National Insurance Crime Bureau (NICB), the nation’s leading non-profit association dedicated to preventing insurance fraud and crime, has officially published a report, where it reveals that, as beneficial as digitization might have been, it is also increasingly causing fraudulent pickups, fictitious pickups, fictitious carriers, and cyber-enabled logistics manipulation.
Going by the available details, this particular report claims that, for the first time ever, the value of stolen merchandise and estimated has breached the mark of $1 billion in 2023. To give you some context, cargo crimes increased to an all-time high, up 27% from 2023. In case that wasn’t enough, annual cargo theft losses are also expected to rise another 22% from already historic levels before 2025 rounds up to a close.
As for the estimated average value of an individual theft, it was deemed to be more than $202,000.
Taking a deeper view of the technologies that were used to commit these crimes, we begin from GPS Jamming, which can disrupt tracking systems, and at the same time, allow stolen cargo to be moved without detection. We get to say so because NICB agents have confirmed confiscations of these devices in cargo theft incidents, noting that thieves frequently disable GPS trackers which are not concealed in a proper manner.
Next up, the report found VoIP, such as TextNow, helping thieves spoof legitimate carrier contact information, all while remaining anonymous. These applications basically offer users the knowhow to select and utilize telephone numbers with any valid area code.
Taking that into account, criminals are leveraging these services along with fictitious email accounts and altered Department of Transportation (DOT) records to impersonate companies, bid on shipments, and reroute freight to unauthorized drop locations.
Another technology used by fraudsters is related to the mechanism of synthetic IDs. Synthetic IDs are basically identities created from a mix of real and fake identifiers including social security number, date of Birth and name, email, address, or phone, generally derived from stolen or leaked data.
Beyond that, we have phishing attacks emerging as one of the most prevalent mediums of fraud. Simply speaking, phishing attacks are a form of social engineering and a scam where attackers deceive people into revealing sensitive information or installing malware like viruses, worms, adware or ransomware.
Deploying these technologies, criminals were able to conduct, for instance, railway theft, which occurs when organized criminal groups take cargo from trains or rail yards, either while in transit or stored.
Furthermore, they made ransom demands after impersonating as legitimate motor carriers to gain possession of shipments through broker load boards.
Interestingly enough, criminals also went on to shorten loads, which is a term used when thieves steal only a portion of the cargo. This tactic makes it possible for criminals to pilfer valuable items without attracting immediate attention. The incentive to use such a method talks to how it often goes undetected until the driver reaches their destination.
Not just that, selectively removing portions of the cargo load also allows criminals to minimize the risk of detection and increase chances of success.
Joining the list of crime archetypes is a strategic cargo theft. This brand of theft makes up events initiated through deception or fraudulent means. The idea here is to attack one of the links in the supply chain. Hence, deception may take place within the supplier ecosystem, with the freight broker, and/or the transporter.
NICB also took this opportunity to unveil some measures one can take to avoid such frauds.
The stated measures include screening every employee, where you conduct a background check on every employee, especially those with access to the shipping information.
Next up, the relevant parties are advised to check transportation partners before hiring. For instance, it is suggested to use freight brokers and transporters who do not permit double brokering. One must also ensure that only they, as the shipper, can make re-routing decisions rather the broker, transporter dispatch etc.
You must also implement in-transit security measures that include not stopping within the first 200 miles, parking in known secure locations, and avoiding hot spots, areas which are known for increased frequency of cargo crime.
