Opportunity and value come together on construction job sites all across America and thieves are making the most of it. Stealing heavy equipment is a thriving crime.
The total value of stolen equipment each year in the United States is in the neighborhood of $300 million to $1 billion. The range is so large because of incomplete theft data, but any number you pick within that range represents a big problem.
The thefts are happening so often because construction equipment and machinery are relatively easy to steal and easy to get rid of in a shadowy worldwide market, including a black market. Furthermore, each piece of equipment generally carries a high profit margin for the successful thief.
If that isn’t incentive enough, thieves get help from the unlikeliest of quarters: the contractors they victimize. Because many heavy equipment owners and renters are not taking the steps they could to safeguard their equipment, they are benign accomplices in the thefts.
That sounds harsh, but law enforcement and insurance industry officials tend to agree on this point: equipment owners or renters are falling short of doing all they can to prevent theft.
“Productivity is king,” said David Shillingford, president of National Equipment Register (NER). “Contractors say, ’I want equipment that I can use, that my employee can jump on and start up.’”
Because contractors want it that way, manufacturers provide it and thieves take advantage of it. An example is the nearly universal keys for machinery that are readily available. More exclusive keying of individual pieces of equipment obviously would slow some thieves.
“It is unfair to criticize manufacturers,” Shillingford added. “They respond to the market.”
He said as long as safety and productivity are the top concerns of equipment buyers and operators, “security will remain lower down the list of features.”
This is not to say that reasonable precautions aren’t taken. But in the face of rapacious thievery, reasonable precautions evidently aren’t enough.
National Equipment Register was created five years ago in response to the epidemic of theft. Its role is to build a database of registered and stolen equipment. To that end, it has accumulated approximately 12 million ownership records and compiled a list of more than 70,000 reports of stolen construction and farm equipment. NER cross-references the two stacks of data to track down and recover stolen equipment. It works on this with the Insurance Service Office Inc. and such industrial partners as the Associated General Contractors of Americas (AGC), the American Road and Transportation Builders Association (ARTBA), the National Utility Contractors Association (NUCA) and the American Rental Association (ARA).
“We have recovered over $4 million in equipment,” Shillingford said. “Equipment that wouldn’t have been recovered otherwise.”
Recovery indeed is not the usual outcome when heavy equipment turns up missing. Slightly less than 10 percent of stolen machinery is returned to its owner.
Some 2,800 law enforcement agencies are using the NER data to help them solve crimes. Among these agencies is the police department of Canton Township, a suburb of Detroit, MI. The Canton Department of Public Safety sponsored a seminar earlier this month in partnership with adjacent Northville and Plymouth townships and the local CrimeStoppers organization.
The goal was to discuss and formulate “crime prevention strategies for worksites,” said Sgt. Scott Hilden. Hilden is in charge of Canton’s Crime Prevention Unit. Canton’s director of public safety, John Santomauro, asked for the program.
“We Nail Thieves” was the theme, which was effectively communicated in a poster distributed for public display. It warns that area authorities are serious about capturing and prosecuting anyone who steals from a job site. Construction thefts in Canton have declined slightly in recent years, but remain a major criminal activity.
Last year, the jurisdiction experienced 75 thefts totaling $278,000. Over the last five years, the loss figure is $1.5 million.
“That’s just the ones that are reported,” Hilden noted. Smaller equipment and materials losses frequently aren’t reported in Canton or anywhere else. It is considered too much trouble, an attitude perhaps strengthened by the low recovery rate.
Hilden and his fellow officers suggested ways equipment can be safeguarded. He invited to the PowerPoint seminar the contracting companies’ supervisory personnel. He wanted supervisors there because if the department’s suggestions are going to be implemented, someone with supervisory authority must do it.
Essentially, Hilden asked the contractors to assume more responsibility for their equipment. He said too many home builders, for instance, are almost casual about security.
“The thinking of many of the builders seems to be that they are going to lose a lot of equipment, so they’ll just make the houses more expensive to buy,” he said.
He hopes the seminar will discourage that attitude.
“A lot of the reason for the thefts is that they are a crime of opportunity,” he said. “Work sites are not patrolled, high value items are not locked up or put in safe places. There is no sense of security at the sites” after hours, which virtually invites thieves to try to steal something.
A variety of preventive measures were suggested. They include:
• Securing an equipment yard with chainlink fence, perhaps with barbed wire at the top;
• Hiring security guards to patrol a site;
• Lighting up the perimeter of a site overnight;
• Periodically checking job sites for unusual activity, especially on weekends;
• Using different types of locks and bars that can impede a thief from cranking up and driving away a piece of machinery.
If contractors follow these and other recommendations, Hilden is convinced thieves will have a harder time of it in Canton.
“If contractors will take this information and use it,” he said, “they are going to reduce the thefts on their sites. There is no question about that. I think the number of thefts will go down significantly.”
Far south from Canton, in Miami, FL, the Miami-Dade County Police Department is coming at the problem from two directions.
Unlike Michigan, Florida is a hotbed of equipment theft. It ranked fourth in 2004 in the frequency of such thefts, as ranked by NER. It was No. 3 the year before.
More ominous is that while Florida also was ranked third in 2003 in recovery of stolen items, in 2004 it dropped to No. 10 in recoveries. In other words, more stolen equipment in Florida is staying stolen.
Miami-Dade authorities established a task force in 1996 to deal with what is described as “cargo theft,” the expensive commodities that are stolen from warehouses and trailers. In 2003, such thefts in the county were in the $40 million range.
