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Wed, 13 Aug 2008 05:49:49 -0400

The top of the supply chain

By Erik Hoffer

The Strongest Link.

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Trying to separate fact from smoke:

A critical review of cargo security

Erik Hoffer, Seal Committee Chairman, International Cargo Security Council, NJ, USA

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On the road security

Erik Hoffer

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The costs of loss

Wed, 13 Aug 2008 05:39:37 -0400

Transport profitability is a delicate balance between ones ability to operate efficiently all the while avoiding adversity in the form of damage claims, theft control, asset management, fuel costs and driver turnover to mention a few. Besides being a formidable task, transportation providers seem to compete more on price than on the value added service they perform, therefore losses in any form reek havoc with their bottom line. By dissecting some of the common pitfalls systemic to the transportation industry and evaluating their negative impact to profitability, it is likely that companies can look more critically at funding proactive operational changes to avoid losses than reactive remedies when losses happen. Many of these changes can be seamless to most companies culture, and by their implementation they are able to mitigate or at least reduce the propensity of many types of loss. Most transportation providers are self insured at some level. Many have high thresholds where any short fall becomes their liability. Most contractual arrangements with larger shippers now include limited carrier liability for many conditions of loss including but not limited to damage, spoilage and theft. Many of these situations have contingent liability associated with them which compounds the negative impact should there be a claim. Most asset based providers pay dearly for equipment, maintenance, fuel and infrastructure and view systemic proactive product oriented change as insurmountable and unnecessary. I have personally heard many companies say that they cannot afford a particular technology simply because of their size, yet the cost of loss or profit drain far exceeds the remedy. Telematic solutions have just now impacted the industry where those nay sayers are now outspoken advocates for such solutions. Countermeasure for theft are still a step child to logistic technology but will soon follow although far less expensive and far easier to implement. Physical asset monitoring technology such as measurement tools for brakes and many safety products are gaining acceptance rapidly. Of course GPS is not a security tool nor are door locks any help to operational efficiency yet both product types can easily enhance the profit picture of any company. Theft related losses are particularly troubling as they damage both the brand and reputation of the company. No one wants to align themselves with a �target� as a carrier. No carrier wants to move only high profile and highly vulnerable cargo as his total diet. Theft losses in the US from domestic freight moves easily exceed five billion dollars and affect every facet of the industry. From a missing flatbed with a million dollar piece of construction equipment on it to shoes, food, electronics and of course pharmaceuticals, carriers engaged in the movement of these goods are particularly vulnerable to liability. The smaller the carrier, the higher the financial impact of a loss. The smaller the fleet the higher the cost of equipment related losses because of the impact of a tractor loss has on a companies overall productivity. Damage losses are additionally an undesirable moniker for anyone in transportation. Damage losses exceed theft related claims at a ratio of 5 to one and receive far more proactive attention than do theft losses. Remedy however is typically provided by the shipper and rarely is able to be implemented by the carrier where the inverse is true with theft. Employees cause the vast majority of damage claims through rough or improper handling and operational laxity. Many times, mechanical failure, is a cause of damage but more often than not, damage is a preventable event with reasonable care while theft is uncontrollable and random. Carriers recognize this and can train for it where theft losses are 80% based on employee infidelity and change with operational area, equipment diversity, employee concentration, systems and operational procedures. The most common conditions leading the theft losses can in fact be planned for and many remedies have no physical cost but rather operational changes to address known threats. Losses associated with theft or damage affect the bottom line of the shipper, carrier and the insurance provider as each has a vested interest in seeking appropriate remedy. It is an imperative to choose remedy that benefits all concerned parties and that funding for such changes or products be spread out amongst those prone to bearing the loss. Insurance providers cannot institute remedy but rather incentivised companies through more attractive rates to implement the appropriate technology to reduce vulnerability. Likewise carriers need to explore the cost of loss vs. the cost of remedy to determine their respective role in protecting their interests and those of the client. Shippers have already been socialized into protective packaging and equipment choices to avoid damage yet they have done little to nothing to reduce their risk of theft related losses, even though their exposure is far more costly than the limited liability of the carrier and insurer. By enhancing logistical efficiency, the value proposition to justify GPS and asset tracking technology, was embraced by the trucking community yet at far lower cost per unit, theft control countermeasures remain aloof.

