Prevent Cargo Theft Due to Fraud

Cargo theft is a growing problem in the supply chain industry. While cargo theft may occur at a stop en route where the load is temporarily unattended, load thieves are increasingly sophisticated. In this article, we'll discuss how thieves can use fraud to steal freight. We'll also discuss how to prevent cargo theft and what to do if you become a victim.

Basic Cargo Theft Strategy

First, a new carrier will contact a broker to take on a load. The carrier then fills out the paperwork to be listed with the broker and sends a driver to pick up the load. The driver then leaves with the load and subsequently disappears.

Upon investigation, the carrier and the paperwork is found to be fraudulent. This is an incredibly simple strategy, but it works.

Delaying Report of Cargo Theft

In addition to the basic theft strategy, many thieves use strategies to prevent cargo theft from being quickly reported. For example, it is more common for thefts to occur on Fridays or weekends, because this may delay reporting and investigation.

In another strategy, a carrier may pick up a load and claim that delivery has been delayed. They then keep in touch with the broker/consignee/shipper for a few days before cutting off contact. Thus, the theft isn't reported until several days after the theft occurred.

Prevent Cargo Theft

Fortunately, there are several proactive steps you can take to prevent cargo theft, at least, to protect yourself in the event that it does happen.

  • Take care in verifying the identity of all carriers. Carefully review and verify all paperwork.
  • Collect as much information as you can about your carriers and drivers, such as
    • Photocopies of drivers' licenses
    • Video footage of the truck being loaded
    • Tractor & trailer make, model, year, & color
    • Tractor & trailer VIN
    • Trailer & trailer license plate number
    • Carry your own insurance, and understand what your insurance policy does and does not cover. A fraudulent carrier's insurance company won't pay a claim when their client provided fraudulent information, so ensure that your own insurance will protect you.

Reacting to Theft

After the theft has happened, take these steps to increase the odds of recovery:

  • Act quickly. The faster you notify authorities, the more likely they will be to catch the thief and recover your cargo.
  • Follow up with police often. Be persistent in order to keep your case from dropping from their priority list.
  • Consider hiring a private investigator to  track down the freight.
  • Keep all documents and evidence organized in case they are needed for court.
  • Contact any relevant federal agencies, depending on what was stolen. For example:
    • Dangerous cargo or hazardous products - contact the FBI
    • Food - contact the department of agriculture

Following these steps will help you prevent cargo theft and minimize the loss to your company. For more information, see our source, TIA's excellent 54 page piece on fraud in the supply chain.