Latest news with #CombatingOrganizedRetailCrimeActof2025
Yahoo
30-04-2025
- Business
- Yahoo
Trucking, rail implore Washington to help fight cargo theft
WASHINGTON — As monetary costs and safety risks rise in proportion to the increase in cargo theft, freight carriers are upping the pressure on lawmakers for a more coordinated government response to combat the problem. For the second time in two months, representatives from the trucking and railroad industries participated in hearings on Capitol Hill focused on the problem, which shows no signs of going away. 'Trucking companies are either victims of cargo theft or they're spending so much money to avoid being a victim that they're also a victim,' said Bob Costello, chief economist of the American Trucking Associations, at a roundtable discussion on Tuesday hosted by the House Transportation and Infrastructure Committee. 'We have issues with [the Federal Motor Carrier Safety Administration's] registration system, so when we go into it my members can't tell if it's a legitimate carrier or not. When they become victims, they contact local, state or federal law enforcement, and the answer is typically, 'Turn it into your insurance company.' Only the federal government has the authority, the resources, the technical abilities to mount an effective response.'Several bipartisan bills have been introduced this year to improve the response to cargo theft and to prosecute thieves. Earlier this month, the Combating Organized Retail Crime Act of 2025 was introduced in both the House and Senate. It would establish a coordinated multiagency response to organized cargo and retail theft. The bill also makes it easier to prosecute organized retail and supply chain crime groups using the internet to commit crimes. In January, Congresswoman Eleanor Holmes Norton, Washington's nonvoting delegate in the House, introduced legislation to give the FMCSA more power over fake companies attempting to register with the agency and to assess civil penalties. Such crime went from being conducted primarily by small groups of up to 10 people committing theft at truck stops and parking lots to organized, sophisticated, international crime Cornell, who heads the Inland Marine Crime and Theft Specialist Office at Travelers Insurance, told lawmakers at the roundtable that cargo theft fundamentally changed between 2020 and 2022. 'They don't have to physically be on-site risking themselves getting caught stealing the freight when they can actually impersonate a freight broker, hire a legitimate trucking company to pick up the freight for them, and have them move it. It allows them to be anywhere and steal freight from anywhere,' Cornell said. Such 'strategic cargo theft' has increased 1,475% since 2022, moving from 3% to 33% of all cargo theft, and continues to climb, he said. The current top 10 states for cargo theft, according to Cornell, are, in descending order: California Texas Illinois Arizona New Jersey Georgia Pennsylvania Tennessee Ohio Florida Cities in these states provide 'the perfect storm' for cargo theft, he said. 'They're either port cities or have large rail areas. They have strong economies, high population densities, arterial highways – you have the freight, the money and the people. That's where most cargo theft has been concentrated,' he said. However, with the stepped-up activity by organized, sophisticated crime rings, 'we're seeing cargo theft spread into nontraditional areas.' Providing a perspective from rail labor, Eddie Strom, president of a Brotherhood of Locomotive Engineers and Trainmen local, asked for feedback from train engineers at Union Pacific and BNSF reported back that over four working days, 104 container doors had been left open, 'with many that never get closed until something bad happens,' he said. 'This kind of stuff rarely happened in my past 20 years of my railroad career, but now, because of precision scheduled railroading, we are seeing a lot of things that were considered safety concerns before, that the railroads are turning a blind eye to.' Labor has been critical of railroads' use of precision scheduled railroading (PSR) to improve asset utilization and boost operating efficiency. 'PSR has directly caused this problem to get way worse as railroads have cut staff, including railroad police, and all trains are now double and triple in length,' Strom said. 'Both factors make it way more likely for the robbers to target these trains.' Ian Jeffries, president of the Association of American Railroads, disputed Strom's take on the issue. 'It won't surprise you that we might not necessarily see eye to eye on a couple of things,' Jeffries said. 'I don't think there's any data showing a correlation between train length and cargo theft. But what we are talking about is employees being put into dangerous situations, so when there's no deterrent from the prosecution side, it does nothing to keep [criminals] from coming back. 'When there's no teeth on the back end when it comes to enforcement and prosecution, and hitting people hard so they don't come back, then there's nothing keeping them from getting bolder and bolder and putting rail employees in a risky situation.' : Lawmakers look at expanding FMCSA's power to rein in cargo theft Los Angeles police recover over $3.9M in stolen cargo Data behind cargo and rail theft epidemic Click for more FreightWaves articles by John Gallagher. The post Trucking, rail implore Washington to help fight cargo theft appeared first on FreightWaves.