FACT FROM SMOKE IN CARGO SECURITY

Wed, 13 Aug 2008 05:38:48 -0400

TRYING TO SEPARATE FACT FROM SMOKE IN CARGO SECURITY By Erik Hoffer The cargo security initiative is in the development and concept stages. Smoke and mirrors skew the discussions because recommendations presented by many of the experts asked to participate lack the core expertise required to recommend remedy against unforeseen threats. Many of these experts and officials lack a practical understanding of the physics behind seal security and cargo terrorism. Intimate knowledge of intelligence on threat issues is not sufficient background to recommend remedy. Specific knowledge of the physical attributes of security technology is not a substitute for understanding the threat. People who are finally asked to decide on the correct system and course of action may not be intimate with the nexus between science and viable mechanical remedy. Many of those in the know in our Government and those consultants to the government present options based on perceptions rather than facts which can cost everyone dearly. Any approved plan will ultimately attempt to establish a level of container sealing and monitoring integrity for the entire world supply chain. The system should ideally be able to enhance homeland security, by reducing the threat of attack through cargo entering or leaving any port. By developing a workable intelligence security program combined with viable security devices, we should be able to identify suspect cargo before it can be placed on a ship heading to the United States. DHS and Customs and the Department of Border Protection, who seems to be spearheading the project which includes, the plan to cover procedural security for stuffing and shipping containers, physical security for containers in transit, access to ports and cargo yards both here and abroad, personnel integrity checks for cargo handlers, training of personnel on terrorists threats, awareness of the types of threat, secure manifest procedures and conveyance security dealing with the vessels, drays and ports handling, storing and moving cargo. This is a broad-based plan, which requires a considerable amount of technology and refinement before a suitable solution can be found. Implementation must include appropriate physical security products used to achieve containment and control of cargo. Such technologies must be suitable to the real world of container cargo shipping. They must be cost effective for both ports and shippers and able to be readily implemented world wide without development time. Any choice must focus on its ability to detect entry or manipulation of the doors from both an indicative and barrier prospective. Training of personnel must focus on simplicity and consistency which is often lost due to the urgency of this need. Systems that have proven to work in the here and now are the order of the day. Implementation of a system that requires a tremendous expenditure in infrastructure will limit approved ports, which will severely impact world trade. Such a system is both detrimental and prejudicial to shippers and ports that cannot come up to speed and thereby becomes the antithesis of free and open trade. People whose jobs it is to secure cargo and whose goals it is to have a successful cargo security initiative are not the same people. Those who pay the bills to ship, carry, handle, receive or load cargo are truly ambivalent about the implementation of such security procedures, products and systems. Many, if not all of them, see such an implementation as an added cost not a necessary benefit. Since their reality is cost vs. profit, not security vs. an imploded economy due to an act of terror, their prospective is radically reduced. Not that individually they are not concerned about Homeland security, but having 30+ years in speaking with these companies gives the author that skewed viewpoint. Shippers have always faced the threat of financial loss through theft and damage yet proactive reduction techniques are rarely used. Shippers who know the score on cargo theft in the United States, which exceeds 25 Billion dollars annually, still have inherently balked on use of the simplest tools available. The threat has never been higher for theft, tampering, drug smuggling or terrorism, yet the reluctance of most shippers remains consistently steadfast when it comes to the use of security tools at their expense. Even when confronted by a loss, most shippers complain vehemently about spending much more than a $1 on a bolt seal securing a container worth millions. Now that the threat has become more public and it has grown to include terrorism on the list of loss conditions, have shippers begun to recognize their participation in the cure process? Not really. Tampering, smuggling (piggybacking) contraband into legitimate cargo and the use of your container to ship bombs and people around the world is suddenly real. Those who decide how much to spend for protection need to get on board with these initiatives and work as a team with our government to accomplish the mission at hand. With that �penny wise dollar foolish� base mindset, let�s look back at the Customs initiative question and how that relates to the available technologies and viable solutions. From the port prospective: In order for a port to offer any level of security containment without opening every box they must assume that the CSI will help shippers to provide the security sealing when the stuff the box. Cargo in a container is just that, inside a steel box, neither visible nor accountable and highly vulnerable. A total trust relationship must exist between the shipper, dray company, port and sea carrier, who in turn has an implied trust to the receiving port, dray carrier and ultimately to the recipient. If such a relationship were to exist it must be built on secure sealing methods and technology. The control element must be the process and the seal. The seal and system must preclude and easily identify surreptitious opening en route and it must offer a formidable barrier to those trying to open it for any purpose. The most common element for securing a container has been a bolt seal placed through the handle hasp. That product, regardless of brand, manufacturer, quality or features, has only ever been good as an audit tool, and certainly never has offered or claimed to offer security. Seals placed on door handles are so easily circumvented that their utility as a security device is ridiculous. Compromising of the handle bar itself is quite easy; hence any for of seal placed ion the hasp fails to offer and security. Recently an ISO standard 177072 was developed over in Europe by a group of well intentioned scientists. Note that I did not say security professionals, since in my view they are anything but. The perception of the report, which was immediately embraced by many who also fail to have a proper understanding of the vulnerability of the door handle, was immediate. Because they chose not to solicit any other qualified forum, our Government created a mandate regarding the use of this standard and worked from that point forward. Standard are necessary to achieve consistency in most things, however standards that deal exclusively with the physical attributes of a science and not the appropriate application of the technology fail on all front. They create a misperception which is then carried forward and thereby jaundices the process. The ISO standards are clearly a misrepresentation of the facts as they relate to vulnerability. They fail to account for the utility of a seal and focus on the physical attributes. As scientists and not security professionals, their lack of knowledge has set the standards for security back by 4 years. When dealing with a threat such as cargo terrorism, expecting any security from the �now revered bolt seal� would be ludicrous. The next area is the perceived need for real time security information on containers and their contents. It is obvious to anyone that has ever seen a port or a container yard or a ship is that the environment that these containers move and are stored in, is hostile at best. Salt, cold, heat, water, shock, rough handling, stacking and truck mounting are hard on steel much less electronics. Most technologies that have been tried in the past to transmit information from containers fail because they either break down in salt, rust, become damaged and unusable and or they are broken off during transit. To think that a delicate RFID tag could withstand this environment is questionable. The SAIC report dated July 11, 2003 clearly identified their short comings. The report is available on line. CARGO HANDLING COOPERATIVE PROGRAM Program Sector: Agile Port and Terminal Systems Technologies Program Element: Cargo, Equipment Tracking and Identification Technology Demonstrations Task Title: Container Seal Technologies and Processes Phase 1 Final Report July 11, 2003 To try and place sensitive and expensive electronic elements into or on to a container and ask that they be monitored by a port security system would be asking for trouble. Who will pay for it? Can it be recovered? Who is responsible to monitor it and where? How will we affix it to the containers? Can it stand up? What will it take to read it? What frequency will it operate under? What are the standards? What software will be chosen? Who owns the problem it if it fails? Products such as active RFID tags have been touted as the coming technology for almost 5 years but they fall way short of viable in security. In fact they offer no security at any level. They barely have been used in any industry because they cannot be read around or in contact with metal, they cross talk, they break, the batteries wear out, they cannot take abuse, they are expensive and this just touches on some of their short comings. They are great in a controlled environment as locators, as inventory tools and as data collectors; they are not ready for security applications. RFID tags are expensive to use, to own, to verify, to get back and to audit. To analyze the RFID industry as it relates to security you need to understand very basic electronics. Radio signals are blocked by metal such as containers are made of. Hundreds of containers in a yard facing different directions require many expensive antennas and a costly infra structure system. Each system of each manufacturer may be different so which will people use since there is no agreement on an electronic operating platform? Electronic readers needed to interrogate active tags are typically antenna based and must be deployed throughout a container yard. This infrastructure requirement would be extremely costly and provide little else than a location scan but with many serious shortcomings. RFID tags can be removed and replaced, they can be broken off and therefore not read at all, making that container invisible without a physical check, which makes the need for RFID redundant if you have to go out and find it. The tags need to be applied at origin. Can you see shippers in Jakarta holding up a shipment because they need tags! RFID tags have no relationship to the lock mechanism hence they provide no security at any level just location and data if they were to work. Tags are expensive and must be funded by shippers who will get no tangible benefit from them and no possibility of recovery and re-use, hence no cooperation. The tags must be able to be read at every port and by every carrier in order to render any level of reliable real time information. The infrastructure of many foreign ports has not reached the computer level much less RFID readers. The information is only as good as the software and interfacing software between many companies and operating systems is a joke. Rights of authorship on the choice of software and hardware out of all of the existing tag manufacturers would begin WW#3 in the industry. The requirements of a port to implement a new infrastructure to accept all possible tags and integrate them to one common LAN to read them would be a 5-year project at best. To accept RFID information implies that the tags would solve some portion of the problem when in fact they would create a logistic and data base nightmare. By the way, the data collection and retention element of RFID has now become a tremendous debate. No one wants their information regarding shipments, volumes, frequency, supplier and recipient data floating in cyber space. Without physical interaction with the container and its lock or seal you can never be certain that the box was never opened, only that the tag is somewhere in your yard hopefully still attached to the original container and not on the floor! Security can only be achieved when it begins at the beginning, offers the appropriate protection based on the threat and has audit characteristics and physical checks throughout the logistic cycle. Being critical is only useful when you can support that doctrine with credible solutions. Containers are unprotected storage warehouses that have many ways to beat them. Nothing can be done to secure a container completely, however the fact that the doors are the easiest and most readily available portal of entry dictates that they be the first line of defense. Barrier defense systems work best to keep people out yet indicative systems make it easier to detect if someone got in. To avoid surreptitiously entry, a good system will employ both indicative seals such as self voiding door seals and barrier seals such as cables or locking bars. Locking bars secure the keeper bars of the container itself and prevent the door from being opened. The fact that lock bars keep out everyone without a dremil wheel means that they are the most suitable barrier device available. These are typically cost effective tools that area easy to apply and impossible to remove with common tools outside a cutting wheel. Cables seals which also wrap and retain the keeper bars present a reasonable second tier approach. They are removable with bolt cutters, but they typically cannot be replaced as a bolt can. Last but not least are indicative self adhesive seals applied across the doors to indicate openings? Indicative sealing devices used without visual scrutiny yield no results. All security seals and security countermeasures require a detailed written plan, training and consistency. No security product can offer complete protection yet when used correctly, consistently and monitored bars, cables and seals can give us a leg up on protecting the worlds supply chain.

