Perspective: Using Technology to Protect Cargo From Theft
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Cargo theft is often a subtle process, making it difficult to prevent. Rather than making off with the goods while the truck is out on delivery, thieves prefer to act when the merchandise is changing hands — typically at distribution centers and warehouses. Numerous factors contribute to this preference.
First, these facilities tend to be bustling with activity, with employees, logistics companies personnel and third-party collaborators constantly moving substantial volumes of goods in and out. During this commotion, security sometimes takes a back seat to expediency.
Second, 21% of cargo theft incidents involve insider participation, according to the 2022 Cargo Theft Report from TT Club, the Transported Asset Protection Association and BSI Connect Screen Intelligence. Because employees at distribution centers and warehouses have access to a large inventory of items, they become prime targets for bribery and collusion.
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Third, thieves have learned that the most lucrative way of stealing cargo is to pose as legitimate brokers or carriers to execute a “fictitious pickup.” This so-called strategic theft, which has risen by 700% over the past two years according to CargoNet, entails targeting particular inventories stored in logistics hubs.
Matarazzo
With cargo thieves relying increasingly on subterfuge, the security apparatus on the shop floor must evolve accordingly. Mechanical locks and surveillance cameras are no longer sufficient when perpetrators can pass as associates or even colleagues.
Stopping thieves disguised as staff from escaping with stolen goods — especially when they have received insider assistance — is difficult. But limiting their escape is possible. Therefore, the focus of deploying technology to combat cargo theft in distribution centers and warehouses should be about deterrence rather than prevention.
Asset-tracking solutions can be helpful. Even in the event of employee complicity or a fraudulent pickup, shippers can monitor in real time if cargo deviates from its intended route. This enables them to promptly notify law enforcement and security personnel to recover the goods.
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Data about the location and movement of the vehicle and cargo can be collected continuously by GPS trackers and RFID tags, respectively. The data can then be transmitted to a blockchain network, where it undergoes encryption. The blockchain network acts as tamper-proof documentation of the cargo’s journey. This is crucial, as it prevents malicious actors from altering data to hide fictitious pickups or cargo diversions.
This documentation can be distributed to every participant within the blockchain network, including shippers, carriers and third-party logistics companies. Data cross-verification ensures unanimous agreement regarding the legitimacy of pickups and deliveries.
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Further, any irregularity in the cargo’s route or condition is immediately detected and flagged on the blockchain, triggering alerts to all network participants. Because everyone can see the same information on the blockchain, concealing deceptive activities becomes more difficult. If potential cargo thieves realize that their illicit activities can be tracked and their movements followed, they may be discouraged from engaging in the first place.
CargoNet Q1 2024 data show that the outlook for the rest of 2024 is grim. Q1 saw 925 documented incidents, representing a 46% year-over-year increase and 10% rise from Q4 2023. The average stolen shipment value in Q1 2024 was $281,757, exceeding the Q1 2023 average of $260,703. The declared total loss value in Q1 2024 was $76 million, surpassing the $20.4 million in Q1 2023. By any measure, it appears cargo theft in 2024 is increasing compared with 2023.
Given that current measures have been largely ineffective at reducing cargo theft, shippers must now explore innovative methods for reinforcing security at the primary hot spots for theft: distribution centers and warehouses.
Reliance on technology alone to dissuade cargo theft is not advisable. While the latest tracking devices can aid shippers in locating cargo stolen from a distribution facility, risk mitigation strategies like background checks and vetting processes can remove the threat of strategic theft in the first place.
Frank Matarazzo oversees the strategic direction of Fusion Transport while working with the executive team to drive growth, innovation and culture across the organization.
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