Yahoo
22-04-2025
- Business
- Yahoo
Combating freight fraud with certificates of insurance
Key strategies for combating fraud involve certificates of insurance for supply chain partners. In an industry that moves billions of dollars of goods annually, freight fraud has become increasingly concerning for supply chain professionals. Recent data from the Transportation Intermediaries Association (TIA) 'State of Fraud in the Industry 2024 Report' sheds light on the alarming trends and impacts of fraudulent activities in the freight sector. According to the TIA report, 'The average gross cost of fraud among respondents was $402,344.47, with some companies reporting losses well over $1 million, with the per-load cost of fraud averaging $40,760.17.' The impact extends beyond monetary losses, affecting operational efficiency, reputation and customer of the most prevalent forms of fraud identified is identity theft and impersonation. Criminals are impersonating legitimate companies, using stolen identities to commit fraud. This often leads to significant financial losses and damage to a company's reputation, proving there is a need for quality verification processes. At the moment, there is little recourse for fraud victims. If goods are stolen, identity theft occurs or any other problem results in a loss of the load due to a scam or fraud, there is nothing impactful that businesses can do. As of right now, the only options are file a police report and report the fraudulent motor carrier to the Federal Motor Carrier Safety Administration. Without concrete protocols in place to catch and prosecute the perpetrators, shippers, brokers and carriers are left with building their own solutions and trying to mitigate their exposure to fraud. There is hope in a bipartisan bill that has been brought to the Senate in hopes of cracking down on flash mob robberies and intricate retail theft Combating Organized Retail Crime Act of 2025 would establish a coordinated multiagency response and create tools to tackle evolving trends in organized retail theft. The two main sponsors of the bill are Senate Judiciary Committee Chairman Chuck Grassley, R-Iowa, and Sen. Catherine Cortez Masto, D-Nev. The proposed law would create a department under the Department of Homeland Security and develop means to investigate and prosecute thieves. Similar pieces of legislation were brought forward in 2022 and 2023 but didn't make headway. And in the meantime, supply chain professionals are still largely on their own to mitigate their exposure to fraud. A common tool/protocol for verification is a certificate of insurance. A COI is issued by the insurance provider, offering proof that a carrier has coverage. It includes the name and contact information of the insurance provider, policy numbers, term dates, underwriter details, coverage limits for cargo, auto liability, and general liability, as well as any extra insured parties. Because these documents are issued by the insurance company, a true third party for a shipment, it's another tool that can be used in verifying carriers and reducing fraud across the freight ecosystem. COIs serve as proof that a carrier has the necessary insurance coverage to operate legally and safely. By requiring and thoroughly checking these certificates, brokers and shippers can ensure they're working with legitimate, insured carriers. This simple yet effective measure can prevent many instances of fraud before they occur. The importance of COIs extends beyond compliance. They act as a trust-building mechanism in an industry where relationships and reliability are paramount. When all parties can verify each other's credentials and insurance status, it creates a more secure and efficient operating environment for everyone involved. However, the process of obtaining, verifying and managing COIs has traditionally been time-consuming and prone to digital companies have integrated into different transportation management systems that provide the verification immediately. The current process is a little more manual with more phone calls and can cut down on response time for brokers and carriers. Taking the value of certificates of insurance seriously is Truckstop. In 2024, Truckstop received over 500,000 carrier COIs through the Certificial integration. Currently, 80% of the COIs Truckstop receives come from this partnership. Rob Blanchette, co-founder of Certificial, said in a news release, 'Truckstop has been at the forefront of introducing digital insurance monitoring to the transportation industry, streamlining carrier connections and automating data collection. This innovation has led to cutting-edge insurance monitoring and a more trusted network. Together, we've successfully advanced digital insurance monitoring in the transportation sector.' Verifying insurance, is one of the most impactful processes to have in onboarding carriers as it can catch bad actors who fall through the cracks. The TIA report notes: 'As fraud tactics evolve, so too must the technology used to combat them. Companies should continue to invest in cutting-edge tools that enhance their ability to detect and prevent fraud. This includes advanced verification processes, real-time tracking systems, and artificial intelligence to identify and flag suspicious activity.' This level of up-to-date accuracy is crucial in an industry where conditions can change rapidly, and outdated information can lead to significant risk. As the freight industry continues to evolve and face new challenges, the role of technology in ensuring security and trust will only grow. The industry must remain proactive in its approach to combating fraud. This includes staying informed about emerging fraud trends, continuously updating security measures and fostering a culture of vigilance across all levels of the supply chain. The post Combating freight fraud with certificates of insurance appeared first on FreightWaves. Sign in to access your portfolio
Yahoo
15-04-2025
- Business
- Yahoo
Check Call: New legislation targets freight fraud
