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Lifting LaTour Part 3: Warehouse Theft & Risk Assessment

Posted by Electric Guard Dog on 12/1/15 2:01 PM
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In Part I of this series, we talked with former Georgia Bureau of Investigation Agent and Cargo Net VP of Operations Keith Lewis about security product choices for warehouse security, and in Part II, we discussed employee and visitor screening and staging access. We’ve utilized the $2.3M warehouse theft from Berry Bros. & Rudd as an example of how even a seemingly well-protected warehouse can become a victim of a major theft.

Lifting LaTour Part 3 Electric Guard Dog and CargoNet

In Part III, Keith Lewis offers some parting thoughts on the raid, as well as recommendations for security directors who wish to perform a new risk assessment on their own properties.

Final Analysis of the Raid:

The two major fall downs the wine merchants made, in Keith’s eyes, were:

  • Not investing in deterrence-based security, specifically a guard and an electric security fence
  • Not amply vetting employees and visitors to the warehouse.

Keith is adamant. “This was 100% an inside job, as we’ve discussed. And the thieves were professionals. They didn’t steal more than they already had a buyer for, likely. Sometimes thieves steal more than they have pre-sold and that is there they get caught. If they have 10,000 cases sold and steal 12,000, they are stuck with 2,000, and they get caught selling those on the street. These guys had a small truck to sit the product in, and they were smart.”

The Berry Bros. & Rudd warehouse theft is still an open case, and the insurance claim is likely to be much higher than the actual theft. But whatever the amount of the claim, it will not include:

  • Production interruptions/shipments missed
  • Deductibles & escalating insurance costs
  • Loss of reputation with customers
  • Private detectives, security experts to advise on new measures
  • Company time involved in prosecuting the thieves if they are ever caught.

The investments the wine merchants made in security did not adequately assess the risk. Why? Keith’s answer is terse. “Money. At the end of the day, the insurance company is going to pay the claim. It’s only when their customer comes into the warehouse and says, ‘I am moving my product elsewhere, I don’t care that you are paying my claim,’ then the business feels the pain. ”

But if you wait until you’ve suffered multiple thefts and clients leave, are you going to have the resources necessary to make big capital expenditures overhauling security?

Keith’s answer is adamant. “You’re not going to have any money. You will need significant upgrades to revitalize your business at a point when you won’t be able to afford to do that. That’s why it’s best to learn from other people’s mistakes.”

Assessing Risk at Your Warehouse:

If you’ve read this 3 part series, and decided to do a new risk assessment on a property you currently own, Keith advises:

  1. Be proactive and be honest with yourself. Assess your risk according to total losses. “Recalls, damage to your reputation, these are the costs that will kill your business,” Keith states.
  2. Examine whether you have deterrence-based physical security measures in place. Can your security choices defend your property without assistance from police? If you have an electric security fence, is it switched on? Are your cameras working? Monitored in real-time? Is your facility located in an area that is sparsely populated at night? Is there a guard present?
  3. Disciplined, routine testing of all security measures. “It’s amazing how many times businesses get robbed and acknowledge they knew the cameras weren’t working, or they didn’t know, because they didn’t run routine tests. Usually someone there knows, and by the time I’m called in, it’s because the person who knew passed that information along to a thief.”
  4. Maintain a strict methodology on employee, vendor, and visitor screenings and staging. Update them on a schedule.
  5. Layer your security: have deterrence based perimeter security; make routine assessments of your yard, for items a thief could use as a tool. Have additional measures around the immediLoJack SCI Convert GPS Deviceate warehouse perimeter. Once inside, stage your most valuable property in the middle of the warehouse, with limited employee access and separate security measures. For high-value products, also consider embedding some of LoJack SCI’s covert GPS devices, just to be safe. They are cost-effective and disposable, and if your product is ever stolen, you have a way to track it.
  6. Protect, review and update all security blueprints, computer access, passwords, etc.
  7. Join your local and regional security councils, and get assistance from organizations like CargoNet. Attend meetings, share information on new theft techniques. Keith elaborates, “Dig your well before you’re thirsty. When you call 911 after a theft, you’re in trouble unless you have a cop on speed dial. All you’re going to get at 2 a.m. is a report.”
  8. Never be complacent.

New Warehouses

If you are in the market for a new warehouse, and plan on storing high-value or high-risk products, Keith recommends asking whether the building was designed for high-value security, and what those measures are, as there are no standard definitions. It’s better to spend a bit more for a warehouse that has considered security: retrofits are expensive, and your security plans could potentially be undermined by budget overruns. Ask if there are ordinances regarding perimeter security fences. Review crime reports for the area.

And if you are robbed? Keith sighs. He’s spent his entire career trying to prevent that. “Just reverse engineer it. Work your way out of the building: how did they get in and work your way back to the driveway. Then my recommendations would include a guard inside. If you can’t afford one, intelligent camera systems with real-time monitoring. Outside, an electric security fence.”

Parting Advice

Keith’s conclusion: “Here at CargoNet, we look at it like we’re at war with the criminals. They have their tactics, we have ours, but they have the distinct advantage of knowing when and where they are going to strike. We need to plan and practice all security measures habitually, at every facility, to ensure execution to be better. That requires discipline.

“And you can’t rely on detection-based security measures like alarms. If you are relying on an alarm, I can tell you from my days on the force that is one of the lowest priority calls. We have to answer violent crime calls first. When I got an alarm call from a business, I would issue a ‘First available unit’ response. That meant nobody change what they’re doing, even if they’re on a traffic stop or a break. Could be 10 minutes until there’s an available unit, but on a rainy night it could be 6 or 7 hours.”

Keith concludes, “Alternatively assessing and pro-actively securing your business with deterrence-based security measures is an idea worth toasting.”

Cheers, Keith.

About Keith Lewis

Keith Lewis is Vice President of Operations at CargoNet, responsible for managing operational efforts that include the supervision of operations center staff, investigative support and system training for CargoNet members.

Keith began his career in 1980 as an operations manager in the transportation division of one of the country’s largest 3PLs, and worked his way up through the ranks to eventually hold the role of general manager; overseeing the company’s trucking division as well as a 1.1 million square-foot distribution center. Keith also held high profile roles at two other major 3PLs.

In 2000, Keith left the logistics industry to pursue a career in law enforcement, where he worked as a Task Force Agent for the Georgia Bureau of Investigation.   Keith has a BS in Criminal Justice, and continues to be an active agent with the Georgia Bureau of Investigation; assisting them with undercover and sting operations.

Topics: warehouse theft, Lifting LaTour Series