Security in the transport/logistics industry

by / Monday, 09 February 2015 / Published in Blog
This article is what Ray Mancini believes, are the main issues that poses the greatest risks in the transport industry. The article has not been written to provide all encompassing solutions to the problems but rather providing simple, cost effective and achievable solutions that focus on the five key topics. If utilised wisely, these solutions will provide companies with an opportunity to not only protect their brand name but to generate increased revenues on their bottom line of their profit and loss statements.

1. Organised Crime

Organised crime is increasingly found in industries where there is traditionally little awareness of, or exposure, to their activities, where gaps in regulations can be exploited and/or where the penalties for crime are not sufficient to deter criminal behaviour. The Transport Industry presents opportunities for this exploitation by organised crime. (Australian Crime Commission, 2007.)

From Ray Mancini’s own experiences through the role as the security contractor for transport companies, organised crime members were able to infiltrate other companies by being an owner operator contractor or as a contract truck driver.

One transport company employed a contract truck company to transport their freight locally; however, this company’s owner had strong links to an organised crime syndicate and in fact employed members from his group.

More importantly the fact that there is no dedicated national law enforcement unit targeting/combating organised theft of freight within Australia, especially involving organised crime gangs, has permitted these crime syndicates to flourish.

Previously a joint venture by Australian Federal Police (AFP), Customs and various state law enforcement agencies created the RAFT project (Reduce Aviation Freight Theft), which introduced a multiagency approach to investigating the theft of aviation theft. However, after a period of time in many states this project was abandoned and the intelligence was handled by AFP in Canberra. (To the author’s knowledge, Queensland is the only state that still maintains the RAFT Project that involves security employees from transport companies).

I acknowledge that many states law enforcement services do have a ‘gang crime squad’ to investigate organised crime gangs’ activities, however many crimes perpetrated within the transport/logistic industries is more than often not reported or over looked by the police due to the crimes themselves being a lower priority or there were no avenues of inquiry.

The RAFT Project was conceptually a positive move by the law enforcement agencies, however it was hamstrung as it targeted aviation freight not necessarily road freight.

The Transported Asset Protection Association (TAPA) is a unique forum that unites global manufacturers, logistics providers, freight carriers, law enforcement agencies and other stakeholders with the common aim of reducing losses from international supply chains. (TAPA, n.d.)

According to the European Union, the theft of high value, high risk products moving in supply chains in Europe costs business in excess of 8.2 billion Euro dollars a year. The threat from organized criminals is increasing and becoming more violent. (TAPA, n.d.)

Recommendation:

  • The RAFT project including the Joint Aviation Investigation Team (JAIT) should be re-created and implemented on both a national and state level, involving both road and aviation transport companies and the respective security companies (involved in the protection services for the various transport companies).
  • Continual security awareness training for employees and security personnel to reduce apathy displayed by employees and managers in the respective transport companies.
  • The provision of TAPA training to staff and the adoption of TAPA’s minimum security standards. Regular auditing of security by a qualified TAPA auditor or security personnel trained in TAPA certification standards.

2. Terrorism

Transport companies have, today, transformed into transnational companies, providing international freight services across the globe. As such, dramatic increases have occurred in the demand of express service delivery of international freight utilising aviation services, including both freighter and passenger aircraft.

However, the increase demand of international freight services increases the risks of terrorist activities within this area.

For example, in 2010, two separate items of freight (printer cartridges) were detected to contain Improvised Explosive Devices (IEDs). These items had already been loaded onto two separate freighter aircraft in the United Kingdom for flights into the United States. Imagine the carnage if these two IEDs exploded over heavily populated areas. This could have replicated the disaster over Lockerbie Scotland in 1988.

Note: Pan Am flight 103 (Boeing 747) exploded over Lockerbie, Scotland, after a bomb hidden in luggage exploded causing debris to crash into the Scottish village of Lockerbie below. 270 people were killed, including 11 people who were on the ground.

