Stolen goods need a market – Avoid being a receiver
Reducing the threat of theft in the supply chain can have many lines of attack, freight insurance specialist TT Club is advocating that of cutting off the market for stolen goods. Receiving stolen property is not just illegal, it provides a market for the criminals, consequently causing lost time, revenue and reputational damage to the rightful owners as well as the transport and storage business that serve them.
Theft of cargo is an ever-present concern within the logistics industry and prevention is in the interest of businesses, law enforcement agencies and the economy as a whole. As the industry seeks to understand the way that criminal networks operate, it is worth questioning what happens to goods after they are stolen. Organised criminal networks employ many of the same ‘business’ strategies used by legitimate supply chain operators. There are a myriad of examples of police forces uncovering large warehouses containing stolen goods, trucking operations engaged in the movement of those goods and incidents of stolen goods entering the retail market.
As TT’s Managing Director, Loss Prevention Mike Yarwood reports, “Earlier this year two containers of BBQ equipment destined for a high street retailer were stolen from a depot in the UK. Two months later the owner of the goods, shopping in another retail store recognised the equipment and, by tracing the serial numbers, was able to identify them as those stolen earlier in the year.” A ongoing legal wrangle has ensued but as Yarwood explains, “The moral of the tale is that a relatively ready market for stolen goods is accessible to thieves if unknowing ‘receivers’ do not take sufficient care to ensure the goods they purchase are legitimate.”
TT is promoting the need for more vigilance and is offering preventative advice to procurement managers that covers such means as:
- Forming strong, ongoing partnerships with trusted suppliers and thoroughly vetting all new suppliers
- Implementing a code of conduct that explicitly forbids unethical and illegal procurement practices, including whistleblower protection
- Verifying the provenance of all goods. All incoming goods should be accompanied by documentation such as bills of sale, invoices and shipping records
- Initiating regular audits to be conducted by an external party and conducting particularly stringent due diligence when procuring high-risk goods, such as electronics or luxury goods
- Engaging with law enforcement immediately if suspected stolen goods are identified
Yarwood emphasises the damage caused by theft, “A recent study by the University of Plymouth valued the cost of goods stolen in the UK alone during 2020 at £95.7m. However, the cost of the goods fails to take into account many other factors that impact on the businesses involved,” he highlights. “Every theft costs the transporter wasted resource as that particular order was not delivered; survey costs to assess the value of the lost cargo are incurred and, most importantly, reputational damage occurs that may lead to the future loss of business. Moreover, insurance premiums will rise for all participants.”
The wider impact on society at large include the funding of criminal organisations, which leads to not only further freight crime but other criminal activity. It is thought that the sale of stolen cargo has become one of the primary revenue streams for organised criminal groups around the world. Stopping, or at least reducing the market outlets for the proceeds of such thefts must become a priority of all supply chain participants.
About TT Club
TT Club is the established market-leading independent provider of mutual insurance and related risk management services to the international transport and logistics industry. TT Club’s primary objective is to help make the industry safer and more secure. Founded in 1968, the Club has more than 1200 Members, spanning container owners and operators, ports and terminals, and logistics companies, working across maritime, road, rail, and air. TT Club is renowned for its high-quality service, in-depth industry knowledge and enduring Member loyalty. It retains more than 97% of its Members, with a third of its entire membership having chosen to insure with the Club for 20 years or more.
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