Cargo Theft Is Hiding in Plain Sight - a chat with the Cargo Theft Mitigation King himself, Scott Cornell

Cargo theft is getting smarter, quieter, and easier to mistake for normal business and that’s exactly why it’s so dangerous. A compromised email, a clean-looking bill of lading, a driver who seems legitimate, and suddenly a real shipment is delivered straight to a criminal with everyone thinking they did their job. That’s the modern reality of supply chain security, and it’s hitting freight brokers and shippers especially hard.

We sit down with Scott Cornell, Chief Risk Officer at SPG Cargo and Logistics and one of the leading cargo theft and transportation crime specialists in the United States. Scott breaks down the difference between straight cargo theft (physical theft, pilferage, stolen trailers) and strategic cargo theft (deception-first schemes like double brokering, MC number fraud, identity theft, and email compromise). We dig into why food and beverage is such a popular target, how criminals “launder” freight through paperwork, and why a broken seal can turn a recovery into a total loss.

We also zoom out to the systems problem: cargo theft is often misclassified in law enforcement data, which means the true scale is hard to measure. Scott explains why the CORCA legislation matters, what better reporting could unlock for investigators and prosecutors, and how organizations like TAPA Americas raise the bar with security standards, intelligence sharing, and summits that bring industry and law enforcement into the same room. If you’re responsible for freight, compliance, risk, or operations, you’ll leave with clearer red flags, better questions to ask at pickup, and a stronger sense of what “respond immediately” really means.

Subscribe, share this with a colleague, and leave a review so more people in the supply chain can spot the scam before the load disappears.

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Transcript

SPEAKER_00 0:00

Ready to go. We're listening to By Land and By Sea, powered by the Maritime Professor. When most people hear cargo theft, they probably picture the opening scene from Maybe the Fast and the Furious. Cars surrounding a tractor trailer, a highway takeover, a very obvious crime. But cargo today looks a lot less like Hollywood, maybe not at all like Hollywood, and a lot more like a legitimate transaction. Stolen identity, false paperwork, compromised email account, a real driver delivering a real shipment right to the criminal. So what does cargo theft actually look like today? How has it changed? And how does law enforcement have the tools to keep up? Let's talk about it. That's what we're talking about today with our guest, Scott Cornell. Hi, welcome back to Byland and by Sea, an attorney breaking down the weekend supply chain, presented by the Maritime Professor. Me, I'm Lauren Beegan, founder of the Maritime Professor, former Federal Maritime Commission International Affairs Attorney and founder of Squall Strategies. By Land and by Sea is your go-to resource for navigating the regulatory side of global ocean shipping. And me, I'm your favorite maritime attorney, aren't I? As always, this podcast for educational purposes, all means should not be considered legal advice. There is no attorney client privilege created by this video or this podcast. If you need an attorney, contact an attorney. So let's get into it because as you know, ocean shipping moves the world. All right, like I said at the outset, today I'm joined by Scott Cornell, Chief Risk Officer and Transportation Crime and Theft Specialist at SBG Cargo and Logistics. Scott has spent more than 30 years investigating cargo theft and transportation crime, along with internal theft, embezzlement, and corporate investigation. Before joining Logistics, he spent 25 years at Travelers, where he led the transportation division and helped establish the insurance industry's first fully dedicated cargo theft unit, known as the Special Investigations Group. He also serves as chairman of TAPA America's Transported Asset Protection Association and sits on the TIA's cargo fraud task force. In our conversation, we talk all about how Scott even got into this work from just doing a couple deliveries with a truck. That's how we started. What TAPP America has done, how cargo theft has changed over the past five years. The difference, we get into the nitty-gritty a little bit. We go through the difference between straight cargo theft and strategic cargo theft. We still see more straight cargo theft, as he says. But strategic cargo theft is really one of those things that makes you think. We talk about what keeps them up at night and what corka. There's a bill going through Congress right now. Corka. What it could actually change for investigations and prosecutors. All right, we're gonna get right into it. Enjoy my conversation with Scott Cornell. My guest today is Scott Cornell, Chief Risk Officer and Transportation Crime and Theft Specialist at Logistics. Scott has spent more than 30 years investigating cargo theft and transportation crime, along with internal theft, embezzlement, and corporate investigation. Before joining Logistic, he spent 25 years at Travelers, where he led the transportation division and helped establish the insurance industry's first fully dedicated cargo theft unit known as the Special Investigations Group. Scott worked closely with law enforcement and cargo theft task forces across the country and has advised federal policymakers on cargo theft and supply chain security. He's testified before Congress in support of cargo theft legislation and worked directly with the Department of Transportation and the Federal Motor Carrier Safety Administration, FMCSA, on strategic cargo theft. He also is currently serving as the chairman of TAPA America's, the Transported Asset Protection Association, and sits on the Transportation Intermediaries Association Cargo Fraud Task Force. Scott is widely recognized as one of the country's leading experts. I call him the country's leading expert, but he's one of the leading experts on cargo theft prevention and recovery. And I am so glad to have him here today. Scott, welcome to the show. Thanks for being here.

SPEAKER_01 4:18

Thank you. It's always good to see you, my friend. And uh good to get time to talk about this issue and get the word out. That's just what we're trying to do, right? Educate everybody on it. Just one small thing. Our company is merged now. So we're SPG Cargo and Logistics. So that's the new company that combines the two companies that merged. It's good, great company. So it's been a good move.

SPEAKER_00 4:39

That's great. Congratulations. That more, the more power, the better, because you got to go get those bad guys. So this is right, right? Great. Well, thanks so much for being here. I think that this is such a wonderful topic to bring to my listeners. Like I've said many times, we tend to be more on the maritime side of things, but that interchange between where the ports and the yards receive that cargo and the cargo goes out. There, it's such an important piece to dive in a little bit more on the conversation of supply chain and cargo theft security that I'm really excited to dive into that and talk about that a little bit more. But as I do with all my guests when they're first on the show, I want to know a little bit more about you. I want my listeners to know a little bit more about you, knowing the person behind the work sometimes gives us a little bit more of a glimpse on why you're doing the things that you're doing and where you're moving. So before we get into all these threats, tell me a little bit more about you. How did you get into this? Where did you study? Where did you were you always drawn to cargo theft? Did you have a theft career and then you turned over to the good guys? No, I figured not. But let me know a little bit more. Let's talk about how cargo theft became this problem you wanted to spend your career working solved.

SPEAKER_01 5:43

Yeah, I uh I don't know that it's that interesting of a story or intriguing of a story, but I went to college and my goal was to become a lawyer. And so I went, I I had to pay for every penny of my own college. I got my four-year degree and then said, okay, I need to save some money up for law school and then decide where I could go to law school and afford to go to law school. And in that year off, I had all through college, I had driven truck. I drove flatbed for a building supply company full-time in the summer and then during school on the weekends. Prior to college, I drove a box truck in Buffalo, New York, where I grew up. And so I understood the transportation industry, the trucking industry, the paperwork. On that year off, I took between college. I was working security and doing some investigations, and we were doing security for a trucking company, and they had some stuff that was going missing in the warehouse. And my boss had me pose as an undercover employee on the night shift, and I figured out what was going on with that. And before he knew it, we were being asked to investigate some disappearing cargo at the time. And my boss at the time was like, Hey, you drive truck, you understand this stuff, and that you're going to be in charge of doing this. And I started doing it and I started doing investigations in general. And I thought, I kind of really like this stuff. And I ended up getting a full-time offer at a PI company, which is where I started, and took that and never looked back, and then ended up having a company with some buddies and then getting hired as travelers and asked to start the cargo theft team over there. So it just progressed, and it was just it was almost like something I just got caught up in. I ended up being good at it. I enjoyed it. I became passionate about it early on and said, Hey, I'm going to make a career out of this. And here I am.