Selecting the Right Cargo Security Seals

Wed, 13 Aug 2008 05:37:24 -0400

Between terrorist threats and criminals looking to swindle goods, cargo security seals have grown increasingly more important -- and more sophisticated. Companies can now choose from a variety of mechanical and electronic seal options to protect their freight. To help narrow the choices, Erik Hoffer of CGM Applied Security Technologies Inc., a unit of New Jersey-based Digital Descriptor Systems, offers 10 tips for selecting the right cargo seals. May 2006 | List all 10 Tips articles Selecting the Right Cargo Security Seals By Deborah Catalano Ruriani Between terrorist threats and criminals looking to swindle goods, cargo security seals have grown increasingly more important -- and more sophisticated. Companies can now choose from a variety of mechanical and electronic seal options to protect their freight. To help narrow the choices, Erik Hoffer of CGM Applied Security Technologies Inc., a unit of New Jersey-based Digital Descriptor Systems, offers 10 tips for selecting the right cargo seals. ________________________________________ 1. Understand what you are protecting. Companies need to evaluate the nature and level of threats to their cargo and/or vehicles. Are you worried about theft or tampering? Do you own the goods or are you simply liable for theft or potential damage? Perform historical research on your products' vulnerability to theft, your carriers' theft history, and your supply chain vulnerability as it relates to packaging and unit volume. Evaluate each seal category for its relative effectiveness in the environment and conditions in which it will be used. ________________________________________ 2. Determine the value of your loads to thieves or terrorists. Some products are more likely than others to be stolen. High-priced computer equipment, drugs, electronics and machinery are attractive to thieves, while terrorists may target explosives, gases, or corrosives. Where products fall on that scale can help determine the type and strength of seal you need. Different security threats require different seals. Many hazmat items, for instance, travel in tankers. Hatch seals for vehicle tankers require cables, but tanker railcars have built-in locking mechanisms that can only be opened with specialized tools. In these cases, a less robust steel cable seal should suffice. ________________________________________ 3. Educate yourself about seals. How can you know what type of seal you need if you don't understand their differences? Indicative, barrier, and electronic seals are most commonly used. Indicative seals change shape or visual composition when tampered with, while locking bars and cable seals cannot be re-secured if cut. In both cases, it is necessary to visually inspect the seal, compare its numeric identifier, and determine if it was manipulated during transit. Bolt seals, lock bars, and cable seals are barrier seals but physical properties are not the criteria to judge their ability to defend your load. The seal's placement on the door is the main criteria for effectiveness. Electronic seals are embedded with an RFID chip that provides tracking capability, but they rarely provide physical barrier security. ________________________________________ 4. Analyze your shipping modes. Do you move products via trailer, container, pallet, or small parcel? Perhaps you use a combination of shipping containers? The transport mode you use to ship products determines what kind of seal you need. For shipping small packages, such as jewelry, computer chips, or cameras, packaging seals -- either self-adhesive seals or pallet-locking steel topp clips -- enhance security and allow the consignee to see if a package was violated. When shipping a full truckload or containerload that moves from origin to destination without breakbulk, a locking bar or wrap-around cable seal effectively bundles the entire shipment. Pallet seals for these conditions are redundant and do not effectively secure the load. On the other hand, an LTL shipment of products such as pharmaceuticals or fragrances, is best secured by pallet covers and topp clips. ________________________________________ 5. Get a handle on customs regulations. If you send shipments to international destinations, you need to understand Customs and Border Patrol's (CBP) shipping rules, and consequently purchase the correct seals. This is easier said than done. The recent ISO/PAS 17712 mandate, for example, requires carriers and shippers to secure cargo, but does not delineate any specific requirements for container shipments, or shipments that come from or go through Canada or Mexico. This mandate gives shippers a set of physical standards to adhere to but, as stated by ISO, they are minimum standards for seal choice, not seal application. ________________________________________ 6. Analyze how easy a seal is to install and remove. It is challenging for many shippers to apply even a bolt seal correctly, and many consignees fail to understand how to inspect seals upon delivery. Though you may select a seal for its ability to secure a load, it does not mean your consignee will accept it. Provide carriers and consignees with training and a reasonable template to help them validate the seal at all times, and ensure that consignees have the proper tools and knowledge to remove the seal once a shipment is delivered. Select seals in concert with your carriers and consignees to help effectively protect the load, regardless of who has care and control of it. ________________________________________ 7. Examine the seals' ability to be inspected outside the normal chain of freight custody. Can non-skilled inspectors look at the seal and understand that it was breached? Can an anomaly be easily detected even if the inspector is unskilled? Cable seals with expanding wrapped wires, for instance, will easily show a cut, just as a self-voiding indicative seal will say "opened" on its surface if anyone has attempted to remove it. Any aspect of the seal that can be implicitly understood as a possible breach is a positive factor in seal choice. If a seal is cumbersome or requires forensics to determine penetration or bypass, then it has limited utility as a security device. ________________________________________ 8. Look beyond price. Too often, price is the deciding factor in seal selection. To ensure the security of freight in transit, you will have to spend money -- it is simply a cost of doing business. Select seals based on their quality and appropriateness for your cargo type, shipping mode, and physical environment first, then shop price. Look for vendors who help customers choose the correct seal, and use them as a free resource. ________________________________________ 9. Understand the accountability of seals at origin. If a seal can be replicated or if sequential numbers are not used, it can become suspect. Without sufficient standards for the issuance and control of the seals, their effectiveness is diminished. When one or more sealing method or product is employed simultaneously, inspectors can validate containment throughout the logistics cycle. Each packaging and bundling component needs its own unique seal type. When an indicative seal is used in combination with a barrier seal, both threats are easily addressed and the load remains exponentially more secure. ________________________________________ 10. Investigate quality and solicit quotes and data. Invite seal manufacturers to talk with your staff and demonstrate their products. Have vendors explain their lock and seal techniques, then do your own "black hat" comparison before making a choice. Examine their seals' compatibility with CBP requirements and suitability to your supply chain. In addition, explore remedy with your insurance carrier. Underwriters will help steer you in the right direction. Do not choose seals in a vacuum, as you may not be up to date on your cargo's "threat de jour."

TO EAR MARK OR NOT TO EARMARK, THAT IS THE QUESTION.

