Who's doing your hauling?  How Identity Fraud fuels Cargo Theft

Industry research reveals that new trucking scams are growing 6%, quarter over quarter.  Of the average three to five truckloads stolen each day in the United States, at least one involves a fraudulent or fictitious pickup.  For its part, LoJack examined 947 cargo thefts last year and identified 45 of them as fictitious pickups, with an average loss of more than $170,000 per incident. 

Pain in numbers 

The trucking industry in the United States moves more than 68% of all domestic shipments, and so these cargo thefts hurt overall commerce, drive up insurance rates for companies, push up consumer prices, and potentially allow unsafe food and drugs to reach store shelves. 

The internet and online commodity tracking databases help fraudsters decide what type of commodity to target.  A few examples of individual but massive value cargo thefts: 

• 80,000 pounds of walnuts worth $300,000 in California 
• $200,000 of Muenster cheese in Wisconsin
• Rib-eye steaks valued at $82,000 in Texas 
• 25,000 pounds of king crab worth $400,000 in California 

Hughson Nut Co. of Livingston, CA fell victim twice in one year.  Each time, the impostor truckers showed up at the nut processor with seemingly all the proper paperwork and identifications and hauled away a load of almonds valued at $189,000. 

When food items fall outside the defined confines of a secure supply chain, receiving processors and retailers cannot risk the safety of the consuming public and so the food (if recovered at all) must be destroyed.  Similarly, stolen pharmaceuticals might require a global recall of every drug with that lot number to ensure none of the product finds its way into pharmacies in case it was tampered with. 

That said, stolen foodstuffs can wind up in the “gray / black market”, ultimately into small grocery stores.  But by no means are the overall illegal operations small – frequent federal raids find distribution warehouses filled with stolen steaks, shrimp, energy drinks, ice cream and other frozen foods. 

Food loads in particular are difficult to recover as this cargo category generally does not have any serial numbers to trace.  Further, companies don’t realize they have been scammed until their shipments fail to show up at their intended destination, usually four to five days after they were stolen.  By that time, the goods have probably already been sold and transferred to the black market. 

Overall, food and beverages are the most commonly stolen items, accounting for 23% of all thefts, followed by metals at 16%, and electronics and household goods at 12% each.  Other products made up the remaining 37%, including pharmaceuticals at 3%. 

For the past few years carriers reported nearly 1,200 cargo thefts (per year) of all kinds nationwide, but since many thefts go unreported, the actual figure is likely far higher. 

Know who you’re working with

The California Farm Bureau Federation as well as the greater trucking and insurance industries warns about clues that could indicate a suspicious hauler:  

• Temporary name placards 
• Temporary identification numbers on the truck 
• Abrupt changes in the time of the pickup 
• Lack of a GPS tracking systems 

But before all that, UVeritech recommends fundamental, proactive vetting of driver and tracking company information before awarding shipping contracts to unfamiliar truckers.  And always authenticate and document your driver’s identity to mitigate risk, and ultimate loss and downstream liability.