SPEAKER_00 7:30

That's so interesting, too, to go from thinking that you were going to go to law school to then going into basically undercover agent where you got to really research things. I feel like it scratches that same itch that lawyers, that curiosity, tend to have, right? There's all these bad jokes about lawyers. But it ultimately it comes down to the kind of attention to detail, the wanting to learn more, the kind of wanting to dive into it. And early on, you were asked to do exactly that. You fast tracked the whole thing and got to be the undercover agent even within the own company. That's cool.

SPEAKER_01 7:58

Yeah, and and a lot of the investigations I worked back then, you mentioned it early on. I did, I was blessed to have a lot of really good mentors that were really experienced or really well-known investigators who took me under their wing, sent me to different schools, interview and interrogation schools. And I worked for one guy in particular that was really known very well for interview and interrogation skills. And he taught me a lot. And so I did a lot of embezzlement, internal crime, stuff like that. So I wasn't always doing cargo in the beginning. And that was actually very sporadic here and there, but I knew it and I learned it. I knew it and learned I learned it and knew it over time. It's probably the better order of saying it. But all the other types of investigations I did, I was quite often interacting with lawyers, right? And building cases and doing case strategy and being prepared for testimony and things like that. So to your point, I felt like I was living in both worlds a little bit, nowhere near being an attorney, and I don't even play one on TV. But, you know, I was living in that world where I was dealing with the bigger picture of it and dealing with attorneys all the time. And even today, you know, when you look at this company that I'm at, you know, I work with Justin Olsen, who was, you know, lead counsel for CR Logistics for years. And now was working with us at SPG, Cargo and Logistics, and he's he's a fantastic attorney. But and I, you know, in everything we do here, we talk to him almost daily, right? So I'm I'm always intermingling with that. You, you know, you and I become friends, and you're an attorney, Matt, you know, the the the transportation lawyer, you know. I'm always talking to lawyers and attorneys, so you know, and I didn't have to go to law school and I don't have to uh do all the paperwork that you're gonna do.

SPEAKER_00 9:42

You get to do both, you get to do both. I mean, it really is the best of both worlds. Yeah, Matt Leffler is a good friend of the show, the armchair attorney. He's he's great. And actually, how we met, he was teaching in Michigan State. Um he brought me on as a as a guest lecturer, and then I saw that he was doing a panel with you after, and I kind of snuck around and and stuck around and and listened in. I was like, wait a second, this is interesting. So yeah, yeah, everything comes back to Matt. We'll have to we'll have to tag him on the post here.

SPEAKER_01 10:08

He hasn't a little disappointed, he hasn't been wearing the jacket consistently anymore.

SPEAKER_00 10:12

The red jacket, yeah. So he he saves it for the conferences now.

SPEAKER_01 10:15

Right.

SPEAKER_00 10:16

Yeah, but no, um, I that's so interesting though, because it so even though you went into private investigations that weren't necessarily cargo, because of that trucking experience that you had, it probably kind of naturally combined the two. You saw that problem early on, small scale, but still, I mean, that's really how the problem has grown in the supply chain is it started small scale and it just kind of kept getting more and more sophisticated. So let's talk a little bit more about what you're seeing out there. I mean, you know, we we have this image of Fast and the Furious, right? The opening scene, and you have all these Hondas that are chasing this big truck and pulling, you know, getting all the cargo and all these uh, what was it, electronics or something out of the back? Now it's it's kind of less aggressive, but more impactful. And so we've seen that shift. When did that shift start to happen? And then and and then maybe we can go from there.

SPEAKER_01 11:06

Yeah, it's funny you mentioned the fast and furious scene. I used to when I would speak on this topic, I would start off by saying, you know, how many of you have seen the fast and furious opening scene? And everybody would raise their hand, and I would say, that's the only way that I've never seen cargo stolen in the United States, right? You know, great, fun movie, but not reality when it comes to cargo theft. So, you know, what the the real progression has been from strategic straight theft, sorry, to you know, dominating 97% of all cargo theft was straight theft for the majority of my career to now we've seen strategic theft, which used to be two or three percent, now being 30 or 33 percent of all cargo theft. That's been the real change. And and and I think it's really uh uh taken the industry by storm. I think it's it's interesting because as I said, straight theft is still 67 to 70 percent, depending on what quarter you're looking at, and everything like that, of all cargo theft, according to cargo net numbers in the United States states. But strategic theft goes a 1,475% increase in a three-year period. It goes from roughly two or three percent to 30 or 33 percent, and it gets all the attention right now. It's almost as though we're forgetting that straight theft is 67 to 70 percent of all cargo theft, and all we talk about is strategic theft. And I think there's several reasons for that. One, the level of sophistication behind strategic theft is so much that it occupies your thought process and your way. If you're if you're a freight broker, if you're an intermediary, you think about it all day. You know, you you think what's the new method? You know, what what's the new technique? What's the new weakness that they found in our system? I mean, it it literally must keep these freight brokers. I know a lot of my clients, I feel like it keeps them up at night all the time.

SPEAKER_00 13:16

Wow.

SPEAKER_01 13:16

Right. And so it gets a ton of attention. I think the other part of it is it targeted a part of the industry, the freight brokers, who traditionally did not have to really deal with cargo theft and did not have to be prepared for cargo theft. They were mostly, most of the time, they were witnessing cargo theft, either at the shipper and warehouse level or at the carrier level. And they had to help with the communication and getting to the bottom of the theft and like that. But they weren't the target of the theft because they didn't possess the freight, the truckers did, or the warehouse had it, and they were targeting the warehouses. You know, back in the day, you know, 10, 12 years ago, he would have four million dollars worth of freight in a warehouse on Friday, and the warehouse manager would come and open up on Monday, and the whole place would be empty.

SPEAKER_00 14:05

Wow.

SPEAKER_01 14:05

I mean, they would go in over a weekend, cut a hole in the wall, or cut a hole in the doors, disable the alarm systems, and empty out an entire warehouse over a weekend. We used to see huge warehouse thefts. We don't see that anymore. But the the the bigger point being, I think the strategic theft is attacking a part of the industry that was not prepared and didn't see it coming and is now scrambling. And it is hitting them with not one, two, or three methods, but 20 to 30 different methods every day. And you're trying to figure out what's coming next, and you're trying to train people to move freight as efficiently as you can, but hey, also, you know, make sure you don't have a theft, right? And and it's just really I mean, it's really made life difficult for the intermediary intermediary space. It's really hard to watch them deal with it. I mean that in a sympathetic way. I mean, I have clients who you know, I hate to see them get hit with this type of stuff because it just takes advantage of everything good about the industry.

SPEAKER_00 15:21

Yeah. Well, so let's break it down a little bit. Let's go, let's step back a bit. So, what are some examples then of straight theft and what are some examples of strategic theft? Just so that we kind of have it straight in our mind of, you know, there's still a majority of straight theft, which is probably pilferage and then the like. And then strategic theft that I've heard you even say you could be working for a company that is a total sham and you would never know it. So, what is straight theft and what is strategic theft and what does that kind of look like out in the wild?

