The latest BSI and TT Club study of freight crime statistics highlights the direct influence of current global economic instability on criminal activity. Various geopolitical situations and the macro-economic impact of inflation around the globe have driven a series of trends through 2022 that are likely to continue in the foreseeable future. The global logistics industry need to be alert to the changing threat landscape.

Looking at freight crime in its simplest form, there are three primary factors that drive criminal activity: motivation, opportunity and ability. In this article, in advance of the release of the joint BSI/TT Club annual report for 2022, we explore these factors and how current circumstances influence crime trends.

Motivation

Ordinarily, criminal motivation is realising funds from the sale of stolen goods. The 2021 report highlighted this fact and the direct influence of market forces on freight crime; the goods stolen are often those in high demand and low in supply, those that are easy to sell for a high price. For example, the 2021 report evidenced a shift towards the theft of medical supplies and anti-bacterial products at the start of the pandemic.

In many mature economies, inflation is at its highest level in decades. While it varies by country and region, the general increase in the cost of living for many populations translates to diminishing purchasing power. As the price of everyday essential items spikes, families contend with purchasing decisions they have typically not faced for decades; ; these families may need to defer luxury or indulgent purchases to ensure their incoming funds stretch to cover the daily essentials.

criminal motivation is realising funds from the sale of stolen goods

Criminals will face these exact same constraints, but are acutely alert to recognise opportunities for easy markets. The 2022 analysis demonstrates a targeting of essential commodities, including food and beverage (16%), agricultural (9%), automotive and fuel (17%), almost certainly on the basis that shadow markets develop to satisfy consumers seeking ‘bargain’ prices for essential goods.

Nevertheless, electronics (12%) remain attractive to those behind freight crime, displaying resilience in such high-value goods despite economic downturn.

Opportunity

Vulnerability factors highlighted previously in the 2020 and 2021 Cargo Theft Reports, such as increased dwell times for cargo, eased through 2022 as global trade generally rebounded. However, cargo at rest remains at greatest risk with 2022 data confirming that the road modality presents the highest threat. Theft from facilities continues to increase.

cargo at rest remains at greatest risk

Where businesses have strategically moved away from ‘just in time’ (JIT) logistics models towards ‘just in case’ (JIC) stocking, greater storage requirements are generated, particularly in the destination country. While this increases supply resilience, managing adequate storage requirements at destination presents longer term headaches. The inability to find storage capacity at or near destination has presented security challenges, such as storing cargo temporarily in trailers and in containers, for example.

In the 2022 data, the frequency of ‘theft from facility’ incidents accounted for 26%. There have been multiple recorded incidents where criminals have stolen loaded containers or trailers from depots or facilities through 2022, on occasion in large number. This suggests highly organised activity, requiring insider knowledge, equipment, skilled labour and opportunity to access the facility.

Of course, breaking and entering a facility or depot to access cargo presents greater risks for the criminals and they would often need to contend with established security measures, such as fences, CCTV and ANPR equipment. If caught, the crime categorisation in many jurisdictions is more serious than cutting the curtain of a trailer and stealing cargo at the roadside. However, the potential rewards are much greater too; rather than being satisfied stealing several pallets of goods from a truck at the roadside, there is opportunity to steal several truckloads of goods at a depot facility. 

Ability

The greatest challenge for those responsible for managing security through the global supply chain is criminals’ ability to access cargo. Trends in this regard vary by country and region and include sophisticated methods as well as pure opportunism. 

Information security remains a key threat for the supply chain

Information security remains a key threat for the supply chain. Digitalisation can, if not carefully managed, create vulnerabilities. The process must be twinned with robust management controls across all types of user to ensure that access rights entirely appropriate at all times, including revoking where necessary. The threat landscape for physical and technological access is vast, including apps and personal devices, for example.

Fraud is a strategy that TT has highlighted regularly through 2020 and 2021; the data for 2022 suggest that there is no decrease in this aspect of risk. While fictitious collections remain a relatively small proportion overall, such incidents continue to occur and the apparent ease with which the criminals are able to exploit the supply chain to access goods in this way remains concerning.  

The 2022 analysis evidences that insider risk is increasing and evolving, with insider involvement in 21% of incidents globally. Examples include payments to truck drivers to deviate from their planned route so that criminals can steal the cargo, whilst other instances involve granting access to a closed facility or vital information regarding site security provisions.

The principles of Know Your Customer/Counterparty (KYC) and due diligence remain of great importance in mitigating freight crime threats. Vetting potential sub-contractors and your own workforce, evaluating carefully the potential risks and understanding how to identify threats are all crucial steps.

Of course, motivation, opportunity and ability are intrinsically linked. Where the cost of living for example increases to uncomfortable levels, not only is there greater potential for a shadow market to develop (motivation), there are changes to supply chain strategies (opportunity) and it arguably becomes easier for criminals to access cargo (ability).

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