Cargo thefts prompt demand for greater risk management

Insurers have called for urgent action to clampdown in a wave of cargo thefts in the Middle East.

The TT Club has issued a new study in conjunction with the supply chain services and solutions at standards company BSI. The study, ‘Cargo Crime in Gulf Countries and Regional Free Trade Zones’ has been created as a risk mitigation tool for transport operators, its authors said timing could not have been better given the spike in cargo movements running-up to the seasonal festivities.

It found 76% of cargo theft is from warehouse and storage facilities, with crime hot-spots in UAE & Saudi Arabia.

The criminals are targeting high-value goods such as electronics targeted, with insider assistance and corruption playing a prominent role and smuggling of illicit contraband prevalent in Free trade Zones (FTZ)

TT Club’s Mike Yarwood said: “Our reports are intended to alert those in the supply chain to the variable and developing trends in the risk of cargo theft during intermodal transportation.  The unique combination of BSI sourced data on criminal activity and TT Club’s insurance claims records provides valuable intelligence to operators.

“Regular updates of this nature are essential as criminal gangs are constantly altering their points of attack.  The current prevalence of supply chain congestion, delays, disruption, and in the Middle East region in particular packed warehouses, makes such information critical.”

The report highlights that warehouse thefts and supply chain corruption are the stand-outs, with a concentration on higher risk areas across the United Arab Emirates (UAE) and in the Kingdom of Saudi Arabia (KSA). The role special economic zones play in the Middle East also effects regional disparities in cargo theft.

Free Trade Zones (FTZ) are a significant feature of the regional economy and represent potential vulnerabilities for supply chains by virtue of facilitating high volumes of trade under simplified customs procedures that can provide opportunities for criminals to act. Furthermore, as Gulf Cooperation Council (GCC) economies return to pre-pandemic levels, and data provided by the International Road Transport Union (IRU) is projecting growth in trade, it is possible that criminals will also seek to exploit these higher volumes of cargo throughput to introduce illicit drugs and counterfeited products into shipments.

Umberto de Pretto, Secretary General, International Road Transport Union explained: “The IRU, together with its members and partners, continues to strengthen global transport supply chains, notably through the implementation of international standards such as TIR for compliance management and security, and through innovative training to help road transport professionals identify risks and adapt operations to avoid security threats.”

There is also valuable guidance on mitigating the risk contained in the report.  These guidelines cover avoiding the introduction of drugs into shipments; reducing theft from facilities and combating counterfeit smuggling, all of which are of particular concern in the Middle East region.

“Operators should be consistent in their vigilance, especially in the current season of festivities when the movement of gifts is at a peak,” added Yarwood.  “TT’s intention is to help reduce theft related loss and to that end these reports offer loss prevention advice to complement the joint analysis of current trends.  As well as financial damage these incidents can cause severe operational disruption and unquantifiable reputational damage to supply chain service providers.  As a consequence, it remains of key importance to the transport industry to identify, prevent and report any criminal activity.”

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