SPEAKER_01 15:48

Straight theft is called that because it's straightforward, right? They're physically going out and taking it, they're they're stealing the tractor and trailer or the unmarried trailer and hooking up to it and taking off, or they're pilfering a lot, you know, opening the rear doors, taking two, three, four pallets off the back, things like that. So that's straight theft. It's very old school. You know, there's some slight nuances to some of the things that they do when it comes to tracking and seals and stuff like that. But for the most part, they're just physically going out and stealing it wherever it is. Truck stops, drop lots, parking lots, you name it.

SPEAKER_00 16:20

Opportunistic theft, really.

SPEAKER_01 16:22

Yeah, it is, but it's targeted also. They'll follow drivers out of distribution centers, they'll sit surveillance on distribution centers for days on end, tracking who comes in and out on a regular basis, you know, following loads out, things like that. So, you know, there's some there's some effort and and sophistication behind it on some levels. They'll plant members of their crew in warehouses as employees so that they have access to paperwork and know what loads are moving where and who's delivering what, and things like that. So there's some sophistication there, but for the most part, straight theft is straightforward. Strategic theft is when it begins with deception, when the when the theft begins through some level or some method, even if it's mire, of deception. And the most common methods are, you know, I'm a big stickler for the vernacular, right? It's straight theft and it's strategic theft. Those are the two buckets. That's it. Freight fraud is not a bucket. You know, I listen, I'm I'm fully on board. There is such a thing as freight fraud, but it's not a bucket. Freight fraud is a method of strategic theft. And and what that really refers to is MC number fraud, right? And a couple other uh small categories of fraud that exist in there. But so when you look at the strategic theft bucket, the most prevalent methods right now are double brokering scams, which we've seen an increase in those being involving email breaches, right? They don't need to do the email breaches. And when double brokering scams first came into the industry and really became prevalent, you weren't seeing a lot of email breaches in in the execution of those methods, but we see that and the majority of the time now with double brokering scams. And then the MC number fraud is probably the second most prevalent, if not right there closely with the double brokering scams. Identity theft is still out there, which is the second method of strategic theft ever to hit the United States. You know, when strategic theft came about in somewhere between 2010 and 2013 in the industry, and ironically, I joke about this. In 2013, DZ Patterson and myself stood in front of a room full of people presenting at JJ Southwest Transportation Security Council thing. And we said, Hey, we think this strategic thing is going to be a real problem in the future. And we kind of got laughed out of the room, right? We laugh about it now. Yeah, at the time it wasn't funny, but you know, people said, Yeah, you're overblown this, it's not that big of a deal. Well, the only method at the time was really fictitious pickup. And then identity theft popped up shortly thereafter, and it pretty much stuck with those two methods. And I was looking at some old numbers that I used for a presentation, and I think I want to say it was 2015 or 2017. Strategic theft finally, there was enough strategic theft for it finally to be reflected in the numbers. It was only like two or three percent. And then between 2021 and 2024, 1,475 increase, and it goes up to 30, 33, like overnight.

SPEAKER_00 19:28

Yeah. Is it is it kind of also in line with things moving from hard copies to paper? I mean, we're gonna get into kind of the the value that comes from actually being electronic and and kind of mitigating of some of the the cargo theft, but is that maybe why some of this some of the strategic theft was taking off and and you know the the falsifying of of people showing up and the the identity theft type thing? I mean, it wasn't securely locked down and maybe it was easier to access.

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SPEAKER_01 20:29

Well, we kind of talked about this before we came on, right? The the transportation industry, every day we see new technology in the transportation industry, right? And yet,

(Cont.) Cargo Theft Is Hiding in Plain Sight - a chat with the Cargo Theft Mitigation King himself, Scott Cornell

SPEAKER_01 20:39

what is the one piece of paper that dictates everything?

SPEAKER_00 20:44

The bill of lading. That's right.

SPEAKER_01 20:47

Right, and so all this technology that we see in the transportation industry, and so you have the bill of lading, which dictates almost everything, and the seal. And these two things have been present in the transportation industry for as long as I've been doing this, right? They haven't changed.

SPEAKER_00 21:06

Yeah, right?

SPEAKER_01 21:08

Seals have changed a bit, but uh the theory of a seal on a truck that hasn't changed, right? So nobody wants to break a seal, right? Because you have all sorts of problems when you break a seal, especially if it's perishable goods or consumable and stuff like that, or cosmetics, any of that kind of stuff, right? So nobody wants to break a seal, and you have a bill of lading that says what's behind that seal is televisions, right? And is it really? Yeah, nobody wants to break the seal to find out. Bill of lading says it's televisions. How is it you tell me, my friend, how is it gonna be moved through the supply chain? Yeah, as what? Televisions, yeah. Right? So so you know, when strategic theft first started coming around, and even straight theft, we saw bill of lading manipulation, paperwork manipulation, even insurance certificates, certificates of insurance, you know, were some of the most uh falsified documents in the industry for years, but the industry still works off of this type of paperwork for all the technology that we have, and that gives the thieves some advantage. So when you want to launder freight, you know, if you do a double brokering scam and you steal a load of uh television. And then you take it to a cross dock, and that bill of lating going into the the cross dock says it's televisions, but the bill of lading coming out of the cross dock says it's uh you know red plastic cups. Now it's a red plastic, it's a load of red plastic cups, right? And then if I take it to another cross dock or another warehouse and I and I bring it up and I label it as FAK freight of all kinds, that's what it is. And if nobody breaks the seal to verify that, I have a load of stolen televisions that now everybody thinks is freight of all kinds or red plastic cubs. And that's how it's going to get moved. And so it you know, it allows them to take advantage of the system and the way it works. And that's why I say I hate to see, you know, when I see my clients getting hit by some of this stuff, they're operating on a daily basis the way the supply chain's always operated, you know, with some you know great enhancements from technology and stuff like that. But the bad guys know how the supply chain works and they take advantage of some of the old school stuff.

SPEAKER_00 23:38

Yeah. Well, and that's interesting with the with the bill of lading. There is a movement toward electronic bill of lading. Do you think that's going to have a significant impact if we were to adopt electronic bills of lading across the supply chain?

SPEAKER_01 23:50

I think it'll have some impact. I don't, you know, I I don't know that I would state it'll be a significant impact, but it'll certainly have an impact. You know, it will, you know, it depends on how good the thieves are at manipulating digital bills of lading. Can they be manipulated? You know, how strong will the will the security around that be? But I think it's a step that needs to happen. And I think that, you know, when I deal with cargo theft on a on a daily basis, I could pick up numerous cases off the top of my head where if there wasn't an e-bill, they would they would have had to have done something different or they wouldn't have been able to commit the theft. Now, the one thing that I know and that everybody, every expert in my field knows is they will adapt and overcome. They just do. They are not going anywhere. You know, they you know, people say we need to end cargo theft. Unfortunately, cargo theft is never going to end, right? Can we reduce it? Can we make it difficult? Can we make them work harder for it? Absolutely. I definitely think it can be reduced. 100%, I think it can be reduced. But is it ever going to go away? No, it's never going to go away. Yeah.

SPEAKER_00 25:05

Well, and and part of that reduction of the cargo theft is is the overall awareness, right? The more people know the the trends to look for, the the current things that the bad guys are doing, you know, they can they can spot it, they can get that, you know, that that hair standing up on the back of their neck, and they can recognize that as something is going on here. And this is where I've heard you say many times before. That's where you reach out to to cargo theft experts right then. Because if you don't, you might lose your split second. I mean, it's not actually split second, but you kind of miss that small window.

