Products at risk of theft from Europe supply chain

Last year saw a five year high in reported cargo theft from trucks and warehouses. In light of these figures, the Transported Asset Protection Association discuss best practice for protecting assets and cargo from damage, loss or theft as a result of terrorist activity.

Cargo thefts from trucks and warehouses reported to the Transported Asset Protection Association (TAPA) rose to a five‑year high in 2015. In the Europe, Middle East and Africa (EMEA) region, TAPA’s Incident Information Service (IIS) captured 1,515 reports of cargo crimes from manufacturers, logistics service providers, insurers and other supply chain security stakeholders. Only 22 per cent of these incidents recorded a value but this still produced a combined loss for these crimes of €34,528,558. Nonetheless, the number of reported crimes remains only a fraction of the total number of attacks taking place on the supply chain every day, all over the world.

2015 data also reinforces previous evidence that cargo criminals are becoming far less selective over the types of cargo they target.

When the TAPA was founded in EMEA over 15 years ago, the main aim of its manufacturer and logistics service provider members was to combat the growing threat of high value technology thefts from supply chains across the region. Today, while high value technology is still a target, it has been joined by seemingly everything else. Products with a low unit value are just as attractive to cargo thieves – often organised criminal gangs – because of the high volumes they move in. And, these products are often easier to dispose of and less traceable.

It is the increasing risk to all goods moving in supply chains that has boosted TAPA EMEA’s membership to some 475 supply chain security stakeholders, including many of the world’s leading brand manufacturers in industry sectors, such as: computers and laptops; phones; food and drink; pharmaceuticals; tobacco; clothing and footwear; cosmetics and hygiene; furniture and household appliances; car parts; tyres; tools and building materials; and metal.

For industry sectors such as pharmaceuticals and food and drink, the ramifications of cargo crime and the actual or risk of contamination of products is even more far‑reaching and costly. Public health is at stake, not to mention the brand reputations of the companies concerned if these products find their way back into the consumer environment via the black market.

The price of theft
In the past year alone, TAPA’s IIS recorded a series of high value thefts in both product categories: €3,000,000 of pharmaceuticals stolen from a third party facility in Italy; €2,038,522 of champagne from a warehouse in the UK; €500,000 of pharma products stolen from a facility in Italy; €481,479 of whisky stolen in the UK; €439,423 of pharmaceuticals stolen in Russia; €339,752 of food and drink after a truck hijacking in the UK; €275,131 of vodka from a truck in the UK; €260,000 of food and drink stolen from a truck in Germany; €208,000 of pharmaceuticals after a deceptive stop and truck hijacking in Russia; €200,000 shipment of lobsters after a deceptive pick-up in Denmark; €166,591 of dairy products stolen in a truck hijacking in South Africa; €100,000 of meat when a truck was stolen from an industrial estate in Germany; €100,000 of pharmaceuticals from an original facility in Italy; €100,000 of fresh salmon from a trailer in Norway; and €100,000 of food and drink following a clandestine intrusion of a truck in Belgium.

One of the Association’s greatest challenges is encouraging companies, insurers and law enforcement agencies to share cargo crime incident data. A 2007 study by the European Parliament stated that the cost of organised theft of commercial vehicles and their loads was €8.2 billion a year in Europe alone but various factors continue to impact on the current levels of data reporting.

Many companies remain reluctant to share incident data while a lot of law enforcement agencies do not categorise thefts from cargo facilities or freight trucks as cargo crimes. Instead, they record them in the bigger general reporting areas of vehicle and property crime, making it impossible to extract freight‑related data.

Threat awareness
The one thing that TAPA is in no doubt about, however, is that cargo crime in Europe and, indeed, globally, is increasing at an alarming rate. The 1,515 recorded freight thefts in 2015 represented a 37.4 per cent increase year-on-year.

On a positive note, this rise is also due to increased sharing of cargo crime data by police forces that do identify and record such incidents. TAPA EMEA says it can see a growing awareness of the threat of cargo crime among law enforcement agencies in the region and, even more importantly a willingness by police forces in major European countries to share data with the Association. This, in turn, is helping its manufacturing and logistics service provider members to increase the security of their supply chains.

Reporting crime
Nonetheless, the reporting of cargo crimes to the Association remains a relatively low percentage of overall cargo crimes. It is working hard to remove the ‘fear factor’ for companies when it comes to admitting they have suffered a supply chain loss. Most significantly, the Association does not record the names of companies that are the victims of cargo crime. It is only seeking intelligence on the types of incidents, where they occur, the products targeted and the value of the loss if this is available.

