Bad guys have turned to identity theft and sophisticated fraud to steal drugs, electronics, and food right off the loading dock.
Freight trucks have always made a convenient target for thieves. Containers can be pilfered at a roadside rest stop, or a whole truck can disappear while its driver grabs a hot shower. Sometimes truckers are even hijacked at gunpoint.
But a new generation of tech-savvy truck thieves are innovating on old methods.
“One of the M.O.’s that’s on the increase is in a sense identity theft—impersonating another company,” says Nick Erdmann of the security technology firm Transport Security.
The tactic is known as a fictitious pickup. It starts with loadboards—websites like Dat.com and Truckstop.com where shipping brokers list loads in need of delivery. Though the contents of those loads aren’t listed, canny thieves can spot the valuable ones based on certain details: Loads requiring high insurance minimums, loads requiring a team of drivers, or loads coming out of particular locales, such as technology corridors.
Then, using falsified credentials to pose as legitimate truckers, criminals contract to carry the load, drive their own truck to a warehouse or distribution center, and simply pick it up. It can be days before cargo owners even know they’ve been robbed.
“People just hand it over,” says Detective Eric Dice, who heads a cargo theft task force in Florida. “It’s amazing.”
The average value of a load lost to a fictitious pickup was more than $140,000 in 2014, and fraud has played a role in much as 10% of all cargo theft in recent years, according to the freight security firm CargoNet.
Impersonating an existing company can be as simple as finding their logo and address on their website. A company’s Department of Transportation-issued Interstate Operating Authority number is also often publicly displayed—and if not, it’s just a phone call away.
“You just say, ‘Hey, we’re trying to process your invoice, we’ve got a check for you,’” says Keith Lewis, CargoNet’s vice president of operations. “Of course I’m going to give you my [number]. I think I’m getting money.”
Alternately, criminals can use a prepaid credit card to get a new DoT number online through the USDOT’s SAFER portal—thanks to deregulation, applicants are not thoroughly vetted.
Most devious of all, according to Lewis, defunct companies can be revived, along with their DoT number. Because DoT numbers are issued chronologically, an older, lower number is often an indicator of trustworthiness to freight brokers.
The ease of falsifying trucking entities is illustrated by the case of father-and-son heist team Jon and Kyle Dickerson. They operated a string of cover operations over fourteen years, with names including D&T Trucking, Night Line Trucking, and Fish and More. When one company racked up safety violations or otherwise came under suspicion, they just started a new one.
The logistics industry has moved to tackle the problem of fictitious pickups, which declined in 2014 after ticking up steadily since 2005. One part of the solution is enhanced security technology. Many truckloads now contain hidden GPS trackers, a practice pioneered nearly a decade ago by the tobacco industry, according to Erdmann. Tracking units, such as those offered by Lojack SCI, are now no bigger than a cell phone, easily attached to trucks or slipped inside packages.
Other technologies, though, are actually boons to thieves. RFID tagging has been championed by many in the logistics and transportation industry, but Lewis says criminals can use their own RFID readers to identify and target lucrative loads.
While thieves do go after high-value electronics, those are easily traceable. The biggest target, surprisingly, is food, which can be sold back into the supply chain through unscrupulous distributors. “I’ve never seen a serial number on a package of chicken,” says Lewis. “Once you eat it, the evidence is gone.”
The total cost of cargo theft nationwide is hard to measure, mostly because reporting is spotty. Lewis says that law enforcement, insurers, and carriers don’t talk enough. Most states don’t have separate criminal laws covering cargo theft. And of the theft data CargoNet gathers, less than half includes the value of the loss.
Carriers want to save face, says Lewis: “I’m embarrassed to tell anybody I’ve been burned.”
In that informational vacuum, what’s left is speculation. Some estimates put total cargo theft losses at $15 billion and up. Others say theft adds as much as 20% to the cost of consumer goods.
But Lewis, for one, has a deeper motivation than the numbers.
“My dad owned a trucking company, and I understand what this does to a small business. Even for a big company, the consequential damage is tremendous.”