With the federal government taking a keen interest in cargo theft, industry stakeholders are calling upon lawmakers to increase prosecution for cargo thieves and create uniform standards for reporting the crime.
On Tuesday, April 29, industry stake holders were given an opportunity to discuss what measures the federal government should be taking to curb the rising rates of cargo theft during a House Transportation and Infrastructure Subcommittee roundtable. In his opening remarks, Subcommittee Chair Daniel Webster, R-Fla., said the issue of cargo theft in the U.S. is reaching “epidemic proportions.”
“What is clear is the federal government needs to be a better partner. That’s what we want to do. That’s why we’re having this meeting,” Webster said. “We want to be a better partner, not only with (industry stakeholders) but with states and supply chains to develop a more effective response to what’s happening.”
When it comes to why theft incidents have surged in recent years, the participants on the panel all pointed to organized crime groups employing strategic theft tactics as a key component to the influx in cargo theft.
“These retail crime and cargo theft incidents are often the product of sophisticated organized crime rings that require a coordinated response from lawmakers, police, prosecutors and the business community,” said Rodney Davis, head of government affairs with the U.S. Chamber of Commerce.
That sentiment was echoed by Scott Cornell of Transportation Travelers Inland Marine Crime, who also is a theft specialist for Traveler’s Insurance. Cornell said that as the presence of organized theft groups has continued to climb, so too has the occurrence of strategic theft like double brokering and other fraud schemes.
According to data from New Jersey-based logistics security firm CargoNet, there has been a 1,475% rise in strategic cargo theft since 2022 – to the point it now accounts for roughly 33% of all reported cargo theft incidents.
That trend has also been noted by London-based global logistics insurer TT Club, who recently said the United States is facing a “unique and concerning pattern” of cargo theft compared to other regions.
Cornell also noted a shift in where cargo theft is occurring, saying crews are shifting into “non-traditional cargo theft areas” that may have fewer safeguards in place.
Another factor impacting the response to cargo theft, according to Cornell, is the lack of uniform reporting.
“One of the biggest gaps that the industry deals with currently is there is no uniform reporting of cargo theft across the United States,” Cornell told the subcommittee. “In other words, a police officer in California may report it under a cargo theft state statute or they can report it as an auto theft … so these cargo theft statistics get diluted into many other categories of crime.”
Cornell said that each state – and even each police officer – reports cargo theft differently. Because of this, the full scope of the issue isn’t entirely clear, with Cornell claiming the reported numbers are likely 1/10 to 1/15 of the actual amount of cargo theft in the U.S. as a result of the lack of reporting standards.
Adding to the issues surrounding cargo theft, according to those on the panel, is a lack of prosecution for cargo thieves. Ian Jeffries, President of the Association of American Railroads, said the absence of effective prosecution has created an environment for crime to thrive.
“Law enforcement often makes the arrests, but nothing becomes of them,” Jeffries said. “We had one railroad arrest the same person four times in one day with no prosecution. We had another railroad involved in arresting an individual 17 times – the same person – with no prosecution. Prosecution is key in deterring this problem from growing larger.”
Davis said the U.S. Chamber of Commerce is willing to work with the subcommittee to identify “weak prosecutors” that allow criminals to “slip through the cracks.”
“The way I see it is they’re all victims,” said Bob Costello, chief economist with the American Trucking Associations. “They’re either victims of crime and cargo theft or they are spending so much money to try not to be a victim that they’re also a victim.”
Costello pointed to issues with the Federal Motor Carrier Safety Administration’s registration system – which he said too often allows bad actors to enter into the supply chain.
“They’re tricking fleets, shippers, brokers, and we’re delivering – inadvertently – the freight right to the criminals,” Costello said.
Anne Reinke, president and CEO of the Intermodal Association of North America, said an update to the registration system could go a long way in deterring – or even stopping – bad actors.
“There are illegitimate companies that can escape detection because the FMCSA registration system has been so antiquated,” Reinke said. “I do know they’re trying to update it, and it’s been a long journey for them in terms of the technology that they can use. However, if they actually just verify who they’re doing business with so that companies that register don’t already have 199 motor carrier numbers – which has happened – that would be enormously helpful.”
The members of the panel all expressed support for the recently introduced Combating Organized Retail Crime Act, urging the subcommittee to advance the bill.
Introduced in early April, the bipartisan and bicameral legislation seeks to:
- Strengthen legal tools for law enforcement by allowing criminal forfeitures for interstate shipment, transportation of stolen goods or sale of stolen goods convictions
- Expand money laundering statutes
- Enable prosecution of organized retail and supply chain groups using interstate or foreign commerce to facilitate crimes
- Mandate the creation of the Organized Retail and Supply Chain Crime Coordination Center within Homeland Security Investigations and the Department of Homeland Security
The legislation currently has 41 co-sponsors from 20 states, including representatives from Alabama, Arizona, California, Colorado, Illinois, Florida, Georgia, Minnesota, Nevada, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Dakota, Tennessee, Texas, Washington, West Virginia and Wisconsin. LL
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