Insurer warns over cargo crimewave as supply chain under attack

Marine cargo operators and Risk managers have been warned they need to act in the face of a disturbing and rapid increase in the scale of freight crime in South America.

Insurer the TT Club has worked with BSI SCREEN, the Logistics Association of Chile (ALOG) and the crime investigation unit, Signum Services to focus on a worryingly dramatic trend in the Chilean freight transport sector.

It has resulted in a report, ‘Freight crime in Chilean supply chains’, based on the  combined data resources of the four organisations.

In an introduction to the risk landscape, the report notes that pandemic-induced measures such as quarantine, restrictions in movements, curfews and had the effect of reducing the incidence of cargo theft for much of 2020 and 2021.  However, last year, with such limitations lifted, levels of crime sprung back with vengeance to 27% higher than pre-pandemic levels, according to ALOG data.

“The underlying factors that seem prevalent in explaining the alarming statistics seem to be predominantly social and economic in nature,” comments TT’s managing director of Loss Prevention, Mike Yarwood.  “Inflation increases in the cost of living and social unrest have motivated individuals to turn to crime.  These circumstances, which also encourage a larger black market, particularly in foodstuffs, instil heightened criminality in the population.”

The report found that criminal organisations that are behind much of the theft have exploited to a greater degree than in the past those employed in the supply chain, to provide valuable data and information on cargo flows, nature of loads and an ability to falsify delivery instructions. Labour strikes, also common in a recession, create pinch points in the usual smooth flow of goods. Such locations become a focal point for crime. The reported statistics show that second to hijacking as a mode of theft (57%), is the combined activity of stealing from a facility or of a vehicle itself, when cargo is at rest, contributing to 32% of all incidents.

“A primary goal of TT in participating in this report is the same as that of our partners at ALOG and BSI,” explained Yarwood. “It is to create a greater awareness of the threats, so operators can take mitigating protectionist steps. To this end, our report carefully details two of the primary strategies used by the criminal fraternity, – hijacking and the use of insider knowledge and cooperation.  The report also provides a well-researched case study on the role criminal organisations are playing in infiltrating the supply chain in Chile, and throughout Latin America.”

As with all awareness reports of this nature, TT  Club said it and its co-authors are keen to offer guidance on how such theft risks can be alleviated with advice, in particular on combatting the criminal device of fictious pick-ups. The report contains a long list of measures from secure verification procedures and driver ID checking to staff training in identifying suspicious circumstances and monitoring through tracking technology to ensure shipments are being delivered correctly.

“With the help of our partners, utilising a wide range of in-depth data resources, TT will continue to research cargo crime internationally in order to forearm the supply chain industry with information on trends in such damaging losses,” Yarwood concluded.