SPEAKER_01 25:35

Timing is everything, right? I I mean, time is of the essence with cargo theft. You know, a lot of people say it's like that, you know, that TV show, the first 48 or whatever, right? But it's it's more than that. It's it's the first 24, it's the first five or six. You know, education, you know, and we take a step back and we talk about the first thing you touched on, which is education. Just look at, you know, you and I came together and I start uh speaking on the topic at the mica meetings and educating people on proto theft. How many of your members reached out to me after that, immediately when something felt wrong or whatever? And that was all based on education, right? Hey, we educated them on things to look for, things to be aware of, and hey, you have to reach out right away. So education is absolutely critical. You you have to educate your employees. You know, I just spoke about this. All too often in the company, we concentrate the knowledge around cargo theft or supply chain security in one, two, or three people. But they're not the people assigning the freight, working at the docks, handing the freight off to the trucking companies. They're not on the front lines, right? You know, imagine you know, the coach of a football team knows everything about football, but they don't teach their players the plays. Imagine how chaotic it would be on the field. This is that, right? If you are the expert in your company or it's your responsibility, your job, number one job, should be educating your entire team that target theft is a problem. Here's what you have to look for, here's what you have to be aware of. And whenever we do that, we see these kind of results where people start to pick up the phone. Now, when you when you continue on the conversation, you talk about timing, time is of the essence. A few months back, I had a friend call me and say, Hey, I have a load, I think it's a double brokering scan, and it's a high value load, and I need your help. And I said, Okay, you know, when was it picked up? It was only a matter of hours, right? Like half a day. And the driver was giving him one location. I started to get involved. Um, you know, we figure out the real location of the driver. I reach out to some law enforcement contacts I had, they responded immediately, thankfully, and they rolled up on them as they were offloading the freight. Wow. 30 minutes later, then we would have missed the look.

SPEAKER_00 28:07

Yep.

unknown 28:08

Wow.

SPEAKER_01 28:09

Right? 30 minutes. And so that's how tight it can be sometimes.

SPEAKER_00 28:13

Yeah. Well, and the other thing too, I mean, even just once they've offloaded, this is something that you've said, the the top three categories are energy drinks, alcohol, and meat and perishable, you know, kind of protein. And and one thing that really stuck with me is a lot of times, you know, you take off a label, that meat doesn't have a QR code itself or or or a UPC, right? I mean, those are like once it's repackaged, that's gone. And and the other scary part of that is, you know, if that's if that's seafood going out there, you don't want seafood naturally in the wrong hands, and then all of a sudden getting into the common, you know, societal food chain or you know, alcohol or or beverages of that matter. You you you kind of trust that it was always in in the right hands. And so having this this cargo theft happen on these types of goods and and for them to be the highest hit commodities.

SPEAKER_01 29:02

Yeah, it's you know, they love perishables for you know, they love that food and beverage category, right? We saw that come into the number one spot in 2010, and it's been there, you know, when all things are normal, it it'll be the number one thing. Now we've seen some shifts here and there around COVID and stuff like that, right? But but when all things are normal in cargo theft, food and beverage is gonna be your number one targeted commodity. Why? Because what happens to the evidence, it's consumed, right? It's hard to trace, it's easy to move. And also, they know how the industry, the bad guys know how the industry reacts to cargo theft. Meaning, even if I recover your load of meat and the seal's broken, what's gonna happen to it? We're gonna destroy it. Right? Somebody's gonna want it destroyed. They're not gonna want to put back in the supply chain tier point. So they know that, and they know that as a result of that, the industry doesn't pursue a load of meat or seafood as long as they would, or as hard as they would pursue a load of televisions or tablets or gaming consoles or metals or tires or any of that kind of stuff.

SPEAKER_00 30:14

That's interesting. And I I I it and maybe this is true, maybe it isn't, but it feels like at least in in the very, very short time that I've been even paying attention to all of this, it feels like there is more of an effort to pursue. I mean, it's it's all margins related, but it feels like there's more of an effort to pursue some of these perishable commodities only because then it can help prevent the next theft, right? And so, you know, trying to kind of get activated on what's happening, understanding the whole system a little bit more, and then using that to prevent whether it's you getting involved to learn what's happening and learn the trends. But then also it feels like the shippers and the and the cargo owners are kind of following suit in there.

SPEAKER_01 30:56

Yeah, I think that you know the industry is to a boiling point with cargo theft. You know, they've just gotten to a point where they want to see bad guys go to jail, they want to see cargo theft reduced. So we do see, I think, a good, you know, stick with it type mentality, even when, you know, if I go back to some of the mica members that I've worked with, there's a mentality, hey, we want this bad guy caught. You know, even though if you recover the load for us, God, we're probably gonna have to destroy it or whatever, we want the bad guys to go to jail, right? And, you know, recently NYPD and some federal agencies had some really big busts in New Jersey. I had some really big busts over in that northeast area. And, you know, I was told directly that some of the interaction that your members had with law enforcement and some of the information that they supplied helped in that major case and and resulted in some of the arrests that did have happened, right? Or partially resulted in some of the arrests that have happened. And that's great to see, right? It's great to see that mentality in the industry of, yeah, I might not ever, you know, get made right on this load, but I certainly want to see the bad guys go to jail. Right.

unknown 32:09

Yeah, yeah.

SPEAKER_00 32:10

Well, and it's kind of this we're all in this together, right? And you know, the bad guys are banding together, the good guys might as well band together to try to combat them. So, you know, I want to go back a little bit to the electronic build of lading and and certainly kind of the technological advances there. AI. How do you think that AI can be used for tracking trends and certainly kind of scanning systems to see anomalies and identify them? Is that something that you think might have an opportunity here? I mean, on the one hand, we are still a paper-based industry, the entire supply chain. So we're gonna have to move from paper-based in order to have AI really kind of be helpful there. But, you know, on the one hand, you might say bills of lading, paper bills of lading, if they are being modified, now they can be modified with a little bit more, higher level of authenticity, you know, faking. But on the other hand, too, can we use AI for good to try to monitor and scan for those trends?