Whilst the transport industry already has measures in place such as screening and security checks to reduce the risks of IEDs and other explosives or chemicals being loaded onto aircraft, the devious minds of criminals/terrorists continue to improvise methods to circumvent detection strategies.

These incidences have caused a growing awareness in the industry for improved security. Many governments have made it mandatory for improved freight screening and security procedures to prevent breaches.

According to the Australian Government (n.d.), transport systems continue to be attractive targets for terrorists seeking to inflict mass casualties, economic damage, instill fear and create spectacular media imagery. Transport security encompasses aviation, air cargo supply chains, maritime and mass passenger transport systems such as road and rail.

The Office of Transport Security (OTS) is responsible for regulating and monitoring transport and air cargo security on behalf of the Australian Government. OTS is responsible for administering an intelligence-led, risk-based preventative security regime. OTS works with the aviation and maritime industry to achieve sustainable and proportional preventative security measures that are commensurate with the nature and level of the terrorist threat.

Supply chain security for air cargo is regulated in Australia under the Aviation Transport Security Act 2004 and Aviation Transport Security Regulations 2005. It is administered under the Regulated Air Cargo Agent (RACA) and Accredited Air Cargo Agent (AACA) schemes.

The RACA scheme regulates air cargo security for a range of industry participants through the preparation, implementation and compliance of a Transport Security Program compiled by the respective transport companies and the regulated shipper scheme that includes:

  • Cargo terminal operators at airports
  • Express post services
  • Freight forwarders (including express freight companies)
  • Regular international postal services
  • All freight for international destinations via the aviation industry is processed according to the ‘Unknown Shipper Process.’

However, due to time constraints’ lack of knowledge or lack of communication this process is often neglected increasing the odds and risks that an unlawful item or substance could be loaded onto an aircraft.

It is interesting to note that, in Australia, surface (road) transport security arrangements are under state and territory jurisdiction with OTS working to coordinate the dissemination on best practice information on security measures. Implementation of preventative security measures is the responsibility of owners and operators of the individual transport companies.

Recommendations:

  • Training/information is required for transport operators and employees in relation to RACA and security awareness for the security of their freight.
  • Updated and continual training required for security and transport employees (company or contract) in the areas of transport/logistics and aviation security requirements, including RACA and other regulatory or convention requirements, including the ‘Unknown Shipper Process’.
  • Provision of suitably trained and qualified security guards to provide professional and quality guarding services within the transport/logistics industry.

3. Theft of freight

Criminals utilise employees to gain intelligence or provide information as to which transport company is transporting the various brands or products of high value electronic freight (for example Apple, Panasonic and JVC electronic items).

Criminals will target transport company employees to provide information as to the specific company’s weaknesses and areas of opportunity in order to target the company in their plans to commit offences.

These plans could culminate in offences being committed across various states (causing various jurisdictional issues with law enforcement agencies) and whilst the freight is in transit (difficult to track and delays the discovery of the crime). For example high value freight is often targeted on the Sydney to Perth tour as it is a three day transit tour, thus delaying the discovery of the crime and reducing the possibility of apprehending the perpetrators.

Many employees in the transport industry are low income earners, which increases the risks of these employees to provide information, steal freight or provide accessibility for criminals to access freight, in order for the employee to supplement their low wages through bribes or ‘pay offs’.

On the sociological side, we need focus only upon the broad reality of contemporary economic life. It is a fact of life that the majority of the work force will struggle to survive with the wages that they earn. In more cases today many people live in excess of their earnings, which is powered by the yearnings to have more. This desire to live at a level excessive to their earnings causes frustrations with their working life and conditions which can be reflected onto their attitude towards their employer. (Mann & Al-Khadha, n.d.)

Mann and Al-Khadha (n.d.), suggests that many employees do not enjoy their jobs, or do not enjoy much of what they do at work. They work in order to get money to live. While they work they follow orders from others, with which they do not necessarily agree. Often they have no knowledge of the decisions underlying such orders, who made them or why.