Wed, 13 Aug 2008 05:35:57 -0400

MANY OF OUR CLIENTS HAVE ASKED ME WHETHER OR NOT PUTTING A SUPER SEAL TAMPER EVIDENT MARKING ON A PACKAGE IS OF VALUE IN DETERRING CRIME. THEY WANT TO KNOW IF THE SUPERSEAL ITSELF BECOMES THE TRIGGER FOR A THIEF TO RECOGNIZE THAT THE PARTICULAR BOX CONTAINS VALUABLE GOODS. IS THE EARMARK THE SEAL OR IS IT THE GOODS? I HOPE THAT THE EXPLAINATION TOP FOLLOWS HELPS TO BRING OUT SOME ANSWERS TO THIS QUESTION. THE NATURE OF A SECURITY TOOL SUCH AS OUR SELF VOIDING SUPERSEALS IS TO IDENTIFY CONTAINERS AS PILFERED. SUPERSEALS THEREBY ALLOW THE USER OR RECIPIENT TO CONTROL HIS LOSSES BY NOT ACCEPTING TAMPERED BOXES IN GOOD ORDER, EVEN IF THEY APPEAR TO BE IN TACT. SUPERSEALS EFFECTIVELY DO THIS IN TWO SIGNIFICANT WAYS. FIRST, BY CREATING A VISUAL CHAIN OF CUSTODY MONITORING TOOL IT ALLOWS THE SHIPPING, LOGISTIC AND RECEIVING PARTIES COLLECTIVELY, TO MONITOR THE BOX FROM POINT TO POINT. WITH A CLEAR VISUAL RECOGNITION OF A BREACH THE SEAL FUNCTIONS AS A SECURITY GUARD FOR THE BOX. SUPERSEALS EFFECTIVELY ALLOW THE BOX TO BE MONITORED BY EVERYONE COMING INTO CONTACT WITH THE BOX. ALL EYES LOOKING AT THE PACKAGE SHOULD BE MADE AWARE OF THE USE OF THE SEAL TO INCREASE ITS MONITORING POTENTIAL. POSSIBLE ENTRY INTO THE BOX CAN THEREFORE BE RECOGNIZED AND THEREBY ALLOW EACH OF THEM TO STOP THE BOX AT ANY POINT IN ITS MOVE. BY AFFORDING THE RECIPIENT A CLEAR VISUAL INSPECTION TOOL BY WHICH TO RECEIVE THE BOX IN GOOD ORDER, IT ENABLES A CHAIN OF CUSTODY LOOP TO CLOSE IN ON THE CONTAINER AND POSSIBLY THE THEIF. THE USER OF THE SEAL ALSO GIVES NOTICE TO HIS CUSTOMER THAT HE IS TAKING A PROACTIVE APPROACH TO SECURITY TO INSURE THE INTEGRITY OF THE CONTAINERS HE SHIPS. BY DOING SO HE ALSO NOTIFIES THE CARRIERS THAT THEFT IN TRANSIT WILL NOT BE TOLERATED AND THAT LIABILITY FOR THESE LOSSES WILL FIND ITS WAY TO THE PERPERTRATOR RATHER THAN GO UNNOTICED AND BE WRITTEN OFF AS SHRINK. BY RECEIVING THE SEALED PACKAGE IN GOOD ORDER, THE RECIPIENT KNOWS THAT IF THE BOX DOES NOT CONTAIN THE MANIFESTED ITEMS, THEN THE HIGH LIKELIHOOD IS THAT THE BOX WAS SHORT PACKED. IT CONVERSLY CAN TELL THE CARRIER THAT HE IS CLEAR OF ALL LIABILITY OF SHORTED GOODS AS THE PACKAGE ITSELF, IS PROOF POSITIVE OF THE FACT THAT IT WAS DELIVERED IN GOOD ORDER AND SHORTAGE OCURRED ELSWHERE. BY HAVING ALL PARTIES IN THE LOOP, IT INSURES THAT EVERYONE IS AWARE OF THE SYSTEM AND ITS USE IN MITIGATING TRANSPORT PILFERAGE. BY EDUCATING THE CARRIERS YOU INSURE THAT MORE POLICEMEN IN ROUTE ARE ACTIVELY MONITORING THE INTEGRITY OF THE FREIGHT. IF SUCH A SEAL IS NOT EMPLOYED, THE SPECIFIC BOX BECOMES JUST ANOTHER CONTAINER, LIKE ALL THE REST, THAT BLENDS INTO THE SHIPPING SCHEME MUCH THE SAME AS SINGLE ROCK DOES AMONG MILLIONS OF DRIVEWAYS STONES. WITH A SUPER SEAL IN PLACE, THAT ROCK STANDS OUT AS A BEACON AND IS AUTOMATICALLY SEEN BY EVERYONE HANDLING IT. SO TO MAKE A HIGH VALUE BOX MORE SECURE, YOU NEED TO ALLOW SOMONE OTHER THAN THE THEIF TO SEE AND MONITOR IT. TO BE OF THE OPINION THAT A CARGO THIEF IS TAKING RANDOM SHOTS AT CONTAINERS TO HOPEFULLY FIND THE �GOLD�, IS TO BE NIEVE. CARGO THIEVES ARE AWARE OF THE GOODS THEY WISH TO STEAL WAY BEFORE YOU ARE! JUST THINK OF IT IN THIS LIGHT. THE PICKUP DRIVER KNOWS WHAT YOU MAKE OR DO. HE HAS THE DESTINATION, THE MANIFEST OF GOODS SHIPPED, THE WEIGHT OF EACH BOX, THE INSURANCE DOCUMENTS IF ANY, THE PACKAGE ITSELF AND THE TIME IN WHICH TO DETERMINE IF THERE WILL BE ANY PROBLEMS OPENING THE CONTAINER. HE HAS MORE OF THE SAME CONTAINERS, HE PROBABLY HAS MORE OF YOUR OWN TAPE, HE HAS A CLOSED TRUCK AND A TREMENDOUS AMOUNT OF PRIVATE TIME WHILE ALONE IN THE TRUCK TO MAKE HIS DECISIONS AND PILFER THE CONTAINERS. THE LOGISTICAL PEOPLE AT THE DISTRIBUTION CENTER FOR THE CARRIER HAVE THE BOX SEGREGATED INTO THE �HIGH VALUE� CAGE AND, ALTHOUGH THEY HAVE NO REAL PRIVATE TIME, THEY DO HAVE THE ABILITY TO SWITCH BOXES OR PASS THROUGH A DAMAGED BOX WITHOUT HAVING ANY IDENTITY OF THAT BOX TO THEM PERSONALLY. THE DELIVERY DRIVER KNOWS THAT HE IS DELIVERING TO A JEWELRY STORE OR LIKE HIGH VALUE RECIPIENT. HE HAS THE TIME, THE BOXES AND MORE LABELS AND CLEAR TAPE. HE KNOWS THAT IF HE GIVES YOU 20 BOXES AT ONCE IN A MANNER CONSISTENT WITH A CRIMINAL MIND, THAT THE SLIT BOX, BURIED ON THE BOTTOM, WILL PROBABLY GO UNNOTICED. HE KNOW YOUR SYSTEM AND HIS. HE HAS HAD A REASONABLE AMOUNT OF EXPERIENCE TO TELL HIM THAT HE CAN GET AWAY WITH IT AND HE IS BRAZEN ENOUGH AND SMART ENOUGH TO STEAL AT ALL THE RIGHT TIMES. BY AND LARGE, MOST EVERYONE IN THE MOVEMENT CYCLE KNOWS WHICH BOXES TO HIT AND WHICH ONES TO LEAVE. IF GUESSWORK WERE THE ONLY ACTIVE INGREADANT TO CRIME, NO ONE WOULD HAVE ANY APPRECIABLE THEFT. BY PLACING A SEAL ON THE BOX, YOU THEREFORE DO NO MORE TO IDENTIFY THAT BOX TO THE PERPETRATOR, THAN JUST THE MERE PICK UP DID. THE FACT THAT HE NOW HAS A BARRIER TO THE THEFT OF YOUR PRODUCTS, WILL ALMOST ALWAYS, FORCE HIM TO RECONSIDER THE THEFT OR GO TO ANOTHER MORE EASILY COMPROMISED BOX OF LIKE PRODUCT. A PICK UP DRIVER IN THE JEWELRY DISTRICT OR IN SILICONE VALLEY AS AN INNUMERABLE AMOUNT OF CHOICES. HE DOES NOT CARE IF IT IS YOUR COMPANY OR THAT OF YOUR COMPETITORS, HE TREATS ALL OF YOU THE SAME. THE THEIF IS AFTER GOODS TO CONVERT TO CASH AND DOES NOT CARE WHOSE THEY ARE. WHY RISK HIS JOB, HE WILL THINK, OVER A PROTECTED PACKAGE WHEN THERE ARE SO MANY MORE FISH! WE HAVE HAD MORE THAN 2 MILLION SEALS USED DURING 1994 AND WE HAVE FOUND THAT STATISTICALLY YOU CAN ALL BUT ELIMINATE THEFT FROM THE CONTAINER WITH THE USE OF SUPERSEALS. WE HAVE FOUND THAT PACKAGE THEFT ALL BUT DISAPPEARS IN THE FIRST SIX MONTHS. WE HAVE FURTHER FOUND THAT A MISSING BOX IS THE FIRST APPRACH TO A THEFT OF A PROPTECTED PACKAGE, BUT THAT AFTER A FEW TURN UP MISSINGH, THEFT DECLINES TO ZERO. THIS FACT, DEVELOPED THROUGH OVER 50 CLIENTS, PUTS TO REST THE NOTION THAT AN EARMARK IS CREATED BY THE USE OF A SEAL. THE BARRIER TO CRIME GAINED BY THE USE OF THE SEAL RENDERS IT AN EXCELLENT CHOICE IN AN OVERALL SCHEME OF PACKAGE SECURITY. THE USE OF A SUPERSEAL IS QUITE SIMPLE. BY REMOVING THE SEAL, A PERMANENT WORD APPEARS ON THE CONTAINER MARKING IT AS SUSPECT TO THE RECIPIENT. BY SLITTING THE SEAL OPEN AND THEREBY OPENING THE CONTAINER, THE THIEF MUST RESEAL THE BOX TO AVOID DETECTION. BY SO DOING, A WORD, TYPICALLY �OPENED� APPEARS IN THE CENTER PORTION OF THE TAPE, OBER THE BOX OPENING JOINT, AFTER APPROXIMATELY A FEW HOURS. THIS GIVES THE THIEF PLENTY OF TIME TO REPLACE THE PACKAGE TO AND FEEL THAT HE HAS AVOIDED DETECTION. AFTER A FEW HOURS, IF HE APPROACHES THE CONTAINER AGAIN HE WILL SEE THE WORDS OPENED HAVE APPEARED IN YELLOW ON A WHITE FIELD IN THE CENTER OF THE SEAL. IF HE THEN TRIES TO REMOVE THE TAPE, THE WORD OPENED APPEARS IN WHITE ON AN ORANGE FIELD, GIVING SUPERSEALS THREE BASIC LEVELS OF REDUNDANCE. AS SEALS ARE TYPICALLY NUMBERED AND THEY ARE ALWAYS MADE INDIGENOUS TO EACH CLIENT COMPANY, CONTAINER TAKE ON THEIR OWN PERSONAL IDENTITY. AT THIS POINT THE THIEF MUST CHOOSE WHETHER OR NOT TO LEAVE THE TAMPERED BOX AS EVIDENCE OF THE CRIME OR DESTROY IT. IF THE BOX IS REPLACED, IT WILL ARRIVE WITHOUT A SUPERSEAL IN PLACE, RENDERING IT PILFERED. IN EITHER CASE THE CHAIN OF CUSTODY LOOP IS EFFECTIVEY BROKEN AND THE CARRIER BEARS THE RESPONSIBILITY FOR THE LOSS. IN USING A SYSTEM SUCH AS THIS THE SHIPPER BENEFITS BY SECURING HIS BOX IN A PROVEN WAY SO AS TO REDUCE HIS LOSSES BY PILFERAGE. THE CARRIER BENEFITS BY BEING ABLE TO HAVE A FORENSIC PROOF OF TAMPERING SO THAT HE CAN TAKE STEPS TO FIND THE THIEF. THE INSURANCE COMPANIES BENEFIT BY HAVING SPECIFIC INFORMATION ON WHO STOLE THE GOODS SO AS TO RELIEVE NON INVOLVED PARTIES FROM LIABILITY. THE RECIPIENT BENEFITS BY BEING CERTAIN THAT GOODS RECEIVED ARE IN GOOD ORDER AND HAVE NOT BEEN TAMPERED WITH. THE USE OF SUPERSEALS IS THEREFORE A WIN ALL AROUND SYSTEM. WHAT MAKES SUPERSEALS EVEN MORE ATTRACTIVE IS THEIR LOW COST OF USE. WITH A TOTAL UNIT COST OF APPROXIMATELY $.20 CENTS PER SEAL, NO ONE SHIPPING HIGH VALUE GOODS CAN JUSTIFY WHY NOT TO USE IT. THE NORMAL COST OF INSURANCE IS FAR GREATER THAN THIS AND THAT DOES NOT ELIMINATE OR REDUCE THEFT, IT MERELY HIDES IT BEHIND A �SHRINK ELIMINIATION SYSTEM, THAT IS HIDDEN BY MOST COMPANIES AS A WRITE OFF. BY LOOKING AT ITS USE IN TERMS OF INCREASED EARNINGS PER SHARE ITS USE BECOMES AN EASY DECISION. WHILE NO PRODUCT CAN STOP THE THEFT OF THE ENTIRE BOX, THIS PRODUCT IS THE BEST APPROACH TO PLACING THE APPROPRIATE BARRIER TO THEFT AND TAMPERING THAT EXISTS ON THE MARKET TODAY.