SPEAKER_01 33:09

So the AI topic has been a big question over the last couple of years. And I am certainly not an AI or cyber expert, right? I have a working man's knowledge of it as it relates to cargo theft and you know what I see with it. Something I've been saying for a while is in the end, it's gonna be AI versus AI when it comes to the use of AI, right? It's gonna be who's better at the use of AI, who's better at training AI to detect it or block it, who's better at training AI for nefarious reasons to breach systems. And I think one of the things that people may not realize well enough is that when you look at the fact that strategic theft, you know, when we saw that massive increase in strategic theft here in the United States, it was not driven by local crews, that was driven by international crime rings operating from over a dozen or two dozen different countries, pulling the strings and using strategic theft as their method of choice because they could be anywhere and target freight anywhere. And in doing that, they like to use technology. I mentioned earlier with the double brokering schemes, we see a lot of use of email compromise, social engineering, phishing emails, things like that in that method and in some of the other methods too. So AI is a natural tool. And a lot of those, you know, even when you talk about the phishing emails and social engineering emails, they use AI to generate those. They use AI to send those out all day and barrage your employees with them all day, every day, right? And so, you know, AI is definitely becoming a thing in this, it will definitely play a role, but the use of AI to block it and combat it will also become significant. So that's going to be something that I think we absolutely need to keep an eye on. And I think, you know, going back to my point about this being perpetrated by these international rings, you know, there's a lot of speculation that some of those rings have ex-military people from other countries in there, you know, cyber, you know, ex-military people that were cyber experts involved in this and everything like that. So I feel like it could become, you know, a very advanced part of all this. Jury's still out. We're still watching it mature every day. We're watching it used more, certainly to your point about manipulating documents, absolutely, all day. You know, we definitely see the use of that, but also to create fake driver's licenses, to manipulate driver's licenses and identification, things like that. So we've even seen that uh they use it to disguise their voice, right? So if if a bad guy from another country is calling somebody in Tennessee, they'll put a Tennessee accent with the use of AI. So they sound like they're local, or they're put a southern accent, or you know, if you're in the northeast, they'll put you know, a New York or Boston or Brooklyn accent on, things like that. You know, my my father's from Brooklyn. I always say there's a difference between a Brooklyn accent and a New York, New York accent, right? Things like that. So and people people can detect it, right? So yeah, AI is definitely going to become a problem. So it's really gonna be about how can we use AI to combat that.

SPEAKER_00 36:37

Yeah. You know, I want to go back to the MC numbers. We we talked about that a little bit, and this is something that I've heard you talk about before, where there are some of the bad guys out there going out and they might buy up 200 MC numbers and they'll use a hundred of them for a legitimate business purpose for a while. And this industry, supply chain generally, I feel like is so built on trust, built on relationships, built on, you know, kind of it feels like integrity and honesty, right? Like kind of all the old tenants of just good old business. And and they'll use that against people in the industry where you don't even know that on the, you know, last Saturday they were burning an MC number by by trying to go grab a load through a street theft. So talk a little bit more about that. And that's the example, I guess. I remember you've been saying of you can sometimes work for these companies and not know that you are being part of a long-term plan set up for theft.

SPEAKER_01 37:31

Yeah, they're very cargo thieves are very patient, right? And they always have a plan and a strategy in place. They don't, they a, you know, straight theft a lot of times can still be opportunistic, sometimes planned, as we talked about earlier, but strategic theft is always very planned. And when we first started seeing the purchase of the MC numbers, you know, Jeff, the late Jeff Hall, God rest his soul, was a dear friend. You know, and I always go back to the story where you know he he called me one day and he said, Hey, I have an informant. He's got some really interesting information. I want you to hear it because I need your thoughts. And we talked to a guy who said, Hey, so-and-so just purchased, you know, 400. I think it was, if I remember correctly, I think it was 412 MC numbers. And he goes, I'm not sure what he's gonna do with it, but I know it's not gonna be good. I thought you guys want to know. He gave us some of the MC numbers that he knew of, and he got off the phone and Jeff and I were talking, and Jeff said, What do you think? And I said, I would take half of them and I would operate normally and gain people's trust with them, and I'd take the other half of them and I'd go steal with them. And then when I burned all those, I'd flip the switch on the ones that people are are now trusting and I'd steal even more loads. And sure enough, that's exactly what happened, right? And Jeff agreed. Uh, we both we both were on the same page as as usual, and that's what we've seen over time, right? And uh, and I just the other day I was looking at a case, Gary Thomas and I were looking at a case where we think that's exactly what happened. You know, the company said, Hey, we've been giving these loads to this company for months. We've had no issues. And as far as we could tell, the MC number was purchased months ago, not recently, right? But one of the loads just went missing. You know, it's a very, you know, high value load. It's not, it's not one of mine or anything like that, but it's somebody who reached out to me for help. And as you know, as far as we could tell, they purchased the MC number months ago and they've been holding and delivering the loads, you know, for months so that they can get the routes, the communications, paperwork look like, how many questions are we asked, you know, how many loads are we going to get assigned, all these things. And then then they just one day decide, okay, let's start stealing them. You know.

SPEAKER_00 39:47

That's wild. It's so wild. I mean, so and and it can be that easy, right? For the transfer and buying and selling of MC numbers. So there is a little bit of of an effort going forward to try to solve that. There is a larger effort going forward on the Hill under the CORCA bill. So that's the Combating Organized Retail Crime Act. That is really interesting. One of the things that you've talked about, and we'll dive into this a little bit more later, but is the cargo reporting numbers and the inconsistent kind of offenses that they sometimes get categorized under. And so it can be hard to accurately track how many cargo thefts are happening because it might be reported as a general theft, or it might be recorded as a freight fraud, or it might be, you know, whatever the different police department has, they might be recording it differently. Speak to that a little bit and then we can jump into to CORCA.

SPEAKER_01 40:38

Yeah, there's really no reporting category for cargo theft for law enforcement unless there's a state one, right? Like California has some of their own state statutes, you know, different states have some of their own state statutes, but there's no federal reporting category for it in the UCC uniformed criminal reporting system, right? And so a law enforcement officer in Iowa who has never worked cargo theft or, you know, not picking on Iowa, North Dakota, South Dakota, you name it, that don't really deal with cargo theft, they may they may report it as an auto theft, right? Because technically there's an auto involved, right? And another law enforcement officer in another state may report it as some kind of property crime, you name the category. And so the numbers get diluted. The cargo theft numbers have have, for years, been diluted into all these other categories of crime. And so when you look at the numbers that are out there, I always use cargo net. I still think it's the best resource. They did they do the best trending. There's a couple other companies out there that do that as well. But you know, I'm I'm a big user of CargoNet for the numbers and the statistics. And I think that when you look at their numbers, I think you're getting a sample size. I think you're getting, you know, I've always said, and I and CargoNet has never corrected me or disagreed with me, I think you're getting one tenth of all full truckload thefts, one fifteenth of all cargo thefts if you're including pilfridges. Right. And so, you know, if you get a report from them that's 4,000, just using an easy number, if you get a report from them, an annual report that's 4,000 or 3,600, they think it was the last one or 3,700, multiply that by 15, I think you're in the neighborhood. Right. There's been a couple of articles that have come out recently stating that the cargo, that the cargo bill is not necessary because cargo theft's being overblown. And, you know, when you look at the numbers, the cargo net supplies, you know, they're minuscule compared to the amount of loads that move across the country. Well, those people that wrote those articles, they obviously didn't do their homework. I mean, the first question in my mind would be why am I getting these numbers from a company called CargoNet and not from the federal government? Right? Well, because the federal government doesn't track it. Right. And so, okay, and then if I look at the cargo net numbers, which again I'm a big fan of, they give us good trending, I find out that it's based on voluntary reporting. And that tells me right there that I'm not getting all the cargo thefts. Right. And, you know, when the article says, well, all cargo thefts are reported to law enforcement, I agree. I think the majority of cargo thefts are reported to law enforcement. But I go back to my earlier point, they're not being categorized as cargo theft. So we don't know what the cargo theft numbers are that are being reported to law enforcement. So the CORCA bill is important because one of the key things it does is it mandates that the federal government track cargo theft in its own category. And so I think that's uh that's one of the most critical parts of the bill.

