged by their shippers and 3PLs on these issues.
Also, consult risk-management professionals for best practices insights, SOP support, and proper security procedure guidance — then hold your people accountable for following these procedures. And provide ongoing training to employees so they know how to spot suspicious activity and where to report it.
In addition, constantly invest in securing your warehouse and make sure your partners do the same for every step of the supply chain — locks, video cameras, and secure fencing can dissuade crime syndicates from labeling you an easy target.
It’s also good to consider ways to protect cargo before it even leaves. Shippers can protect their valuable loads with an all-risk shipper’s interest policy to address their risk exposure. Most carrier liability policies do not cover theft — especially fictitious pickups — so it’s important to be sure you have the proper coverage. Carriers should also avoid making themselves a target by having and using a secure TMS, routing and visibility software, proper paperwork security and management, and not discussing loads or clients with anyone who doesn’t “need to know.”
It’s a wild world out there — but a thoughtful approach to cargo theft prevention can help you navigate the journey safely.
Jim Heide is chief operating office and co-founder of Loadsure.
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