DETERRENCE VS RECOVERY

Tue, 12 Aug 2008 17:54:39 -0400

In the most personal sense, getting your possessions back after a theft is of real importance. The memories, the attachment, the sense of closure and the reversal of the personal violation make recovery the most important factor in the tragedy. This is debatable however in a corporate sense. Recovery of items such as computers, pharmaceuticals, specialized machinery, and time dated items such as clothing, explosives or cosmetics is less than favorable. For example if a theft of a container of non prescription drugs combined with personal health care items was taken on 1/1/01 the investigation, claim application and reporting mechanism would basically begin a few days thereafter. The shipping company would soon receive routing information, values, contents, carrier documentation and like information and then their investigator would begin his project. He would notify the appropriate police and federal authorities, he would call his insurance company and get an assigned claim, and he would interface with his logistic department or outside source and coordinate the project. This all takes time. The typical assembly of data, reporting and coordination cycle takes weeks, if in fact this person has the appropriate time to begin this project immediately. These responsibilities are frequently divided up among risk departments, security, logistic and outsourced groups which are tasked with other jobs and often fail to respond immediately to the incident. The collection of data is by far the most time consuming and cumbersome endeavor of the survey. Tracking the cargo especially in intermodal moves is difficult. Chain of custody data rarely is easy to come by and the time it takes to collect that data can be week. By the 3rd or 4th weeks after the initial claim the investigator has assembled his work sheet and begins to travel to the last point of recorded custody. His time is now consumed with interviews, copying documentation, checking signatures, evaluating the practices of the carriers and handlers of the cargo and interfacing with local law enforcement. As any investigator will tell you, local law enforcement in cargo theft situations is less than responsive to your requests for help. Property crimes in the US rank right near parking violations and j-walking. Exceptions for explosives, crimes of violence and the like are dismissed as extra work and rarely produce results. The occasional recovery of an empty trailer and tractor make the papers, but these recoveries are fortuitous and typically happen by luck rather than by design. Data collected, the investigator begins tracing and doing interviews with sites handling the cargo. Availability of personnel is difficult at best and his costs of travel begin to mount. Other claims are building up on his desk back at the office and he is constantly reminded of priorities and organizational responsibilities. In the weeks that follow, the original client has received a replacement shipment. The company has disrupted their manufacturing and warehouse operations to replace the lost lots and the reshipping and rebilling processes are completed. The investigator has a line on a possible gang operating in one of the intermediate terminals of the carrier. He has singled out a person and he has a lead on the cargo. The interview yields a give up and results in three arrests and a 25 percent recovery of the truckload of products. Because the fence was filling orders, he had broken down many of the pallets and repacked some of the products to meet demands of his clients. He had removed some labels that would have assisted investigators in tracing items and he sold 75 percent of the cargo locally. These goods made the streets quickly and were sold competitively by reputable companies at deep discounts. The manufacturer certainly was not aware of these sales partially due to his size and market share but also due to the fact that he has a tolerance for 2 percent shrinks on an annual basis. This tolerance makes thefts such as this disappear on the balance sheet and are no real cause for alarm. In the mean time the arrested thieves are released on bond and are free to return to the work force. The reporting mechanism for people such as this s rarely in force and they are quick to find other work in a competing carrier to reorganize and get back to business. The investigator returns to his home office to begin the process again. His expenses now total to $7500 for the 3 weeks of road work and he has successfully recovered 25% of the cargo. The recovered materials are collected, repacked and palletized and moved to a storage warehouse where they will remain for some time as physical evidence. The report of the recovery is shared with the insurance carrier who promptly updates his records deducting the value of the goods from the claim settlement proposal. The goods were originally shipped at a contract rate which was negotiated by the traffic department. The rate and valuation were done at a cost base far below retail or wholesale value. The goods were therefore classified as below their rightful value. The recovery gave the goods back to them to resell but such a sale is difficult to do at the original price. The client, if you recall, had already gotten his shipment and the goods now need be released from impound and then repacked, re-inventoried and resold, if possible, from stock. The goods now have to be evaluated for quality assurance; defacing, possible tampering, contamination, and the vast array of problems that can ensue from misappropriate storage, handling or shipping. The goods now have at least tripled in cost, but reduced by more than half in real value. The net result is that they may have to be destroyed, but only after significant resources are put into their evaluation and reconditioning. The basis for the recovery and associated expense has a truly negative impact on the bottom line of the company. If the goods had been completely lost, insurance payment made less deductible, the company would be ahead of the game. Now with the recovery, which is incumbent on any security department to do, the company has gone deep in the hole financially speaking. The nature of theft control is most often misunderstood. Had the company researched the costs of loss vs. the costs of preventing the loss in the first place they would find that the value of prevention is miniscule by comparison. The fact that recovery after theft with many products can never be deemed financially sound speaks to the fact that most corporate logistics department does not understand the process. By seeking out proven methods of containment, setting shipping standards, creating appropriate documentation for carriage, assigning liability parameters to carriers and their agents and by protecting goods physically one can save money in the long run. Many organizations exist to aid shippers in accomplishing these tasks. Groups such as TAPA the Technology Asset Protection Association recommend best practices in shipping and help you to do carrier audits. The TCPC or Transportation Consumer Protection Counsel Help develop appropriate shipping documentation and to assess threats and liabilities of goods out of their control. Finally the basic understanding o the true costs of theft losses, help decision makers create more secure shipping environments. The costs of loss for items stolen in the supply chain include the following items: remanufacturing, disruption of normal business activities, human resources dedicated administration of the loss, claims, client relationships, reselling, investigation, increased insurance costs, loss of markets and sales controls, liability due to misuse, misrepresentation, tampering, loss of trucks and trailers in addition to cargo, dissatisfied clients, unavailability of goods, venue for seeding counterfeits and or diverted gods into these shipments and many more. The costs of protection are dwarfed by these real expenses. The negative however is that protection must be consistent. It must be used throughout the operation since theft can happen any where at any time, based of course on the vulnerability and desirability of the goods. The cost of prevention needs to be compared to the costs of loss to make a decision. The tolerance level of loss acceptance plays a significant role in this decision process. Either way the decision to protect ones interest should always focus on what is best for the business. Protection costs rarely are out of the reach of any manufacturer from the lowest cost to the highest cost item. Protection techniques at times have no real cost as they are protocol of documentation based. These items should never be omitted from any company�s logistics procedures. How can deterrent type proactive technologies address cost savings when they are extraneous costs of products, rarely define in the cost of goods equation. The costs of protection can be both as simple as process controls and as complex as using tamper evident devices on goods, containers or rail cars. Once a deterrent is put in place it sends a message to the delivery carrier that some degree of scrutiny will be given to insure te integrity of the load he is to deliver. It also tells pick up drivers and carrier agents that the company is proactive in security and that theexpectation is made to include them in this endeavor. The risk established by putting carriers, shipper agensts and manuactiring personnel on notice is imeasureable in deterring theft. By establishing a clear auditable chain of custody handler of cargo recognize their risk of getting caught and find easier targts of opportunity. This condition permeates throughout the logistic chain and causes each handler to recognize the risk of getting caught if he attempts t steal. Risk creates a more secure environment for goods and facilitates the cargo protecting itself while out of your care ad control. By deterring theft you create wealth. By reducing the propencity for loss you create profits, based again on the understand that inherent business risks of losses do ext all of the time. By understanding that lost or stolen goods adversely affct your ability to be profitable, you actually create profits by reducing loss.