SPEAKER_00 43:34

Yeah. Yeah. And and when I've talked to non-cargo theft, even non-supply chain people, just people on the hill or people in DC generally, they're surprised to learn that there isn't a good method for tracking this because it is becoming such a hot button issue for everybody. And once we get some real handle on the numbers there, then we can also get a handle on the loss and and the the cost that it goes to, you know, every average, everyday average consumers that are out there. I mean, this is probably, I mean, it's it's got to be in the 10, 25, 50 cent, maybe a couple dollars worth of savings of of how much cargo theft is happening. We just don't know, right? That we we don't have good numbers to base those those analyses on.

SPEAKER_01 44:16

Yeah, well, again, if you take the cargo net numbers, I think last year's annual report had the uh dollar figure somewhere around 730 million. Wow. So if I'm right, and we've all And we just go by full truckload and we multiply that number by 10.

SPEAKER_00 44:34

Yeah.

SPEAKER_01 44:35

It's a pretty significant number. That's right.

SPEAKER_00 44:37

Yeah. And if that had been entered into society appropriately, you wouldn't see the losses with the companies. And then the the overall consumer product number, you know, dollar amount that you'd be paying at the wherever you're buying would arguably be lower.

SPEAKER_01 44:51

Well, an important part of that too is that's not even the real number. Meaning, you know, so TAPA, which I, you know, I'm currently lucky to serve as the chairman of TAPA. We're in the process of vetting some universities that we may work with to create a study for the industry on what is the true value of a cargo theft. Because the industry really doesn't know. And we think that's a valuable tool to bring to the industry. We're just going to donate it to the industry. We're just going to create the study with the university of our choosing, and we're going to give this study out to the industry. Because, you know, the example I always give is let's say you're moving gaming consoles in November, Christmas season, right? And you have a load of gaming consoles stolen. And let's say the retail value on that is labeled as 400,000. Just using the easy number. Is that the value of that load? No. Now you're not on the shelf next to your competitor. So your competitor probably gets the sale versus you, right? You know, you have to remanufacture those. You have to reship those. You have to put an insurance claim in on those. You have costs to investigate those. So it's not a $400,000 loss. It's 3X that 2X that 4X that whatever the formula ends up being that we figure out when we do that study is going to be critical to the industry because that $730 million number is the retail value most of the time, or the invoice value, right? And so it doesn't even scratch the surface on what the true value of the cardboard depth is. And to your point, all of those costs are passed on to you and I. We're paying for all that, right? And when you when you look at food and beverage is the number one targeted commodity in the country, and people say, look at the price of groceries. Yeah.

SPEAKER_00 46:53

Yeah.

unknown 46:53

Yeah.

SPEAKER_00 46:54

It's not the only thing that'll bring it down, but it certainly will have an impact with these numbers that we we just don't have a good handle on. So you know, even further reason why it's so damaging having reports come out that say cargo theft is not a real problem or not as big of a problem as people say, because ask any shipper out there, and if they haven't been hit yet, yeah, hopefully they won't be hit, but they're thinking about it, like you said. And and all of the intermediaries that are working the load movement. I mean, they are, like you said, losing sleep over this. So, you know, unfortunately, it's something that is happening far and wide and something that's impacting everybody in the supply chain in one respect or the other. You mentioned TAPA. I do want to give you a moment to talk about TAPA, talk about the value, talk about the benefits. So you are the chair of TAPPA America's uh Transported Asset Protection Association. Tell me a little bit more about TAPA and what it does.

SPEAKER_01 47:44

It's a fantastic organization. I've been involved in it, I think, for 14 or 15 years. You know, worked my way up from just being a member to being on committees to being on the board and now, you know, lucky enough to be the chairman. And I served as vice chair for four years under Alan Gere, who was a great chairman. And it's a nonprofit organization. And I always like to make a point of that because, you know, we don't have a commercial angle. We're not trying to profit or make a bunch of money off of people or the industry or anything like that. And, you know, the the biggest thing we do is we bring supply chain security standards to the industry. So we have the trans the TSR transportation security requirements, the FBSR freight broker security requirements, cyber facility. We're coming in with parking standards, things like that. So we create those standards for the industry. You can get TAPA certified on those standards. You can use that to generate business, showing that you're, you know, you take security a bit more serious than everybody else, right? And and use that to kind of stand out in the industry. We also host the two largest cargo theft summits in the country, the National Cargo Theft Summit, which takes place in May. This year we did that in Atlanta, and it looks like it'll be in Atlanta for the next three or four years. And the T2 Solutions Summit, which takes place in Phoenix this year, November 11th and 12th. So watch for that to be announced and get on the list for that. And if you're a member, you get to don't quote me on this because Cindy always yells at me and give it a form. But I think if you're a member, you get to bring four people to each of the summits for free as part of your membership, right? And then if you want to bring more, you have to pay. And, you know, the organization is led by some of the brightest minds and some of the brightest people in this field. You know, you have the head of security for some of the largest freight brokers, trucking shippers in the country or on the planet serving on this board. And so I'm flattered to be working with those people, just a tremendous pool of knowledge that manages that board. You have Cindy Rosen, who's our executive director, who's really the backbone of the whole thing. Like uh, you know, she she just makes her and her team keep the whole thing running and spinning and everything like that. But you know, this last our membership has grown. So if cargo theft isn't a problem, why has our membership grown over 30% for the last three years? Why is why is every summit that we host standing room only? Right? You know, why every time I speak about cargo theft, um, you know, and I say, you know, you know, if six, seven years ago when I would speak, I'd say, hey, everybody in the room that's had to deal with cargo theft, raise your hand. Maybe 10 people in the room raise their hand. Now I have a room of 400 and 80% of the room raises their hand, right? Why is an organization like Micah reaching out to me about cargo theft? Why why does the TIA do so much for its members around cargo theft, right? And the ATA and the TCA and all these other organizations. So yeah, TAPA's a fantastic organization. There's a there's a if you're a global entity, like I know you guys deal with a lot of shippers and ocean marine, there's TAPA Americas, there's TAPPA AMIA, which is our our sister chapter, which is you know covers Europe, and then TAPA APAC, which covers the Asia-Pacific area. So anywhere on the planet that you move freight, you can be covered by TAPA and be a member of the most relevant or all of the chapters, so that you can be up to date on the latest Intel. You know, we have Intel services, we have tracking services, you know, data tracking services, we have alliances with companies like PargoNet that provide data to us, stuff like that. So TAPA is a great resource for education. We do all sorts of webinars. We have a law enforcement committee that works directly with law enforcement, liaisons with law enforcement. Our last summit, we were over 400 people in attendance, and we had our largest law enforcement class of 65 attend. And that was federal, local, state, you know, regional, Canadian. Um right. So yeah, it's a great organization. If you're not a member and you're dealing with the supply chain and supply chain security, you absolutely should be a member.

SPEAKER_00 52:03

That's great. And and that's so key, too, to I mean, beyond all of the benefits, just facilitating all of those stakeholders in the same room, having that conversation, you know, the biggest conference you set of this kind, and you have it twice a year, getting those people in the room so that they are current and relevant and sharing information on trends that they're seeing too, so that you can see, you know, if somebody has a, you know, we're starting to see this one little funky thing next year, you know, 30 people have that happen and you can watch those trends in real time. So really, really fantastic group. And one thing that I've seen from from engagement with TAPA is just the the sheer education value too. You know, the things that not everybody is at stage 100, right? A lot of people are still at step one, two, three trying to learn, okay, I know that this is a problem. I just want to get a little baseline. You have some of that education online already. And so TAPA is just such a great first stop if you're you're kind of trying to figure out look, cargo theft is becoming an issue for me. I don't necessarily want to go out there and tell all my customers that it's a problem, right? That we've seen that where some companies don't like to be named because they don't want to admit to having problems or don't be somehow seen less capable than their competitors. Look, everybody has a cargo theft problem these days, whether they've been hit or not, right? Everybody is making mitigation efforts or should be. And if they're not, you know, that that's a problem too. They should be cutting edge on the educational side of things.