Freight fraud has continued to be a hot topic of discussion in the freight brokerage space. Last week at the Transportation Intermediaries Association annual conference, TIA President Chris Burroughs provided some guidance on the agency's plan to tackle freight fraud. Burroughs referenced 2020 Federal Motor Carrier Safety Administration data showing the agency had more than 80,000 complaints of freight fraud. He called the figure 'staggering and quite frankly unexpected.' He doubled down on the need for enforcement: 'We're also working directly with Congress and the federal agencies to push forward and getting regulations that are already on the books enforced.' Prosecuting and otherwise doing more than just reporting bad actors and stolen freight has long been a struggle for the entire freight industry. It seems there is some hope to be found in this arena after all. A bipartisan bill has been brought to the Senate in hopes of cracking down on flash mob robberies and intricate retail theft schemes. The Combating Organized Retail Crime Act of 2025 would establish a coordinated multiagency response and create tools to tackle evolving trends in organized retail theft. The two main sponsors of the bill are Senate Judiciary Committee Chairman Chuck Grassley, R-Iowa, and Sen. Catherine Cortez Masto, D-Nev. The proposed law would create a department under the Department of Homeland Security and develop means to investigate and prosecute thieves. Grassley said: 'Our bill improves the federal response to organized retail crime and establishes new tools to recover stolen goods and illicit proceeds, and deter future attacks on American retailers.' Cortez Masto added: 'Large criminal organizations are constantly evolving their tactics to steal goods from retailers and the supply chain in communities across the Silver State [Nevada]. The rise in organized retail crime has left businesses scrambling, and it is time for Congress to pass this bipartisan legislation to help law enforcement agencies keep our communities safe.' Grassley and Cortez Masto introduced similar legislation in 2022 and 2023. Here's hoping the third time is the charm. Legislation like this could not come at a better time. There is a strong fear that more fraud will occur as tariffs continue to change and surge between the U.S. and China. Grace Sharkey notes in a FreightWaves article: 'Importers facing steep duties are resorting to creative, and sometimes illegal, methods to avoid paying the required fees. Mislabeling goods, undervaluing shipments and falsely declaring the country of origin are just a few tactics being employed to bypass customs inspections.' Sharkey also brings up the historical precedent for tariff evasion. 'These types of fraudulent activities have already had significant financial implications. In one case from the early 2000s, a group of importers used fraudulent schemes to misrepresent the country of origin of textiles from China to evade tariffs. In that instance, the perpetrators were caught, but not before costing the U.S. Treasury over $100 million in lost duties.' A new artery for fraud and no way to stop the bleeding are the last things the supply chain needs. Last year estimated losses to fraud were $454.9 million. That's just the reported number; it's likely much larger once you get into loss of revenue, loss of business and financial fraud. The average value per theft also rose to $202,364 in 2024, up from $187,895 the previous year. Market Check. Ontario, California, typically serves as a strong barometer for the freight market in the U.S. It's a trendsetter. With most West Coast imports coming through the ports of LA and Long Beach and then heading inland, Ontario serves as that gateway. That being said, there is plenty of excess truck capacity and most outbound lanes have decreasing spot rates. Inbound container ships have seen a drop-off in volumes amid the threat of tariffs, which has pulled significant volume from the market. The prognosis for spot rates isn't much better as the Outbound Tender Rejection Index is 2.12% – half the national average. Ontario saw a 1.49% drop in rejection rates, which is great for shippers and brokers in the market as contract carrier compliance is incredibly high for this time of year. Who's with whom. Tariffs on goods coming into the U.S. from Mexico were subject to a 25% tariff before tariffs were paused for 90 days. It seems as though that number is subject to an increase. President Donald Trump has brought up a long-running water dispute between the U.S. and Mexico as a reason to possibly levy higher tariffs. The spat is over a 1944 water treaty, the 'Treaty Relating to the Utilization of Waters of the Colorado and Tijuana Rivers and of the Rio Grande.' The gist of the treaty is that the U.S. is obligated to deliver 1.5 million acre-feet of water annually to Mexico from the Colorado River and Mexico is obligated to deliver 1,750,000 acre-feet of water over a five-year cycle to the United States from the Rio Grande, with an average annual delivery of 350,000 acre-feet. Why does a treaty about water stand to disrupt cross-border freight? Great question. The current administration is saying Mexico has not fulfilled its water obligation. Mexican President Claudia Sheinbaum claims the drought has made it difficult for Mexico to comply fully with the treaty. However, the International Boundary and Water Commission, the organization that enforces the treaty, has been working to identify solutions that benefit both countries. The water shortage is negatively impacting produce grown in the Rio Grande Valley, which can also negatively impact the freight market, especially since produce season is around the corner. There has been no official word on whether additional tariffs would be levied or what possible actions could be taken against Mexico. The main impact seen from this will be decreased produce volumes from South Texas in a few weeks. Trump exempts smartphones, chips, computers from tariffs New rail-sea route boosts auto exports from western China to Middle East How RFID helps retailers streamline reverse supply chains ITS Logistics issues April U.S. port/rail ramp freight index Trump's tariffs rattle fashion's global supply chain The post Check Call: New legislation targets freight fraud appeared first on FreightWaves.
