Андрей Журавлев AdobeStock_396129298
The logistics and transportation industry is under siege from increasingly sophisticated and organized fraud schemes. Findings from a fraud report survey released by the Transportation Intermediaries Association (TIA) reveal the extent of the threat, the financial impact on businesses and the critical steps the industry must take to protect itself.
“The logistics industry is at a pivotal moment,” the report states. “With the rapid increase in fraudulent activities, it has become essential to understand the scope and impact of these crimes.”
Key takeaways:
- The most prevalent form of fraud — cargo theft — has seen a dramatic increase, with sophisticated schemes such as strategic cargo theft becoming more common. According to the TIA Fraud Framework, there was a 600% increase in cargo theft between November 2022 and March 2023.
- Financial schemes like unlawful brokerage and fraudulent invoicing are becoming increasingly common, with criminals exploiting gaps in the supply chain to steal funds and merchandise. Survey data reveals that unlawful brokerage scams were identified as the most common type of fraud, with 43% of respondents marking it as their primary concern.
- Criminals are impersonating legitimate companies, using stolen identities to commit fraud. This type of fraud often leads to significant financial losses and damage to a company’s reputation, with 17% of respondents noting spoofing emails and another 11% citing identity theft as their top fraud concerns.
- Employees within a company may also engage in fraudulent activities, further complicating prevention efforts.
- Cyber-attacks targeting sensitive company information are on the rise, with hackers using this data to execute more complex fraud schemes.
- Specific states, particularly California, Texas, Illinois, Georgia and Florida, are identified as having the highest incidents of theft.
- Truckload freight is overwhelmingly the primary target of fraud, with 98% of respondents identifying it as the most vulnerable mode.
- Eight types of fraud consist of spoofing, unlawful brokerage scams, fictitious pickups, phishing, identity theft, email/virus, inbound phone calls, and text messages. A significant number of respondents—72%—experienced at least three different types of fraud. This indicates that many companies are dealing with a multifaceted threat that requires a broad range of preventive measures. Additionally, 64% of respondents experienced at least four types of fraud, and 7% reported experiencing all eight types listed in the survey.
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