SPEAKER_01 53:26

Yeah, it's, you know, it with the rise and the sudden rise of cargo theft, a lot of in a lot of companies, you know, people that were really safety managers are being given the, you know, you're not responsible for cargo theft, too, right? And we get a lot of that uh in the attendee group of people who are, I was just given this responsibility with my company. I don't really know anything about it. Somebody directed me to TAPA. I'm super glad I came to this conference. It was super, it was, you know, very educational. I made a lot of contacts. You know, that's that's one of the great things that comes out of these summits, too, is you get to meet the law enforcement people that are trying to find your freight or put the bad guys in jail. And law enforcement finds a lot of resources, you know, people that can help them with understanding how some of the freight moves or getting paperwork or getting contacts with other companies. You know, there's times when law enforcement hits warehouses, right? And there's millions of dollars of freight in that warehouse. And it has to get moved, right? And you know, sometimes I've had law enforcement reach out to me and go, can you help help me get this moved? And I reach out immediately to one of the members of the board and say, you know, who's head of security for a big trucking company and say, Hey, this is what's going on. Can you help them? Yep, we'll get trucks over there, you know, within an hour. Right. I mean, that's the kind of collaboration you get by being part of organizations like this.

SPEAKER_00 54:57

Yeah, that's great. Well, and I've I've heard nothing but fantastic things about about your TAPA conferences. So applause to you guys for hosting just fantastic opportunities for those conversations. So, you know, we we've we've talked a lot about kind of the full supply chain here. A lot of things that my members are dealing, or excuse me, my members, my listeners are dealing with is that interchange between the port itself, the carrier dropping off the load onto the yard, but then where the problem starts to creep in is not within the yard, but it's once it starts to leave the yard. The ports themselves have really great security mechanisms, but it's that interchange piece. So let's talk a little bit about that, that drayage component, but then even sometimes the warehouse. What are some things to look for? Where are some kind of pinch points or pain points or or you know opportunities for convenience opportunities for theft? Uh talk about that piece.

SPEAKER_01 55:49

Yeah, the weakest, the weakest link in the supply chain right now is the the point of exchange of the freight, right? Where the shipper is handing it to the carrier. That's the weakest link right now. And that's why when you look at the cargo net numbers and it says where is cargo theft happening, it says warehouse. That's not warehouse break-ins, that's the freight being handed off at the warehouse. Right. And shippers need to get more involved in this. And we are seeing several big shippers really start to take notice and realize that they play an important role in this and they have to pay better attention to who are they actually handing the freight to at the dock? Who is showing up at their dock? Are they helping to verify those people? Are they cooperating with their freight broker and everything like that? You know, if the freight broker tells you ABC trucking is coming to the dock and XYZ trucking shows up and just says, Well, I'm here on behalf of ABC Trucking, just stop. Just stop for a minute, right? And you know, people say, Well, you know, we're trying to move freight quickly. And I always say, What's going to slow you down more? Picking up the phone, calling the freight broker, and verifying, or having a theft and having a deal with that theft for the next 30, 60, 90 days. Right? What's going to slow you down more? So shippers, we really need to see shippers take a more active role in that exchange of freight and the security aspects around that and the verification. There's some really good tools coming out. You know, one we talked about earlier, a company called uh Verified Carrier that not only helps vet carriers, but they also have a product called Verified Pickup Now, which basically tells you yes, this driver is the right driver, it's the right truck, they're insured, they're they're they're with the company that was vetted, things like that. It's a great tool. There's a couple other companies coming out with similar tools like that. But there is a movement in the industry towards different technology, different tools like that. And that's critical. Again, there has to be a human touch, there has to be some human intuition involved in all this, but tools like that are great tools. I think when it comes to the ports, you know, you're 100% correct. You know, since 9-11, really, the ports are locked down. We don't see, you know, there's pilfrids that happens at the ports here and there. We don't see a lot of full outright theft at the ports. But again, there's some weaknesses in the exchange or the handoff of some. You know, auto haulers are getting hit really hard right now by theft. And we've seen some incidents where people are able to easily fake, you know, that they're the right person to pick up this vehicle from the port, right? And the vehicle's handed off to them, things like that. So there's a little bit of weakness there. But you know, I think there's also, you know, we talked earlier about our people losing track of the fact that straight theft is still the number one method of cargo theft, drainage is an important part of that, right? Because if you're a trucking company and you have a pool of designated drivers that have Twit cards that go in and out of the pork for you all day, a lot of times what companies will do is they go in, they get that load, they bring it out, they drop it in a drop lot outside the port so that another driver can come pick it up, take it to the distribution center or the warehouse or its final destination or whatever. Well, a lot of those drop lots are not secure in any way, shape, or form. They're commingled, meaning there's three, four, five different companies using them. There's no control over ingress and egress. And it literally becomes a buffet line for cargo for the bad guys. And they will just in broad daylight go in there and hook on to a load and off they go. And it becomes very easy for them. So we do see cargo theft and draids. People think, well, it's only a short distance, it doesn't go very far. So they probably don't see theft. We see plenty of theft in that space.

SPEAKER_00 59:30

Yeah. Well, and that makes sense too. A little bit of convenient shortcut, right, can then create that crime's convenience opportunities, right? That they just see an open lot where they see a lot of, like you said, unmarried truck trucks and and just sitting there ready to the the cargo loads ready to be pulled by somebody. So and and nobody really monitoring it. But because you're in eyesight, you know, maybe you kind of have this false sense of security. Um, but but you're outside the perimeter of the of the security of the port. So, you know, that's interesting though, what you were saying about the the cars coming in and and you know, maybe even project cargo, but those one-offs. So there's a system in place, right, for drage providers to have the Twit card, but those one-offs, and I think that that's something that ports probably do need to pay a little more attention to, it's probably still rare, but as with any rare cargo theft, you know, component, it once they see an opportunity that's successful, they're they're gonna pounce on it, continue to pounce on it.

SPEAKER_01 1:00:23

Yeah, they pressure test methods all the time, right? And once they find success, they just keep coming, right? I always say they're like water running down your roof looking for a crack, right? And they find that crack and it just starts to pour in. Yeah, and and that's really how they operate. So I think it's important that these things be paid attention to. And listen, when it's a 200, you know, they're not going after the $30,000 car, they're going after the $250,000 car, you know, the $300,000 car, the $500,000 car. So, you know, those are not small hits.

SPEAKER_00 1:00:50

Yeah, yeah. Well, and you know, uh, we you'd mentioned the the New York, New Jersey, and and some of the the big cargo theft rings. I think it was the Godfather's cargo ring that was, you know, reported or or how I saw it sensationalized. And when we talked shortly after that happened, and and you had said, you know, there was some some work from some information from some of the members of the Meat Import Council that had helped with that. The other thing that you said that really kind of stuck with me is sometimes hit or captures like this can also be a bad thing. I mean, they're obviously a good thing, but they can sometimes be a bad thing because then they want sometimes the bad guys want to show you you didn't actually get us, right? And so then you have to be extra prepared. You can't let your guard down. You have to be extra prepared for the next thing that they might try to do to show you you might have gotten five guys, but you didn't get the 50.

