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Report Says Thefts Rising, But Fleets Question Data
Monday, 08 February 2010 00:00

Cargo theft increased sharply in 2009, according to an international insurer and a security firm, although two major carriers said they had experienced a drop in losses from theft and American Trucking Associations said good statistics were hard to come by.

“From an overall perspective, taking in all the intelligence and feedback we’ve received, there definitely has been an increase in cargo thefts in 2009,” Scott Cornell, national program manager, Travelers Specialty Investigations Group, told Transport Topics.

FreightWatch International, a private international security company, announced Jan. 29 that last year it had “recorded an average of 72 cargo theft incidents per month, 859 cargo theft incidents total, a 12% increase from 2008 . . . This is the most ever recorded.”

However, UPS spokeswoman Susan Rosenberg said of the FreightWatch report, “Our folks were scratching their heads because the trends are favorable for us.”

“We’re trending down both in dollar value and the number of incidents of cargo theft,” she told TT. “This is comprehensive across all divisions of UPS.”

Walt Fountain, director of loss prevention and enterprise security for Schneider National Inc., said that, while he agreed with FreightWatch’s overall view that cargo theft is rising in the industry as a whole, Schneider has enacted procedures throughout its supply chain that cut its cargo theft losses by 76% from 2008.

Travelers’ Cornell said theft has spread “beyond its traditional centers of New Jersey, Miami and Southern California. Texas is being brutally hit by cargo theft . . . and in states like Ohio and Illinois, where it was previously just a minor problem; we’re seeing a big increase.”

The FreightWatch report said the incidents were primarily nonviolent, full-truckload thefts but also included 36 warehouse burglaries and 13 hijackings.

“By volume, the electronics industry suffered the highest number of cargo theft incidents, going from 174 theft incidents in 2008 to 196 in 2009 and accounting for 23% of all cargo theft,” the report said.

Dan Burges, director of consultancy and intelligence for FreightWatch, told TT that sources for the report included cargo theft task forces; law enforcement sources; private investigation firms; several transportation security councils; industry personnel such as transportation providers, freight forwarders and shippers; insurance companies, clients and partners; FreightWatch’s field staff and news media reports.

The report said that although pharmaceuticals made up only 5% of all cargo theft last year, the average pharmaceutical theft was valued at $2.5 million. In fact, the report said a single $37 million pharmaceutical theft in Pennsylvania had not been included because it would have skewed the average.

The average electronics loss was $814,000, FreightWatch said, although subcategories such as cell phones had significantly higher values.

Truck stops remained the prime location for thefts, typically occurring when the driver leaves the load to pay for fuel, eat or rest.

The FreightWatch study found “a noticeable increase in the number of cargo theft incidents occurring at terminal and distribution center lots, as well as trailer drop lots,” in the second half of 2009.

Schneider’s Fountain told TT, “The threat continues to evolve. . . . We can get an indication of where the threat may be headed and create countermeasures to defeat them before it costs us money.”

He said evidence exists that gangs have sabotaged trains to halt them and get at the cargo, often in trailers or containers.

“Two or three trailers are the max that one of these groups can get,” Fountain said. “If they go after a train, the gangs don’t have the infrastructure to steal the contents from 40 containers.”

The loss of four or five trailers at an average value of $500,000 “is a significant loss,” he said. “It causes a large disruption in the supply chain.”

A spokesman for American Trucking Associations told TT it was difficult to gather hard statistics on cargo theft, especially without any federal oversight.

And although the FBI said it would begin collecting statistics, “We don’t collect any data presently on cargo theft,” FBI spokeswoman Denise Ballew told TT.

“However, cargo theft recently became a uniform crime category, but it hasn’t rolled out to law authorities completely,” Ballew said. “It could be a year of two before we collect enough statistics” to put out a report.

Transport Topics, 2/8/2010