Belgium is a good example of how support from law enforcement agencies is making a significant difference. In 2014, TAPA EMEA’s IIS recorded only 12 cargo thefts in Belgium. In 2015, Belgian police were able to identify and share information with TAPA on 341 cargo crime incidents. This puts Belgium at a similar level to other major supply chain gateways such as the Netherlands, which recorded 458 cargo crime incidents in 2015, and the United Kingdom with 367 thefts or attempted thefts recorded last year. This reflects the equally proactive approach being taken by Dutch and British law enforcement agencies.

TAPA has reminded its members that it is wrong and dangerous for companies to assume that countries with a low number of reported cargo crime incidents to TAPA EMEA present any less risk than countries that have reported a higher incident rate. Higher levels of reporting are, most often, a sign of proactive police agencies taking cargo crime seriously and sharing data to help companies reduce crime. They are not hiding away from a problem that is happening every day all over the world and are working hard to do something about it. TAPA says this is helping businesses to achieve positive results in terms of supply chain resilience.

TAPA is continuing to promote partnerships with law enforcement agencies in other countries across the EMEA region where attacks on facilities and goods in transit are known to be significantly higher than the number of incidents reported to IIS. This group of countries includes Germany, France, Italy and South Africa. During the course of 2015, the Association organised conferences for supply chain security stakeholders and law enforcement agencies in Germany, South Africa, Italy, the Netherlands and Spain to discuss the challenges of cargo crime at regional and national levels.

TAPA EMEA’s IIS Annual Report 2015 shows cargo crime incident data was captured in 29 countries across EMEA over the course of the year, including 70 incidents with loss values in excess of €100,000. Five countries saw incidents involving product losses of more than €1 million. The average loss figure for last year, based on incidents that recorded a value, was €101,256.

Theft from vehicle
The lack of secure parking locations along main motorways crossing Europe continues to result in the majority of freight thefts occurring when trucks stop at unsecured parking locations when drivers need to take mandatory rest breaks. Incidents are frequently recorded as having taken place at motorway service stations, on industrial estates or in lay‑bys adjacent to main roads. In total, 57.2 per cent of crimes reported to TAPA in 2015 were the result of trucks stopping in unsecured parking locations, a further increase on the 46.6 per cent in 2014.

In 2015, 53.3 per cent of all incidents where recorded by TAPA’s IIS as ‘Theft from Vehicle’, also up on its 2014 figure of 48.5 per cent. Combined with the 205 Theft of Vehicle incidents, 145 Theft from Trailer, 81 Truck Theft and 61 Theft of Trailer cargo crimes, over 85.7 per cent of all freight thefts in the EMEA region in 2015 were truck‑related. This is without taking into account the 60 hijacking incidents, which predominantly involved attacks on trucks while en route.

The Association has also alerted its members to the growing number of incidents experienced by companies using online freight exchanges to book trucking services. Online freight exchanges are now an important and every day part of doing business in Europe and manage an estimated 500,000 new freight offers a day. In the vast majority of cases, they represent good news for customers and transport operators, matching available capacity with orders and delivering a highly efficient solution. However, like every other part of the supply chain, they are also a target for cargo criminals and TAPA EMEA has been notified of a series of incidents where shipments booked through online freight exchanges have subsequently disappeared after pick-up.

TAPA is also greatly concerned by the increasing number of violent attacks on truck drivers by criminals who are intent on stealing their cargo loads. IIS recorded incidents of drivers being threatened with knives and guns as well as physical assaults that led to some drivers being kidnapped and others needing hospital treatment.

As part of its ongoing work to reduce freight crime, in 2015, TAPA launched a global campaign to double the number of TAPA‑certified warehouse facilities to over 2,000 in Europe, the Americas and Asia Pacific in the next three years and to make a ‘quantum leap’ in the number of trucking companies operating in compliance with the Association’s TAPA’s Facility Security Requirements (FSR) and Trucking Security Requirements (TSR). This includes a new self‑certification programme for TAPA’s entry level FSR Class ‘C’ and TSR Level ‘3’ Security Standards.

With incident data reported to TAPA EMEA in January 2016 showing 92 new cargo crimes and a 67.2 per cent year‑on‑year increase, it looks like there will be no respite for manufacturers and their logistics service providers in the year ahead.

Further information
www.tapaemea.org