According to data from CargoNet at Verisk, there were 776 reported incidents of freight theft in Q3 2024, which is a 14% year-over-year increase. However, that’s not the only thing that keeps the Vice President of Operations of CargoNet, Keith Lewis, up at night. Lewis is more worried that the actual number of incidents is likely much higher than what is being reported.
“We've got a lot of delayed reporting,” said Lewis. “And one of the things that really scares me is that most thefts go unreported. I’ve spoken to one customer that told me that, if they reported all of their thefts, there would be more incidents than CargoNet reports for a whole year.”
CargoNet aggregates information and intelligence on stolen goods into a database so it can be shared with theft victims, insurance agencies, and law enforcement. The company also provides shippers with theft recovery assistance. Although recovery efforts can be successful, by the time a shipper is talking with Lewis, the situation is already less than ideal, and the theft has already taken place.
Prevention is always the best strategy for combatting freight theft. There are many preventative measures shippers and transportation providers can take to ensure cargo remains safe and secure. However, before considering strategies, it’s important for shippers to understand the types of fraud they’re up against.
The Top 4 Methods of Freight Fraud & How to Beat Them
There are multiple types of fraud that brokers, carriers, and shippers need to watch out for. Some of these methods are increasing more than others:
1. FICTITIOUS PICKUPS – The equivalent of identity theft for carriers. Cybercriminals pose as legitimate carriers to gain access to and steal shipments. This method is particularly effective in the freight industry because it takes advantage of its fast-paced environment.
“We're moving goods at lightning speed through the supply chain,” said Lewis. “The faster we move goods, the less vetting, the easier it is to do the fictitious pickups or double brokering or whatever.”
How to beat it: Smarter and better vetting processes. Fictitious pickup attacks are most successful against brokers that don’t have the proper technology, process, and continuous training to confirm a carrier’s identity before booking a load.
2. TRAILER/CONTAINER THEFT – The theft of a trailer, a container, or part of the contents. Thieves break into a trailer and steal freight or steal the entire trailer and sell whatever they find inside.
How to beat it: GPS tracking and effective carrier communication. Trailers that don’t have any sort of GPS tracking make easy targets for thieves. Having clear communication with the carrier goes a long way to ensuring security processes are followed during any planned stops.
3. DOUBLE BROKERING – When a shady carrier obtains a load from a broker and then brokers it again to another carrier. While double brokering isn’t illegal, it can result in stolen loads and financial losses for carriers, brokers, and shippers.
How to beat it: Again, proper vetting and forming strong relationships with reliable carriers. Fraud starts during the carrier onboarding process, which is why intensive vetting is so important when working with new carriers. Working with a smaller pool of trusted and proven carriers is the better way to go.
4. LOAD PARTIALING – When a carrier adds someone else’s freight to a single-customer truckload (FTL) without breaking the seal. Most customers prefer their loads run FTL, meaning theirs is the only freight on the truck. Shady carriers will sometimes figure out a way to pop the doors off a trailer to add another customer’s freight to the same load to maximize profit.
How to beat it: This all comes down to forming strong, long-term relationships with carriers. Continually working with reliable carriers increases trust and reduces the risk of shady practices for the sake of short-term gain.
Better Prevention through Technology, Training, Assets, and Processes
Freight is a fast-moving industry with complex parts. Even on a perfect day, it’s a challenging environment to work in. Throw in freight fraud and the constantly evolving sophistication of attacks, and it becomes even harder. It’s not a forgiving industry in terms of mistakes, which is why training, technologies, and processes are so important.
“Anyone who’s worked in this industry knows there isn’t time to throw open a protocol manual and run down a list of checks while booking a load. In addition to technology and infrastructure, all that knowledge needs to be ingrained, " said Adam Angle, Senior Vice President of Capacity and Assets. "Vetting should feel like second nature, something foundational brokers can fall back on when things get hectic.”
That all sounds very aspirational and good, but making it happen takes investment at the front end. For us at ITS Logistics, every team member must go through an extensive six-week training program, much of which is spent with top-performing mentors, before being left to independently work and learn as part of multiple teams working with multiple modes of transportation and industries for another two months.
If you’re wondering how much of that training is about freight fraud, it’s a significant piece. We use a multi-step process with built-in redundancies that incorporates systems like Highway, Carrier 411, CargoNet, Truckstop, GenLogs, and several others.
ITS combats fraud and theft through real-time tracking and the heightened vetting of dormant carriers.
“It’s not enough to trust; every detail needs to be verified. Only pre-approved contacts get access, adding a layer of security that cuts down on risk. And if a carrier sits idle for a short period of time, re-vetting kicks in before they’re cleared to move another load," said Angle. "This isn’t just policy—it’s a fundamental step that ensures reliability and keeps the network secure, no matter how fast things move.”
When we involve ITS assets into the solution, we’re able to further mitigate risk. For example, when an ITS trailer is on a shipment, live GPS tracking allows us to constantly update and monitor its location. The tracking is connected to the load information in our proprietary TMS and driver tracking platform, and any deviation triggers a notification to our team. Additionally, IOT sensors in our trailers alert us whether a trailer is loaded or unloaded.
Another example is our yard management process, where we can utilize completely fenced yards with single points of entry, closed-circuit TVs across all borders, check-in/check-out procedures with staffed guard gates, and OCR technology to scan the side of the truck for digital fingerprinting. All this data is managed and stored in a modern yard management system (YMS) that provides real-time updates.
Aside from training, continuing education, and careful asset management—process adaptation is the last and most important part of prevention. It’s not enough to have a set-it-and-forget-it mindset to freight fraud. Attacks and cyber criminals are always adapting to new systems, and there will always be another and more sophisticated fraud attack. It’s up to the industry to continue to innovate and ensure their training, technology investments, and processes are keeping up, which is something ITS Logistics takes very seriously.
The Freight Recovery Process
Even with the best-laid plans, the worst can still happen. And if shippers do happen to find themselves as a victim of freight fraud or theft, it’s important to have a process in place ahead of time to improve the chances of recovery.
Here are some tips on what that process might look like:
- Put teams in place to take specific roles in the reporting and recovery process and build out SOPs (Standard Operating Procedures).
- Report incidents to law enforcement agencies and supporting organizations, like CargoNet, as soon as possible. Make sure to include details like the driver’s name and any other available identifiers; truck and trailer information, including VIN numbers if available; and any other available information.
- Have a recovery plan; even if law enforcement recovers the load, you’ll need a driver and tractor ready to rapidly recover it.
Don’t be a Victim – Protect Your Freight with ITS Logistics
Don't let your valuable freight fall victim to fraud and theft. At ITS Logistics, we're committed to safeguarding your shipments through rigorous vetting processes, best-in-class technologies, real-time tracking, and advanced fraud prevention strategies.
Our extensive training programs equip our team with the knowledge and tools needed to keep your cargo safe from threats, both physical and digital. By partnering with us, you’ll benefit from our proactive approach to freight security, dedicated to staying a step ahead of evolving fraud tactics. Protect your freight and ensure peace of mind—reach out to ITS Logistics today and let us help you secure your supply chain.