“Most of it was construction equipment,” Lt. Eddie Tetow, one of 25 people on the task force, said.
There is no mystery why south Florida has a generally high theft rate: The area has a constantly high volume of construction.
“The overriding factor [in one state having more thefts than another] is the amount of ’targets’ available to thieves,” the NER’s 2004 report concludes. “Theft rates closely follow equipment volume; where there is more equipment, there usually is more theft.”
But there is another factor in the case of Miami-Dade: the port facilities.
“We’re a port city and the gateway to the Caribbean,” Tetow said, which helps explain why approximately 70 percent of equipment recovered by the police was stolen somewhere else.
As for the state’s falling recovery rate, the assumption of Tetow and fellow task force members is that some of the equipment is quickly being shipped overseas. Selling stolen machinery is relatively easy inside the country. The only reason thieves go to the trouble to export it, the NER report surmises, is because they can get more for the machinery somewhere else.
It should be noted equipment theft is not solely an American problem. Such thefts are calculated annually in the millions of euros across Europe. Australia is plagued by it. In many developing nations, the equipment of the developers is targeted.
A second economic crimes unit in the Miami-Dade agency also is assigned to follow up on heavy construction crimes: the auto theft unit. It is concerned with stolen vehicles, obviously, but also jumps on the trail of stolen boats, motorcycles and construction equipment. Lt. Greg Terp echoes Tetow about Miami being a destination for stolen machinery.
“You have to understand,” he said, “that a lot of the stuff we see coming through Miami is stolen elsewhere. We see a percentage of that going abroad.”
He wouldn’t speculate what that percentage might be. The department recently was contacted, for instance, by the Houston Police Department regarding stolen heavy equipment. On the other hand, Miami-Dade officers recently worked with authorities in Mississippi to recover equipment stolen from Dade County.
Industry leaders who wrestle with the stolen equipment crime wave recognize there must be several answers to reducing it. After all, law enforcement agencies are effective in preventing thievery and tracking down thieves, but they cannot be expected to solve it by themselves.
Law enforcement and court systems need the right tools to capture and prosecute suspected thieves, for instance. North Carolina is a case in point.
Dave Simpson is the North Carolina director of Carolinas Associated General Contractors’ (AGC) building division. He said the equipment loss problem in North and South Carolina is “huge” and widespread across both states. The NER ranks North Carolina No. 2 in frequency of thefts for 2004. South Carolina isn’t far behind at No. 9.
The Carolinas AGC is going to the North Carolina General Assembly for help. The organization is lobbying for a bill that would increase penalties for the thefts. Simpson said it is apparent that thieves in his state know that if a piece of stolen equipment or stack of materials is worth less than $1,000, they will be charged with a misdemeanor. That is little deterrent. He wants job-site theft generally to be a felony. The AGC also wants tougher penalties for thefts in the upper end of the equipment value range.
Harsher penalties are not “a panacea,” Simpson acknowledged, but they can help convey the message that society is serious about protecting construction company property.
Shillingford noted that states could raise the ante for crooks simply by registering backhoes, skid steer loaders, bulldozers and other mobile pieces of equipment in the same way that cars and trucks are registered.
“There is no registration now,” he observed. “The equipment is just one of those commodities that isn’t titled.”
Consequently, identifying ownership is more difficult. The lack of identification plays into the hands of thieves who want to dump a stolen skid steer without having to come up with real or forged paperwork.
Skid steer loaders were the most popular machines taken by crooks in 2004, according to NER statistics. Almost a third of all heavy equipment taken was one brand or another of skid steer. Swiping of the handy little machines was up fairly dramatically from 2003. Tractors also are popular with thieves, as are backhoes.
Technology can help reduce the crimes, officials said. A variety of mechanical lock-out devices are on the market that effectively immobilize a machine. Also available are electronic signal-sending devices that, when activated, let police track a stolen machine.
Global positioning systems (GPS) are sometimes incorporated into a fleet of equipment, not as theft protection, but as a way of monitoring equipment usage.
Though it primarily is a management tool, the GPS equipment obviously also can help track missing equipment.
Such technology “shows promise,” Shillingford said, though he adds that “it is too early to see if that is going to work. He noted that the technology needs to be adapted to pieces of equipment that take a pounding off roadways and for long periods.
“It [incorporating technological security devices] is definitely going to have an impact in the long run.”
In the short run, the industry can look to low-tech solutions like chainlink fencing and security lights. Shillingford also acknowledged that just a tad more integrity on the buying end would help the situation. Re-selling stolen equipment is easier than it ought to be.
“If someone is offering a $20,000 machine for $10,000, it either is a bargain or it’s too good to be true,” he said. “Someone who buys it is not asking enough questions.”
The stealing of construction equipment is not going to be totally solved, of course. But it can become a less severe problem, officials said, if law enforcement agencies, industry organizations and contractors, will respond to it in smart ways.
“The drive to improve this will come from the insurance industry,” Shillingford believes.
Claims for stolen equipment eventually will require insurers to raise rates, which will encourage buyers and sellers of the equipment to ask manufacturers for more security features.
Despite NER’s discouraging statistics, Shillingford actually is hopeful. He believes the problem might be cresting due to the variety of initiatives being introduced.
“It is a problem that has been getting worse over the past 10 years,” he said, “and it is going to get better in the next five years.”