TRUCKS AND THEIR CARGO ARE THE SOFTEST TARGETS FOR THIEVES

Tue, 12 Aug 2008 17:53:24 -0400

The truck transportation system in the United States is probably the single most vulnerable and also the single most important cog in our economy. The very economic health of our Nation relies on the safe and secure movement of cargo. As they say, �Good Stuff, Trucks Bring It!� The truth is that not only �good stuff� but �most stuff� is brought by trucks. Trucks and trailers are no more than moving warehouses with no gates nor guards. Left alone, the system works just fine. In the event of an act of economic terrorism through the use of a truck we virtually shut down our highways and our ports. A weapon of mass effect delivered by a truck immediately brings our economy to a screeching halt. Remember the port strike of 2004. This economic event caused billions of losses to companies, to people and certainly to the transportation industry as a whole. How long would it take to reconcile a bomb in a US port? As a nation, we need to look more closely at the vulnerability of all vehicles; including busses, garbage trucks and fire engines. These vehicles can easily be used to deliver a weapon almost at will. Who will challenge a fire engine racing down a main street or towards a bridge? Who will know that Greyhound bound for Houston is ill intentioned? The key to transportation security must lie with both the operator to employ security procedure and products and to the owner to provide these tools and training. Collectively, operators on the whole, are infrequently owners, so the thrust of security countermeasure funding must be focused on owners and municipalities. Providing security is a requisite and inherent responsibility of the industry that most benefits from their use. Owner operators are also key to the success of any program and they must also play a role in the deployment of these devices. The fact is they have more to loose that larger companies in many theft related incidents! Just like Highway Watch has empowered drivers to assist in National security efforts, so must the awareness created by the magnitude of the threat of cargo terrorism be brought into the spotlight for the trucking industry. In a recent visit to the TMC and to the Mid America truck show, the author saw little awareness and even less focus on these threats than you would expect. More people seemed interested in chrome and flash than security technology. How can the transportation industry choose the best methodology to reduce their unique risk while not breaking the bank on security technology? With all the hype on GPS and electronics, transportation providers often get confused between what is a logistic tool and what is a security tool? The answer to security rests in the development of a threat assessment, germane to your place in the supply chain, vs. to cost to implement a suitable defense. To develop such a plan you need to begin with an understanding of what you have to fear, how your company would suffer from a catastrophe or theft, your resources, what the cost of an event would be to you, what your cost of recovery would be, the damage an event would do to your brand and a basic understanding of your inherent vulnerability. This is called a threat assessment. Threat probability is not an exact science, and as such can be developed by most any logical means you desire. Metrics do help to tell any story better that simple discussions which diminish the real cost of a loss. By the use of a simple system where you assign a metric to each category of loss and the probability of each condition happening. You come up with an understandable chart. If you come up with high probability at an affordable cost to prevent it, your can act accordingly. If you come up squeaky clean with little to no chance of suffering and event, and then of course you need not fret! A typically threat matrix would look like the following chart: Event Probability Cost of Loss Per event Recovery time Bomb Placed in Truck Delivered to Store M $1,000,000+ Loss of Life Months Tanker used to Blow up Bridge M $10,000,000 + Loss of Life Months Truck Stolen and Shipped to Cuba Contents taken M $200,000 Truck Cargo? Lost opportunity cost $250,000 Months Bus Stolen and Driven into building With Explosives M $Millions Months Fire Truck used in The same manner M $Millions Months Truck Stolen and Cargo Missing H $500,000 Weeks Container delivered to a Port and detonated H $Billions Years Delivery Truck entered and Food Contents tampered with M $millions in recalls plus Possible loss of life Months Garbage truck parked in Front of building and detonated M $millions plus loss of Life Months As with anything obvious to us all, threats to our personal security and to our Nations security are real and cannot be discounted or ignored. Threats from thieves and now threats from terrorists can adversely affect us now and for years to come. With six years under our belt after 9/11, we still cannot begin to comprehend the profound adverse affect this event had on each of us. Our very way of life has been rocked and our future has been changed forever. Our economy will be in debt for 50 more years and our sons and daughters are once again off at war. Can this type of tragedy be avoided in the future? Could it have been avoided in 2001? The answer to both questions is yes, but at what cost? By looking at the list of possible events, which would you choose� none I hope, but if one did happen what would that do to our fragile economy? How long would your company take to recover from the loss of your good name or from the loss of your employee�s? What price would you have to pay (or be willing to pay) then to get things �back to normal�? No one wants to think of that possibility but without a basic proactive plan to reduce your exposure to risk, it cannot possibly be avoided. Security is everyone�s business. Building anything from scratch, you need plans and tools. Planning covers the probability, which is all but certain, but tools provide the ability to avoid the event and must be evaluated based on their effectiveness. Tools for security harden the target and create avoidance as a defense. Many of us have a hard time defining the benefit of avoidance. I am frequently told, why spend the money, the problem has not happened to me? Many companies feel that security tools are un-necessary, too expensive or to difficult to use. Anyone can rationalize anything away. Former President Clinton was a great role model for that! Transportation providers and municipalities, along with government, must become realists and fund for both the possible event and a viable defense deployed throughout our transportation system. We need to create the reality of these threats as part of our daily business strategy. While we do tend to create more secure yards and workplaces, we fail miserably in protecting the assets we deploy out on the road. Our vehicles are often parked at warehouses, in truck stops and on clients yards where they are unattended and vulnerable. Yards seem to be more visible to managers and therefore they get more attention. Global Positioning devices in tractors is the current buzz. Our concept of GPS being a security tool is easily debunked by a simple test of the process associated with theft or terrorism. What would you do if you were stealing a truck or hijacking a bus or fire engine that had a GPS system? That answer is simply cut the wire, and zap, you�re invisible. Even if the act were discovered, who would be prepared 24/7 to respond� certainly not law enforcement. The GPS tool has NO effect on protecting the asset from theft and therefore whatever was spent on it dedicated to a security platform or justification is wasted 100%! Drivers know that a piece of tin foil placed over a GPS antenna attenuates the signal from it which makes you invisible until it is removed. Lot�s of unknown trips to Mama can bear that fact out. That is NOT news or a revelation! The use of GPS is logistical brilliant. By serving the owner with real-time data, location and asset information; companies see immediate payback and cost justification. Somehow security tools do not get evaluated in this same way? The power of the GPS platform is truly a profit center. The cost is quickly justified by anyone able to see the advantages of real time knowledge within the transportation industry. What is lacking in business decisions which do not embrace the need for security tools is puzzlement? Isn�t physical security worth the expense? Isn�t physical security on average 1/20th of the cost of GPS? Isn�t the cost an asset loss significantly greater than the logistical value of knowing where your assets are? Let�s see how this shakes out. A fleet of 100 tractors and trailers can employ any number of security devices, but let�s focus on air brake locks for the tractors and trailers. These cost less than $300 per tractor and $400 per trailer. The $60,000 cost is a one time event with an amortization, let�s say over 1 year. The same fleet can use a GPS system at a cost of about $1500 per tractor with nothing active on the trailer. This does not include a monitoring fee of $200 per month each and people dedicated to monitoring these events. If a tractor is stolen the cost of the units is about $125,000, if it is out of service due to the theft, that adds another $200,000 in lost revenue and if it needs to be repaired and services for damage when recovered that adds another $5,000� being conservative. If you lost a load with it you have to add your liability cost to your client (especially if you are self insured) which can be a significant number, easily over $25,000, again being ultra conservative. With a GPS installed operating efficiency is certainly increased, possibility resulting in some monetary savings in a logistical sense, but certainly equaling the cost of the investment in the system. So let�s review, a high probability of loss exists from theft on a daily basis, a high to moderate probability exists of an act of terrorism being carried out through the use of a stolen vehicle, but somehow no justification seems to exist for the mandated use of security tools to prevent these problems? Recovery costs alone out weight any expenditure for common security tools. The fact is that after a loss, the real costs equate to 5 to 25 times the cost of the original loss and in many cases they can higher. Since most truckers and cities are self insured isn�t it remarkable that security tools rarely get on their radar screen for their fleets? What�s out there in the way of devices to deter theft? In order to understand the remedy you need to know the root cause of the problem. Cargo theft in the United States exceeds 10 Billion dollars annually. Most cargo theft is from trucks and rail cars and most occurs while operators are not present. Armed crime, especially in cargo theft is rare. A convicted armed hijacker gets jail time, while a truck thief is prosecuted as a lesser criminal because; by our laws, he has committed an automotive based and victimless crime.. What we define legally as a victimless crime, the person loosing the money or the asset defines as a real out of pocket loss! For an independent trucker that could be his livelihood. Since unattended tractor and trailers have limited means to protect them, air brakes become the first line of defense when attached and out on the road. By locking the bus or tractors air brakes while the vehicle is unattended, you harden the target for a thief. Time is his enemy, and creating a harder target forces him to use more time to succeed. More expended time reduces the desirability of the target and therefore reduces the probability of the event. The TS4A Air brake locks run about $250 for a tractor and basically outlast the vehicle. Air brake locks are also available for trailers. Both systems use no power and both are seamless to the operation of any vehicle with air brakes. Containers hauled by trucks are also defenseless rolling warehouses with tremendous value and little to no defense against entry through the swing doors. Locking devices can be installed by truckers even if the doors are already sealed when these units are picked up at dray yards. Devices which can retain the keeper rods from allowing the doors to be opened, protect them from the surreptitious introduction of weapons or the theft of goods while in transit. So go figure, we can purchase a portable door locking device for $60, which we can use for years, which protects us from losses or manipulation of cargo in our care, which like brake locks have no residual cost, but a tremendous payback�. why then don�t we all use them? Security is everyone�s job. There is no denying that this is a different world than what we are all use to and our industry has to step up to the plate and defend our country from those who would harm us. We need to demand protection of the nation�s softest target! We need to mandate security on all commercial �over the road� and local delivery trucks, busses, garbage trucks and fire engines. For more information call 941 575 0243 or visit www.airbrakesecurity.com