The employee’s desire to have a better life and possess more expensive items is created as by what Mann and Al-Khadha (n.d.) suggest as marketing efforts to stimulate ever more wants for ever more consumer goods. New products can be presented as compensations for the general powerlessness, frustration, insecurity, domination and struggle of the majority of the population. Here is another major source of duress for many people – the duress of thwarted desires, along with envy and resentment of those who apparently have everything while doing nothing to deserve it.

This stress is then reflected by the employee’s attitude towards their employer or business. One of these attitudes is called rationalised actions.

Rationalised action can be described with the example that an employee looking to steal an item and rationalises their actions with the fact that the company is making millions but not looking after their workers.

Many workers are transient temporary labour hire employees who have no allegiances to the respective hiring transport company and are hired as no one else has a desire to complete a four hour split shift ranging from 0200 to 1000 hours and 1500 to 2100 hours.

As such the risks of theft and damage due to poor handling skills and lack of training is increase ten fold, especially since the turn over of staff is significant and the continual training of these personnel is a large cost burden to the parent company.

Whilst many large transport/express companies are implementing ‘up to date’ technology to allow customers to track their consignment over the internet and also to provide internal ‘visibility’ of a specific consignment or item, many companies have not.

However, the transport companies that have implemented the track and trace scanning recognize that many employees do not scan the freight for a variety of reasons, including laziness, lack of time or so that the item itself can be stolen.

Transport companies that conform to the TAPA convention security standards, still suffer the indignity of losses through theft or compliance failures as employees have failed to comply with policies or procedures.

Many incidents lack the appropriate security investigation to uncover the root cause so that procedures or strategies can be implemented to reduce the incident or risk of the specific failure occurring in the future.

Recommendations:

  • Training is provided on a continual basis for all employees and contractors to maintain their knowledge of scanners, scanning disciplines and scanning compliance requirements.
  • Adequate and frequent training of freight handlers to handle the freight in a correct manner to reduce the risks of damage or injury to the freight handler.
  • Security personnel are involved in the handling, securing, sorting, scanning and loading of high risk freight. Therefore the security personnel must also be adequately trained in the handling and sorting requirements of high risk freight or freight classed under an ‘Enhanced Security Program’ requirement.
  • Provision of the appropriate training to security personnel / transport staff to enable the thorough conduct of factual investigations and subsequent root cause analysis.
  • Security personnel / transport employees must have the knowledge to conduct security audits and risk analyses so as to reduce the risks of theft or shrinkage.

4. Transport Companies

Transport companies operate under increasing financial challenges caused by the world’s markets, including fuel. Various natural disasters, such as the Iceland Volcano Eruptions can bring air traffic to a stand still, costing companies millions of dollars.

Transport companies profit margins are not as large compared to other industries such as the mining/resource sector. Therefore freight is moved as rapidly as possible and as per the contractual agreement with the customer, to ensure the highest level of profit and more importantly return business of a satisfied customer.

However, it is this rapid handling of freight that causes process failures to occur. Efficiency versus expedience is always an issue with the movement of freight and a headache to security personnel tasked to investigate missing freight, as expedience will always be put first.

Further, the lack of customer service units and/or appropriate security personnel coupled with the lack of appropriate training can delay the early detection of lost or stolen freight, which, in turns increases in attempting to locate the freight.

Recommendations:

  • The appropriate training is provided to employees to equip them with the knowledge and tools so they are capable of conducting inquiries to locate freight or to report freight missing as soon as possible.
  • The provision of easily accessible training tools and workshops, which are cost effective, and do not waste employee’s and employer’s time.

5. Security Companies

With the various security issues experienced across the world and with new challenges being faced with every new day, numerous security firms have been formed to meet the growing demand for private security as law enforcement agencies are battling to cope with increases in demands for their services.

