Trucking Engaged in Tech Arms Race Against Cargo Criminals
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The trucking industry has become embroiled in a technological arms race as the threat of cargo thefts rapidly rises and evolves.
Verisk Analytics’ CargoNet noted in a report Dec. 18 that there were more than 600 strategic cargo thefts dating to November 2022. That compared with an average of 58 strategic cargo thefts in previous years. Strategic thefts tend to be more sophisticated since they leverage technology such as load boards, as opposed to the more traditional straight thefts.
“Where we’ve seen the most increase in cargo theft is in the strategic cargo theft category,” said Scott Cornell, transportation lead, and crime and theft specialist at the insurance firm Travelers. “That strategic cargo theft area is where the thieves basically trick you into giving them the cargo.
“How are they doing that? They’re doing it by using technology. They’re using a lot of the same technology the industry has put in place to make itself more efficient.”
Cornell also has seen cargo thefts spread to regions where they have traditionally not occurred. Uber Freight confronts that problem by working with several regional law enforcement teams, but it has often found these teams to be underfunded.
“It’s this expansion of what tech and anonymity has brought into the marketplace,” said Chris McLoughlin, director of compliance at Uber Freight. “I think people early on, like with any kind of new technology or new kind of direction, were leveraging it to create efficiencies, to create improvements. Now it’s filtering on through down to the bad actors.”
McLoughlin views technology as a significant reason behind the increase in cargo thefts. He noted that stakeholders across the supply chain need to realize that frictionless is impossible because there need to be controls and processes that protect everyone.
“As far as technology playing a role in the actual act of the theft, I would say today more than ever before, that is probably more prevalent than just true hands-on old-school theft,” said Karl Fillhouer, vice president of sales at Circle Logistics. “I believe most of the increase from last year that we saw is due to a more high-tech kind of spoofing theft, where they’re getting in the middle of communications and they’re actually stealing load numbers and dispatching them.”
Fillhouer also pointed out that multiple technology services are available to prevent theft through verification and tracking. Cornell echoed that point by noting carriers, shippers and brokers are leveraging more outside technology around cargo security and tracking.
“Now we’re seeing the freight brokers get more involved in that because of the increases in strategic theft,” Cornell said. “They’re working closer with the shippers, closer with the trucking companies, and with some of these companies that provide the tracking technology. We’re seeing a lot of new tracking technology companies come to the market because of this.”
The load board and freight management company Truckstop launched a campaign last year aimed at fighting cargo thefts by leveraging its data to share information with industry players. It included a weekly web series called “Fraud Prevention Friday.”
“Our industry is beginning to revolutionize into data automation, and where there’s another wall that the bad guys can hide behind, and they can move at light speed because information transmits electronically at light speed, a lot more damage can be done,” said Brent Hutto, chief relationship officer at Truckstop. “There are also better ways to protect yourself.”
Truckstop has long vetted companies that come across its platform to detect irregularities that may indicate fraud or other issues. In the past 15 months, the company denied 10,000 people from creating accounts because they were either unqualified or fraudulent. Hutto stressed the importance of this security since many smaller players with less resources use it.
“Technology is probably the driving force behind the rapid rise in theft over the last few years, and it’s going to be part of the solution as well,” said Darin Miller, senior surveyor at technology-based risk management company Sedgwick. “They find the exploit in the supply chain, and they figure out how to utilize that to their advantage. Then the various parties within the supply chain all start scrambling to figure out how to shore that up.”
Miller took particular issue with how load boards operate. He equated them to unregulated online ads that criminals are able to easily exploit. He also pointed out that everything becoming expedited has sometimes caused verification processes to break down.
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“I can see companies buying technology, software, investing, so they can ensure that the product actually gets from dock to dock,” said Kevin Ledversis, vice president of sales at Newcastle Systems. “Obviously, those carriers are going to have to invest in technology, too.”
Ledversis added carriers have an incentive to invest since ultimately they will be dinged for lost or damaged cargo. He recommends keeping trucks moving to limit theft opportunities, and tagging pallets and boxes with a real-time location system.