ARTICLE ON RISK ASSESSMENT

Tue, 12 Aug 2008 17:52:26 -0400

Operational planning for cargo security threats is an important strategically component in operating your business, but it is especially true in transportation. For the owner operator who may be unfamiliar with this analytical process, I will try and enumerate each category of risk consideration from both large and small business prospectives; however the planning strategy and components are exactly the same dynamics for either. Planning can be the difference between profit and loss when it comes to funding security countermeasures regardless of the size of your operation. Since countermeasures come in all shapes and sizes, it is critical to understand their type and inherent nature of mitigating loss while understanding how any why each component integrates into a functional strategy. Operational in-transit risk, as it relates to carriers in all modes of transit, is a concept that needs to be refined in order to craft a plan responsive to your unique reality, economic and business conditions. The components of such a decision include the use of protocol based and physical security technology designed to reduce both theft and damage and collaterally reduce issues of tampering and terrorism. Not all phases of planning involve costs; in fact many of the more critical decision do not have any real costs at all. Timely and appropriate procedural and process protocols can enhance security and safety as well as anything. By creating awareness of issues and by training employees, companies can conquer many challenges that are nearly impossible with technology. Attention to operational risk helps outline these areas of weakness and provide the basis for change. Because the problem is not currently active does not mean that attention to it is not important. By studying analytical data germane to your type and size of business, known future risks or growth based risks can become more apparent. Such planning helps to proactively defray probable losses before they become emergent issues. Proactivity in security is always a challenge to security professionals. Budget constraints and senior management complacency to in-transit losses is usually a stumbling block to security planning. Loss from cargo theft exceed $10 Billion dollars nationally and hundreds of billions internationally. Collateral losses associated with in-transit theft run five times that number. The Inland marine Underwriters and many insurance associations rate the magnitude of business losses by a companies ability to recover from the event or to replace the items lost. Just like it is impossible to �make up lost time in the air� as many airlines contend, so too is it impossible to make up theft or damage based losses. Carriers who self insure cargo, rarely pay claims for employee infidelity and consequently leave clients to find their own financial remedy. To insure for such losses typically requires shippers to provide their own protection. Operational costs to shippers of product replacement, re-transportation, re-insurance, liability, destruction of marketing channels, lost sales opportunity and aggravated clients usually is enough to force change. From the carrier side, the leverage used by shippers to recover losses usually ends in concessions which also erode profitability. What if both the carrier and shipper could find a means to protect their interests while combining their collective resources and intelligence to �plan ahead� to reduce their inherent exposure to these losses? Damage based losses are just an everyday condition of doing business. Damage will happen but when the appropriate equipment is used, the packaging is designed correctly and the handling is done with care, damage can be avoided or reduce to a minimum. Like these obvious procedures reduce damage so to can appropriate handling, routing, equipment, training and technology can reduce theft. Where do you use it and what do you need to do to implement it correctly? First you have to view the problems from 5000 feet. The use of statistical data, which you may already have, will provide many answers. Check your loss and damage reports from 2-3 years back. Find out where the happened, what frequency they occurred and how much did they cost you. Take these data and put them on a map of the area your service, or for a shipper, your worldwide supply chain. Next overlay the routes you travel with the most frequency. Next partition these routes by client and attempt to find correlations between a particular type of load and your loss records for a client. For shippers, chart your routes by carriers and determine the hot spots for loss. Shippers should also use an overlay for each transit mode thereby identifying the more dangerous lanes by transit more. For instance Jakarta by sea through some transfer port then on to New Jersey which then rides the rail which transfer to highway. Before long and by using known data you will see patterns. These patterns for the basis for a risk assessment analysis. If you could move this particular trade lane, route or transit mode to one that is more secure you can reduce your risk of loss. If alternatives are available through your same carriers, a simple request for such a change can reduce your potential loss. If those changes have an increased cost, develop the metric of known loss against the potential up tick in cost to determine if the offset against the potential savings is an effective remedy. Typically the financial decision of potential dollar loss against real and higher shipping costs causes your CFO angst. It is the job of every security professional to stand behind the debate of the reality of risk. Your statistical data will help in this argument. Spend a little to save a lot is the prudent course of action. Trade lanes, commodities, transit modes and yes carriers all adversely affect your bottom line. A carrier who accepts highly vulnerable cargo in known risky areas has the same propensity for a disaster as the shipper who uses a carrier in known dangerous routes. Both side always feel the paid of theft or damage loss. When you examine conditions for disaster, consider both sides of the argument and both prospectives. Certainly carriers and shippers can make better choices if they are informed about risk. It is no wonder that for the past 5 years losses amongst 3pls and forwarders dwarfs losses from warehouses and local ground deliveries. Is this because the expeditor has no control, or is it because his position as a facilitator does not account for risk? Empirically getting freight from point "A" to point "B" seems easy. Choices become skewed by costs and carrier availability hence many of the efficiency and care become lost in their desire to move the cargo. Physically carriers providing these services have little choice in offering remedy because they are tangent to the move and have no nexus to the cargo, shipper or culpability for the loss. The chain of custody for cargo is frequently lost to the convoluted nature of offsite shipping choices and operational controls. How would a dray in New Jersey become aware of the protocol used by the vendor in China? Unless the move is controlled by someone who can inform and train the various handlers, any countermeasure is lost to chance. Reviewing these hand offs and accountability procedures can also reduce shipper and carrier risk by employing the countermeasures already in place by these vendors. In an instance such as this, the cost to avail yourself of the higher level of security is negligible but only able to be used with knowledge and planning. Statistically, controlling theft can add 10% to your bottom line, yet statistically only a micro percentage of funds are allocated to theft control. 80% of al business related losses occur in the supply chain yet less than 5% is ever budgeted (already combined) for this threat and known eventuality. Damage on the other hand, which by far is the largest component of day to day business loss, is a visible percentage of operational budgets. The damage we experience from year to year is almost a given. Even with better packaging and better handling methods, damage continues to be a programmable number. Why then, if we know that fact, do we not look to find areas we can control such as theft? Theft is typically not random yet when and where you are hit remains in question. Charting losses helps refine this data to better plan against it. Other data to consider is your commodity, packaging, shipping route density and frequency. Manufacturing or distribution sites and cyclical operations unfortunately require you to accept certain risks however in many cases future planning can help move resources around to address vulnerabilities. Economic indicators in countries or cities that are frequently used combined with crime rates, corruption in the country of origin or transfer, condition of equipment and training of handlers all provide insights into potential conditions for financial loss. From the assessment of statistical data you begin to develop a cost of avoidance metric which combines these elements into a real number, albeit developed both from real and gut numbers. This avoidance cost will have to account for any increase in technology costs, shipping costs and overall administrative costs, but it will clearly show the cost benefit of deterrence vs. you potential chance for perpetual loss. Theft losses which never happen cannot be minimized. Avoidance protocols can and will prevent the big hit which will always exceed the costs of deterring the loss in the first place. This rational will also conversely identify if your costs of avoidance exceed their tangible benefit. Yes, you will quickly see that at a certain level your preventative cost exceeds you potential loss. This over spending is an acceptable situation in pharmaceutical companies or in companies where replacement is impossible such as in natural or grown foods or in situations where national defense is at risk. From a smaller operators prospective, any cost of avoidance which would keep him in business is a constant real consideration. If your truck is out of service, you are out of business, where a larger fleet is able to recover; your ability to have a plan B is non existent. For shippers where JIT cargo is their normal operational choice, avoidance is also a more prudent choice.

