cargo theft rises in 2008, reflecting downturn

Cargo theft was a problem even in stable economic times. So it may not be surprising that as the economic downturn gathered speed in 2008, so apparently did the incidence of theft.

The number of incidents involving the theft of full truckloads climbed 13 percent over 2007 levels, according to data from Austin, Texasbased logistics security specialist FreightWatch International (USA). Most incidents occurred within 200 miles of the shipment's origin and came from stealing unattended vehicles, the firm reported. Hijackings or armed robberies accounted for only 3 percent of the incidents, the firm said.

What's being stolen? In perhaps another reflection of the downturn's severity, foodstuffs and pharmaceuticals were the most common commodities pilfered in 2008. LoJack Supply Chain Integrity, a unit of the auto recovery pioneer LoJack, conducted a survey of 1,500 professionals representing 600 organizations across the supply chain. Of the 353 incidents reported by the respondents in 2008, 13 percent represented theft of foodstuffs. That was followed by pharmaceuticals and building supplies, each at 12 percent. By contrast, nonstaple items like music, movies, and software accounted for only 1 percent of the thefts, the respondents reported.

Texas led the list of states with the highest cargo theft rates, with 68 incidents. It was followed by Georgia with 53; then Tennessee with 18; and California and Florida, each with 16. Truck stops were the most common location for theft, according to respondents to the LoJack survey, while Saturdays and Sundays were the most likely days for theft to occur.

FreightWatch said the targeting of U.S. pharmaceutical shipments occurred on an "unprecedented scale" in 2008, with 44 incidents reported, mostly in regions with clusters of drug manufacturing and distribution facilities. "This type of pharmaceutical targeting has not been seen at this level in previous years and has not been seen in any other country," the report concluded.

Barry Brandman, CEO of investigation, loss prevention, and supply chain security consultants Danbee Investigations Inc. of Midland Park, N.J., cautions against reading too much into public data on cargo theft. Many databases contain inaccurate or incomplete data, and companies are often loath to participate for fear that disclosing information on theft incidents will tarnish their reputation and risk client defections, he says. Based on a combination of empirical and anecdotal evidence, however, Brandman believes the current downturn is pushing cargo theft to unusually high levels. "Incidents always rise during times of economic softness. But this time is different," he says.

Brandman says he is seeing more theft of such consumer staples as toothpaste, as well as socalled "secondtier" foodstuffs rather than topline items like meat, poultry, and seafood. The large number of managerial and supervisory layoffs has worsened the problem, he says, because they have removed a critical layer of staff tasked with monitoring worker behavior in warehouses and distribution centers as well as out on the road.

Brandman expects the problem to persist even when the economy revives. Employees involved in theft rings pocket hundreds, even thousands, of dollars a week in underthetable cash to supplement their reportable income, and soon adjust to a more lavish lifestyle that they become reluctant to give up. "Once you get accustomed to getting that kind of money,"he says, "it becomes more addictive than heroin."