Yahoo
11-04-2025
- Business
- Yahoo
Senators Reintroduce Federal Bill to Stymie Organized Retail Crime
Federal legislators are answering the industry's calls on organized retail crime prevention and punishment. Senators Chuck Grassley (R-Iowa) and Catherine Cortez Masto (D-Nev.) reintroduced the Combating Organized Retail Crime Act on Thursday, their third attempt at introducing retail crime-related legislation at the federal level. More from Sourcing Journal Taking Recycling Rules to the Next (Federal) Level NJ Governor Signs Bill Tightening Retail Crime Penalties Steering Circularity Amid Not-So-Sustainable Policy Shifts The bipartisan bill is also co-sponsored by Marsha Blackburn (R-Tenn.), Amy Klobuchar (D-Minn.), James Risch (R-Idaho), Jacky Rosen (D-Nev.), Bill Cassidy (R-La.), Martin Heinrich (D-N.M.), Ted Budd (R-N.C.), Bill Hagerty (R-Tenn.), Lindsey Graham (R-S.C.), Steve Daines (R-Mont.), Mark Kelly (D-Ariz.), Katie Britt (R-Ala.) and Ted Cruz (R-Texas). It seeks to create an Organized Retail and Supply Chain Crime Coordination Center under the Department of Homeland Security (DHS). That center would bring together local law enforcement agencies and representatives throughout the retail industry. The bill also advocates for the development of new tools meant to streamline investigating and doling out punishment to organized retail crime perpetrators, as well as to find the stolen goods and cash associated with thefts and illegal resale transactions. Cortez Masto said she has seen firsthand the negative impact organized retail crime can have on a state, and said that, this time around, Congress needs to take action on the issue. 'The rise in organized retail crime has left businesses scrambling, and it is time for Congress to pass this bipartisan legislation to help law enforcement agencies keep our communities safe,' she said in a statement. Cortez Masto isn't the only one who wants to see action taken; the bill has garnered broad support from industry organizations like the National Retail Federation (NRF), the Retail Industry Leaders Association and the American Trucking Associations, among others. David French, the NRF's executive vice president of government relations, lauded Grassley and Cortez Masto for their decision to bring the legislation back to the Senate. 'ORC is occurring across the retail enterprise—supply chains, bricks-and-mortar stores, warehouses and online—with stolen product sold for a profit, oftentimes to fund other crimes,' French said in a statement. 'The Combating Organized Retail Crime Act of 2025 will align efforts within a new Organized Retail and Supply Chain Crime Coordination Center to ensure that resources and information-sharing will be available across local, state, federal and private-sector partners to bring cases and prosecutions against organized theft groups. This legislation is an important step to help prevent ORC from infiltrating local communities across the country.' Third-party logistics giant UPS has also put its support behind the bill; Michael Kiely, the company's president of global public affairs, said the bill could help companies keep up with the myriad ways thieves are upgrading their game. 'UPS supports the Combating Organized Retail Crime Act as it provides the necessary resources and coordination to protect the movement of American goods throughout our country while safeguarding the integrity of our national supply chain from rail to road, to retail,' Kiely said in a statement. According to the federal bill, more than 30 state laws have been passed since 2022 in an effort to prevent retail crime. New Jersey was one of the latest to sign a bill upping the ante on punishments for perpetrators, and two additional states seem to be looking to join that group. In Nevada, Governor Joe Lombardo has put his support behind a sweeping Senate bill called the Safe Streets and Neighborhoods Act, which includes provisions related to retail crime. The bill would lower the threshold for a felony charge to $750, down from $1,200 and would impose stricter penalties for repeat offenses. And in Maryland, both chambers of the state legislature passed the Organized Retail Act of 2025, introduced by Delegate Karen Toles with the support of delegates Robin Grammer, Wayne Hartman and Chao Wu. Now, that bill has been sent to Maryland Governor Wes Moore's desk for final signature. If the governor signs the bill, it will take effect in October, and will allow prosecutors to merge multiple retail crime convictions, regardless of the county the crime occurred Maryland Retailers Alliance lauded the bill making it through the legislature. 'Retailers across Maryland have been sounding the alarm on organized retail crime for years,' Cailey Locklair, president of the organization, said in a statement. 'This law is a game-changer. It finally gives law enforcement the ability to treat organized retail theft as the serious crime it is, rather than a series of unrelated incidents.'
