The million-dollar load of pharmaceuticals stolen overnight from a parking lot, or a trailer full of frozen meat hijacked at gunpoint makes great headlines and news stories. But the truth is the biggest losses from freight security come from far more mundane — and increasingly common — problems.
As fleets have adopted better hardware and surveillance techniques to protect cargo under their care, the bad guys have also moved on to new strategies, shifting to fraud and identity theft as low-risk, high-profit enterprises. Even more costly to a fleet than the actual value of any lost cargo, these newly popular trucking crimes undermine trust between carriers, brokers and shippers, making everyone wary of potential new business partners and sources of revenue
The most publicized crimes have involved setting up dummy trucking companies that at least on paper appear to be legitimate carriers with the proper registration and insurance documents. Trolling load boards, they wait for a high-value cargo, take the load and disappear. Early this year, 25,000 lbs. of king crab valued at $400,000 was stolen from a shipper in Los Angeles using a fraudulent fleet apparently created just for such a score. And this spring, a similar setup in Florida was able to pick up six trailer loads of tomatoes before the broker realized none of them were being delivered.
While the bogus trucking company is a relatively new twist requiring significant planning and organization, fictitious pickups have been around for a while, a form of identity theft. This simpler technique involves getting a hold of the paperwork for a pickup and arriving at the shipper early, posing as the legitimate carrier. Perhaps made easier by the proliferation of electronically transmitted documents, this older type of cargo fraud is also on the rise again.
And not to be overlooked, there’s the issue of fraudulent brokerage, whether it’s carriers without the proper authority “double-brokering” loads to other carriers or out-and-out scam artists posing as legitimate brokers and disappearing without paying carriers for loads delivered.
At all levels, trucking is a relationship-driven business, but that’s especially important when it comes to carrying someone else’s freight. Electronic data makes it easier for a fleet to uncover new opportunities, especially in the increasingly lucrative spot markets. But an escalation in cargo fraud of all types makes shippers especially wary of any new party offering their services. For most fleets, the threat of cargo fraud is potentially more damaging than the rare case of actual cargo theft. Keeping thieves away from freight is relatively easy — a harder lock or a higher fence is often all that’s needed. But convincing new customers that you’re who you say you are and will do what you say you will is a much tougher challenge, one that will require attention to every aspect of your operation.
Establish a security plan that works in your business, that doesn’t interfere with your daily operations. The plan usually starts with fleet policies and procedures, then moves on to specific anti-theft devices like locking and tracking systems. Visit and evaluate every yard and lot where equipment is kept, determining the appropriate use of guards, fencing, camera surveillance and so on. Institute a no-stop rule, requiring contractors to be ready to go when they pick up a container and to drive at least 250 mi. before making their first stop. Investigators have found that deters criminals who follow a truck from its pickup and swoop in when it stops at a rest area. Begin educating contractors and agents alike on identity theft and the need to protect documents and confidential information. Finally establish business networking, sending along any periodic warnings and advisories.
If a theft does happen make sure you’re covered, it is critically important to have proper cargo insurance coverage. Many businesses have made the mistake of not having enough coverage or overlooking the specifics of their cargo insurance contracts. Either of these can be disastrous to your profitability and long term existence. If you are looking for cargo insurance quotes,
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