Canadian Retailer - Fall 2013 - 35

On top of this fragmentation, many victims of
Trucking is a $65 billion industry in Canada, with more than 90 cargo theft are not reporting the crimes or sharper cent of merchandise sold in Canadian retail locations shipped ing the information, Marino says. They don't
by truck. Cargo thieves siphon about $5 billion in goods from this want their competitors to know, they don't want
pipeline. In the U.S. thieves steal upwards of $30 billion in assets to see insurance premiums increase and they
annually. Within the Greater Toronto Area alone, the supply chain worry about the damage to the brand that could
loses more than a half million dollars a day to thieves plucking come from speaking openly about how crime
trucks and cargo containers from distribution centres located syndicates target their deliveries.
along the 401 corridor, the main shipping artery between MontAnd some victims seem happy to let their inreal and Toronto.
surance companies carry the risk.
Cargo theft has been a profitable business since the days when
"There is the thinking that insurance will make
bandits hijacked stagecoaches. The profit margins are huge, the me whole," says Marino. "It is a myopic way of
penalties slim, and the chances of getting caught rare. And like looking at things."
any good business people, cargo thieves have evolved their busiCargoNet's advice to LP leaders: become a
nesses to keep up with their competition-police and retail LP.
larger part of the solution. Marino says that reTen years ago, retailers saw "a straight up theft of trailers," says tailers should encourage motor carriers to parSal Marino, vice-president of CargoNet, a clearinghouse for infor- ticipate in programs that mitigate risk, to build
mation on cargo theft. Thieves targeted commodities like phar- a bullpen of trusted carriers who use processes
maceuticals and tobacco. Today, thieves target food, perishables, and technology that reduce theft, and to develop
base metals and electronics.
data intelligence on the impacts of cargo theft.
And unlike in previous years, thieves are using
technology to minimize their risks. Marino says
"We need to eliminate fragmentation. A lot
cargo thieves create fake identifications, docuof entities are communicating [the crimes]
mentation and websites to commit their crimes.
They pose as legitimate carriers with these docubut the crimes are not being aggregated"
ments, drive away with the cargo containers, hit
- SAL MARINO
their escape route on the highway and make it to
CargoNet
their destinations before the retailer has figured
out that the shipment hasn't arrived.
Bob Goodall, director of law enforcement services at CargoNet,
says that the amount of surveillance involved in these heists, the DATA SECURITY
indications of inside players, the "steal to order" quality of some IT and LP need to protect business
crimes, the sophistication of the planning and execution, all sug- from data loss
gest that the major cargo theft rings are operated by organized
DATA THIEVES-the organized criminals, haccriminal syndicates.
tivists and foreign governments who profit from
"It's that sophisticated," he says.
information-have retailers in their sights. They
conduct sophisticated attacks to pilfer data from
Stopping cargo theft
For retail LP, cargo theft is a loss that does serious damage to a retailers' online operations, mobile operations
retailer's balance sheet. And not just with lost sales. Retailers who and data centers, and locally, crooks rely on
use "just in time" replenishment strategies are particularly at risk brawnier attacks, like the point-of-sale smash and
grab, to breach retail security and drain away the
of lost sales, upset customers and empty shelves.
Cargo theft does get attention by LP leaders in Canada. As Goo- data. The attacks are numerous enough to make
dall says, cargo theft has been a regular subject of discussion at LP retailers second only to financial institutions in
conferences in the last several years. The transportation industry, the number of breaches that occur each year.
"There are some retailers who are safe, and
through the Canadian Trucking Alliance, police associations, retail
and allies in the insurance industry, have been pushing for legisla- some who are not. There are some retailers who
don't realize they are not safe," says Stewart
tion that takes into account the damage caused by cargo theft.
But Marino says that more needs to happen-especially in the Cawthray, chief security architect at IBM.
area of reporting-before cargo thieves will take a serious hit to
their businesses.
Leaky businesses
"We need to eliminate fragmentation," he says. "A lot of entities are
The reason retailers get hit so often is because
communicating [the crimes] but the crimes are not being aggregated." they're such easy targets. When retailers calcuA lack of standardized reporting for cargo theft, a lack of aware- late the risk associated with implementing seness about the costs of cargo theft and jurisdictional divisions be- curity features, many choose to accept the risk
tween police forces also give cover to cargo thieves.
rather than mitigate the risk.
Phenomenon today

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Canadian Retailer - Fall 2013

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