SPEAKER_01 1:01:41

Well, this goes back to you know, the head of the snake is overseas. So the people that are being arrested around here are really, you know, regional managers and and and and worker bees. Right. And that's not, I mean, law enforcement's doing a fantastic job with these, right? But it's difficult when the head of the snake is overseas. And ironically, with some of the big busts that we've seen recently, the week following or the two weeks following, we see an uptick.

unknown 1:02:07

That's wild.

SPEAKER_01 1:02:08

In fact, and it's almost like they're they're taking revenge, or you know, they're angry and they and they and they just lash out at the industry on it, or they're trying to say, you know, you got some of us beating at all of us, right? And so, you know, the first quarter numbers from CargoNet, you know, a lot of people said, well, oh, this is the first reduction in cargo theft that we've seen in a while. It wasn't. That was a lot of people reading the data incorrectly, right? Meaning there was a reduction in reported incidents. CargoNet tracks all incidents, whether they have an actual theft tied to them or not, meaning it could be suspicious activity, it could be a failed attempt, you know, all that. So incidents went down, but incidents involving cargo theft went up. So all these arrests, which you know, God bless our law enforcement officers out there on these task forces and all across the country, NYPD, New Jersey, CTIPS, LAPD, all these other task forces that are just making bust after bust lately. They're fantastic groups, and they're and they're doing yeoman's work. But cargo theft hasn't gone down. It hasn't gone down.

SPEAKER_02 1:03:22

Yeah.

SPEAKER_00 1:03:24

So one last kind of obtuse question. What is the wildest cargo theft story you have? And maybe it's not even the wildest one, but what's the wildest one that you can share that maybe in recent memory? Or wild one?

SPEAKER_01 1:03:37

I don't have a wild one because everybody thinks that oh, they're all crazy, right? I think you know some of the high-tech ones we're seeing lately are a bit crazy, right? I mean, we see $30 million memory module server equipment stolen, right? And those loads are double brokered, triple brokered, quadruple brokered. Like, how are we letting that happen? Yeah, that's some wild stuff, right? But a funny one that I always go back to that's a bit nostalgic, was years and years ago, you know, I had probably been doing cargo theft for 10 years, and I thought I knew it all, and I thought I'd seen it all. You know, I was young, and I was like, I know everything about cargo theft. And you know, I know what they steal, I know what they won't steal. And my buddy called me up and he goes, Hey, we have a load of stolen pigs. And I said, You mean ham? And he goes, Nope, live pigs, load of stolen live pigs. And I said, You're kidding me. Nope, load of live stolen pigs. So we end up recovering the load.

SPEAKER_00 1:04:36

Wow.

SPEAKER_01 1:04:37

And I remember thinking to myself, I will never think that I know everything about what will be stolen and what won't.

SPEAKER_00 1:04:45

They're like so funny.

SPEAKER_01 1:04:48

So lesson learned, right?

SPEAKER_00 1:04:49

Oh, that's wild. That's wild. So, all right, last last question. If any listener listening here, and this is broad category, what do you do when you start to suspect a cargo theft? There, you know, let there's probably people listening now who are thinking, you know, just the other day something felt a little off. What do they do, right? That's always the disconnect. How do they take that first step?

SPEAKER_01 1:05:11

Before you have that theft, you have to have a plan. If you don't have a plan on what you will do, you will it will be miserable for you. You know, it will be miserable for you. I go back to my football analogy. Imagine me, I've coached football for decades. Imagine me not having any practices and not having a playbook, showing up, Friday night lights. Hey, we're gonna draw plays in the dirt right before the game, and we'll see if they work. It's not gonna go well, right? So you must have a plan in place. This is what we will do if we think we have a cargo theft. Now, when you have that cargo theft, you have the first thing you have to know is who to call. You know, you have to know how to file a police report. A lot of times filing police reports is one of the most difficult parts of that response, right? Getting law enforcement to understand what happened. Know the experts to call. You know, I always offer, like, I've offered your members and stuff like that. Like you can reach out to me. You don't have to be my customer, I'll help you. I'll get you hooked up with the right people or give you some direction and stuff like that. And that's just because I can't stand the bad guys and I want to see them lose, right? But know the task force numbers so that you can call the task forces directly. If you have a theft in California, you want to talk to a task force member, right? And get direction from them. If you have a theft in New Jersey, you want to talk to a task force member, you know. So know who to contact, respond immediately. Don't take anything for granted. You know, if they tell you, oh, we're having a mechanical failure, unfortunately nowadays, that's an indication that they're trying to delay you from responding to a theft. So if it ends up being a mechanical failure, great. That's actually a good day in today's world. Right. If it's not a mechanical failure, you need to be involved right away. So don't hesitate. Respond immediately. Get involved. Know who to call.

SPEAKER_00 1:06:57

Yeah. Well, thank you so much for your time today. Thank you for explaining and walking through and illuminating the really mystical world it feels like sometimes of supply chain. You know that it's happening, but you don't really know what to do about it. And hopefully this has helped some of the listeners to learn a little bit more about what to look for. They know, know that Kappa has some resources to continue the efforts on learning more about it, to make those plans and to really kind of understand it that they have a game plan in place. So great, great advice overall. Well, thanks so much, Scott. Great to see you. And we'll be we'll be seeing you out there. Stay busy because that means you're getting the bad guys.

SPEAKER_01 1:07:34

Yeah. Thank you.

SPEAKER_00 1:07:36

A big thank you to Scott Cornell for joining me. I think one of the biggest takeaways from this conversation is just how different modern cargo theft can look from perhaps the traditional image that most people have in their heads, right? Sometimes it is still just this trailer that's stolen from a parking lot or cargo physically taken from a truck. And actually, more often than not, it's still that. But increasingly, it is this identity theft, fraudulent paperwork, compromised accounts, legitimate drivers being manipulated into delivering the shipment directly to the criminal. And when those crimes cross companies, states, and jurisdictions, it becomes much more difficult for any one investigator or agency to see that full picture. Isn't that wild that we don't have really great numbers on how much cargo theft is actually happening out there? Look, that's where the work of organizations like Tap Americas comes in, bringing together cargo owners, carriers, brokers, insurers, security professionals and law enforcement. It's also why Scott and others have been pushing for this Corka. Many, many, many people in the industry are looking at Corca and really fully supporting it. And hopefully we get it passed and through so we can have some real reporting, some real numbers, among the many other benefits that Corca will provide. Perhaps a more coordinated federal response as well. Look, I really enjoyed having Scott on. He is the king of cargo theft mitigation out there. I encourage you to follow him and really, really listen to what he has to say because he has lived and breathed this for quite some time now. If you like this episode, be sure to follow, subscribe, and leave a review. Want to go deeper on these topics or bring this kind of insight to your team, visit themaritimeprofessor.com to explore corporate trainings, tailored briefings, and on-demand webinars, all designed to make complex maritime regulations practical and easy to understand. And if you or your organization needs help navigating the legal or strategic side of ocean shipping, head over to Squall Strategies. That's where I provide consulting services, regulatory guidance, and policy support for clients working across the global supply chain. As always, this podcast for educational purposes only and should not be considered legal advice. If you need an attorney, contact an attorney. So until next time, I'm Lauren Began, the Maritime Professor, and you've just listened to Byland and by C. See you next time.