Why Cargo Theft is Surging and How to Protect Your Supply Chain

As peak season approaches, vigilance will be key in ensuring that holiday cheer doesn’t turn into a windfall for cargo thieves.

Andrii Lysenko Adobe Stock 643681659
Andrii Lysenko AdobeStock_643681659

As retailers gear up for the busiest shopping period of the year, an already record-breaking surge in cargo theft threatens to cast a shadow over the upcoming holiday season. With Black Friday and Cyber Monday looming on the horizon, cargo thieves are poised to cash in on the increased volume of high-value shipments crisscrossing the country.

The first half of 2024 recorded a 49% surge in cargo thefts compared to the same period in 2023. This increase isn’t just about frequency — the average loss per incident has skyrocketed to $115,230, an 83% jump from the previous year. As we enter the peak retail season, these numbers are likely to climb even higher, potentially setting new records for cargo theft losses.

In Chicago, a recent rail theft extended beyond organized criminal activity and included bystanders, who joined in for a flash mob-style pilferage. This incident, which ended with six arrests, shows just how brazen thieves have become. Chicago was already a hotspot for rail pilferage, and the region is getting even worse.

Several factors are fueling this perfect storm of criminal activity. In the wake of the pandemic, there’s been a notable shift in the criminal landscape. News stories about seemingly unstoppable cargo thefts have attracted a new breed of thieves, many of whom have spent the last few years honing their craft. What used to be 1-2 guys in a sedan is now a sophisticated operation of crews rolling 12 deep, equipped with multiple box trucks and an arsenal of tools to crack open trailers and containers.

Simultaneously, the rapid adoption of technology in the logistics industry has created new vulnerabilities. While meant to enhance efficiency, these technological advances have outpaced the industry’s ability to secure them properly. This is especially true for independent operators who lack robust IT support and aren’t receiving regular cybersecurity training. As a result, when tech-savvy criminals come knocking, many drivers find themselves ill-equipped to fend off these increasingly sophisticated attacks.

As we approach the holiday shopping season, understanding cargo theft’s evolution is crucial. The industry must brace for potentially escalating theft attempts and adapt quickly to protect the billions of dollars worth of goods that will be in transit. The coming months will test the resilience of supply chain security measures and the industry’s ability to stay one step ahead of increasingly sophisticated criminal operations.

From hijacking to hacking

Cargo theft has undergone a dramatic transformation in recent years. While the traditional full-truckload theft still accounts for a significant portion of incidents (34% in the first half of 2024), there’s a shift toward more sophisticated and tech-savvy methods.

One of the most alarming trends is the rise of strategic theft. Unlike traditional methods that might take a crew of six people up to a week to steal a single load, strategic theft allows criminals to pilfer dozens of loads in a single day without ever physically touching the cargo.

It typically starts with criminals creating or purchasing a fraudulent carrier or broker business, sometimes even buying an existing company with an established reputation. They then broker out loads to legitimate carriers who unknowingly become part of the scheme. Drivers are often given “blind loads” — a common but insecure industry practice where the final destination isn’t disclosed upfront. The cargo is then redirected, often with new paperwork that effectively launders the freight, masking its true origin, owner, and destination.

This method is particularly insidious because it exploits the trust and common practices within the industry. It’s not just about brute force anymore — there’s a network of bad actor carriers manipulating the system from within.

The evolution of cargo theft methods reflects a broader trend of criminals becoming more organized, tech-savvy, and strategic in their approach. As the industry grapples with a new era of sophistication, it’s clear that traditional security measures alone are no longer sufficient. The fight against cargo theft now requires a combination of technological solutions, improved industry practices, and heightened awareness at every level of the supply chain.

How to fight back

Advanced tracking and monitoring solutions are the new table stakes for fighting cargo theft. Gone are the days when a simple GPS tracker on a truck was enough. Today’s systems employ a multi-layered approach, with sensors and trackers on the truck, trailer, and even individual high-value items within a shipment. These systems provide real-time data on location, temperature, and even whether a trailer door has been opened unexpectedly.

But it’s not just about collecting data — it’s about analyzing it in real-time to identify potential threats. Machine learning algorithms can now detect suspicious patterns, such as unexpected route deviations or unauthorized stops, and alert security teams immediately. This early warning system can make the difference between a successful theft and a thwarted attempt. It recently helped identify a single container on a near-mile-long train in Indiana, leading to a rare instance of recovering stolen rail cargo.

While technology plays a crucial role in combating cargo theft, it’s not a silver bullet.

Improving driver awareness and education remains a critical component in the fight against cargo theft. Many drivers, especially independent owner-operators, are on the front lines but often lack the training to recognize and respond to potential threats. Industry leaders are pushing for more comprehensive education programs that cover not just safe driving practices but also cybersecurity basics, recognizing signs of potential theft attempts, and proper protocols for dealing with and reporting suspicious activities.

Enhancing reporting mechanisms and data sharing is another crucial area for improvement. One of the biggest challenges in combating cargo theft is the lack of comprehensive, timely data. Many thefts go unreported or are reported too late to help recovery efforts. There’s a growing push for standardized, industry-wide reporting systems that would allow for quicker dissemination of theft information. Increased data sharing between companies, industry associations, and law enforcement agencies could help identify patterns and hotspots more quickly.

The rise of strategic theft highlights the need for more robust verification processes for carriers and drivers. This includes thorough vetting of new carriers, implementing multi-factor authentication for digital platforms, regular audits of existing carriers, and training shipping facility staff to spot red flags.

The battle against cargo theft is far from over, but with increased awareness, improved practices, and innovative solutions, the industry can be better equipped than ever to protect the vital supply chains that keep our economy moving. As peak season approaches, vigilance will be key in ensuring that holiday cheer doesn’t turn into a windfall for cargo thieves.

 

 

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