Many security companies offer security guarding services within Australia and are competing against each other to obtain business. Many companies attempt to under quote their competitors to dangle the ‘cheaper cost’ carrot in front of transport company managers/directors in their attempts to win the contract. As such these security companies have to reduce their costs in the only areas where possible, including staff wages/conditions and training. This results in the supply of under trained and unwilling security guards.

The supply of a security guard, who is tasked to watch a CCTV system and sit at a guard hut to provide access control to a depot, is no longer acceptable or viable. Security personnel now and in the future need to be fully trained on a variety of subjects (i.e. investigate losses, understand and use complex electronic surveillance equipment, knowledge of the transport/logistics industry), be able to multi task and have that willingness to conduct other transport related duties such as pallet counts, refuelling vehicles, audits etcetera to assist in providing the cost effectiveness to the transport industry.

In the author’s experience a cheaper service doesn’t always equate to a cost effective solution. Unfortunately and it is still happening with security companies attempting to run with small margins and thus supply a blanket of security guards at a cheaper rate. Many of these security employees are not paid according to the specific awards and are not trained to an appropriate level.

However, I also note that there are also competent security companies in the market who are passionate about the security industry and maintain their longevity within the security industry through the provision of a quality security service, which is reflected by their employees.

Recommendations:

  • That security companies who provide the appropriate level of security services associated or aligned with a registered training organisation and who have transport industry trained / experienced guards should be sourced to provide the requisite guarding requirements for the various transport companies.
  • In any hire or tender process, transport companies are encouraged to request references from other transport companies and investigate the incumbent security company to ascertain other evidence of what specialist transport/logistics security services they have provided in the past.

Conclusion

The transport/logistics industry is rapidly evolving and transforming due to many factors that are being faced today and in the future that include costs, increasing demand for movement of high value freight and global security risks.

However, with these changes the industry must embrace the appropriate high level of security to ensure that their assets, employees and customer’s freight are protected to minimise risks from theft and losses.

The old cliché that security is a cost that cannot be retrieved is a thing of the past. The more savvy transport companies are now utilising security services and protection of freight as a selling tool to customers in order to win their business or to increase their bottom line of their profit and loss statement.

About the Author

Mr Ray Mancini is an internationally known trainer, and professional security consultant. He is an expert in the fields of Close Personal Protection, Close Quart Combat, Firearms & Tactics Instructor, Risk Assessment, Risk Management and Crime Loss Prevention. He specializes in the anticipation, recognition and prevention of crime on commercial and industrial properties. Ray consults with corporations, insurance agencies and police on how to reduce risk. Ray has been and continues to be involved in High Risk Protective Security Detail, as a private security contractor in Papua New Guinea, Africa and all over the Middle East. In the mid 90′s Ray was responsible for the personal security of Mariah Carey, Ice T, Alaa Zalzali and recently Zoe Badwi.

Currently Ray is the Operations Director of SIG National Pty Ltd, which has been providing security services to the transport industry for the past 7 years with clients such as Star Track, Toll Group, Australian Air Express, Centurion Transport, TNT and the US Navy. Also Ray has in excess of 18 years’ experience as a law enforcement trainer and a chief instructor in firearms and tactics. Ray has many qualifications including Diploma in Investigations and Management as well as Training and Education. Ray is currently studying a Master of Arts degree in the fields of terrorism, safety and security. Ray is also the Training Director of SIG Academy and is responsible for establishing one of the largest weapons manufactures academy in Australia (SIG SAUER).

References:

Australian Government, (n.d.). air cargo security. Retrieved from

www.infrastructure.gov.au

Australian Government, (n.d.). transport security threats. Retrieved from

www.infrastructure.gov.au

Australian Crime Commission, (2007). organised crime in australia, retrieved from

www.crimecommission.gov.au

Mann, S. & Al-Khadha, M. (n.d.). Freedom of the will and criminal culpability, retrieved from

www.austlii.edu.au

TAPA, (n.d.). supply chain security. Retrieved from

www.tapaamea.com

RAY MANCINI

CEO – SIG GROUP

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