Continuity Planning

Tue, 12 Aug 2008 17:51:10 -0400

Continuity Planning By Erik Hoffer President, CGM-AST 800 899 2246 www.tamper.com It is 9/10, the day before our Nation�s worst nightmare. The world is at peace, businesses are running smoothly and all is seemingly well. On 9/11 and beyond, our world and our collective reality changed forever. Were you ready? Are you prepared to pick up the pieces of your business and continue on in the face of a disaster? If you are a carrier, can you exist after your company�s assets are reduced to dust, or if the nation�s highways are closed, or if air transportation is halted or if our ports come to a standstill? Moreover, can you stay viable if your main clients are out of business? If the disaster was next door, would you be prepared to offer aid? If the disaster was over seas and cut off your supply chain, could you carry on? If you are an owner operator, where your very livelihood rests on your truck and you access to our Nation�s highways is terminated, what would you do? These are tough questions that need answers and action. The paradigm of business continuity planning is a reality for all companies large and small. No business owner or executive manager can challenge the need for strategic disaster planning as part of their future strategic focus. To loose the utility of 1 truck to an owner operator, or to loose the ability to drive your fleet of trucks has the same overall negative impact. If you cannot import, or you cannot manufacture, or you cannot ship or receive goods, how will you sustain yourself? What happens to your employees? Who is in charge? There are no more pre 9/11 excuses, because the threat to our economic well being has become a both a credible threat and a harsh reality and those yet unprepared, it will be devastated. Businesses impacted by disasters can either fold or rebound, solely based on their pre-existing executive business planning decisions. By having sufficient economic remedy in place along with a plan of action you are more apt to recover in time. Even governments, both National and local, require this type of recuperative disaster planning. In the recent London terrorist attacks, buses and trains were operational in 24 hours. Without planning such a recovery would be improbable. Disaster planning at that level must also include a skew toward journalistic spin and an ability on the part of those in charge to instill immediate confidence. So too in the World Trade tragedy, then Mayor Giuliani was able to both calm and direct the recovery. A disaster can be a hurricane, or a flood or fire, just as soon as it can be a terrorist bombing or a biological attack. The main consideration in any catastrophic event is your ability to return your operation to normal practices as soon as possible and with the least confusion. To be able to restore order out of chaos and to implement a course of action defined by the event is a distinct challenge. Which are you? The company that has a plan or one that is in denial of either the plan itself or the need for a plan? Sure, if you were in Los Angeles, 3000 miles from ground zero impact, you couldn�t truly appreciate the physical trauma of a 9/11 type disaster, but yet the economic and psychological fallout was just as real over the entire free world. In corporate speak, COOP or Continuity of Operations Planning, is all the buzz. Every department in the Federal Government has an action plan and every business must also seek to plan for life�s �what if�s�. What goes into a disaster recovery plan? Who writes it? Who funds it and who will be in charge of implementing it? There are no immediately apparent answers nor a �what to do� book, but when a disaster or catastrophic event adversely affects your businesses ability to operate, you damn will better have one. Typically the person most apt to author such a plan has to be the person in charge. As an executive decision, the plan must take into account the functional aspects of all concerned departments and their individual ability to orchestrate the actions required for recovery with or without the �key man�. A plan must define responsibility as well as orchestrate definitive actions. By combining input from all quarters of a business, corporate management can craft plans that would effectively divert funds, acquire resources and deploy assets and personnel where they were needed for a recovery effort. If such a plan were to come from individual business components it would probably be skewed to that particular area and not sufficiently dynamic to address the entire entities needs. Plans must be cohesive and individually functionally sound for the business you are in, for your size and for your geographic area, not to mention the variety of threats faced by different businesses in different locations. Creating a plan and periodically testing its effectiveness, in real world exercises, is costly yet essential for everyone. Testing defines areas of weakness and helps refine the actions needed. No one knows what will happen in an event hence board room type drafted plans often fail to meet reality. Creation of definitive documents for each department after testing and refining is essential. No plan works the first time. Just remember the 6th grade fire drills when your teachers freaked out with 200 screaming kids to control. Try that with 2000 adults in a real fire! Operational testing in actual plants or business sites, during the work day, is the only way people can gain a refined understanding of their individual role. By being able to oversee these tests, managers can quickly see the inherent weakness of a plan or just how the participants function under stress. This visual analysis enables you create alternatives and refinements that will better support your goals. Make sure, however that everyone knows where they fit in the plan and that everyone�s focus is on the overall ability for a business to recover. Individual empowerment is the single most significant psychological aspect of plan development. By insuring that your personnel know their individual role in the recovery action can insure buy-in from all participants. By knowing that their unique role contributes to the plans effectiveness is also essential to the plans success. There is nothing worse than helplessness and hopelessness when dealing with a crisis. Planning certainly helps to avoid the obvious chaos which can result in the event of a catastrophe since actions and reactions are predetermined, practiced and orchestrated. Perpetual periodic testing helps plans stay refined based on current and changing conditions; testing also enables plans to be updated to meet the current events and physical and manpower needs of a business, which can change quickly. COOP planning needs to account for all possible changes to your supply chain which affect your ability to manufacture or delivery goods as well as how such changes affect your ability to recover from the event. Planning needs to not only address your specific vision for recovery but also to account for insurable instances where financial recovery or remedy is possible. Operational recovery planning needs to address the creation of alternative operating facilities (where possible) for manufacturers, replacement of key personnel and assets and restoration of communications and financial stability. Planning needs to define what a disaster is by type and kind and what specific components of a disaster plan need to be activated and when and by whom. Defining disasters by category helps reduce their negative impact on a business because the issue, upon its occurrence, is more readily understood and the mitigating action is more immediate and appropriate. Where no planning has taken place you are more apt to get knee jerk solutions that may be equally as detrimental as the event itself. Planning needs to create action lists and define those locally responsible for implementing recovery procedures, as well as creating first responders for certain events. Planning also allows for integration and knowledge of available governmental resources and remedies, without the need for on the spot research. If you know who to call and when, you will probably be first in line to get the service you need. There are times when a disaster can hit you as a secondary fall out condition. Instances such as your main supply port being closed by an event halfway around the world, which disrupts your businesses ability to conduct normal operations. The processes needed for recovery differ radically from the processes needed in an on site fire or explosion. The primary goals of operational planning need to be protect life, physical assets, business communications and your brand from long term harm. Events such as product tampering, as in the famous �finger in the food case�, deal with recovery based on short and long term journalistic spin. Issues such as this are based on securing your brand equity as the remedy rather that situations such as an on-site shooting deal which deal with damage control in the here and now. Protecting associates on your site or your brand both qualify as �operational considerations� in development action planning. Long term sensitivity and the psychological impact of a crisis on your personnel is always a concern. People respond to their own reality and based on the event may not be able to serve the interests of the business in that moment. Post traumatic stress disorder is truly a reality to be reckoned with. Because people need time to mentally heal, planning for operational continuity needs to account for some redundancy in training and personnel deployment after an incident. Your manager�s ability to unify the work force under conditions of extreme stress can be the difference between a businesses ability to move ahead or become stalled in their effort to recover. Recovery cannot be form fitted to a specific time frame; it needs to be fashioned to the events and conditions. From soldiers to workers, stress can cause both short and long term problems in being able to effectively function. This post traumatic stress disorder equates to crating its own secondary internal chaos which then combines with the original outside stimulus to further add to the problem. A weapon of mass effect uses this principle to work long after the event is nullified. In some terrorist cases, when their simple goal is disruption of the status quo, disruptive events can be more subtle than violent but yet have the end result. Death and physical destruction rank as the most catastrophic of events however, non-events such as �threats� can easily trigger an economic catastrophe of equal magnitude. A WMD, a weapon of mass destruction, such as biological attack or bomb, can be less devastating than a WME, weapon of mass effect, such as shutting down a port by a bomb threat. The more sophisticated and focused terrorists are, the more likely they are to employ both tactics. The more refined your business continuity plan is, the better able you are to deal with both. A company�s ability to deploy COOP plans needs to account for as many conditions as possible without going overboard. The most innocuous thing can be your greatest nightmare. Loose procedures that create vulnerability should be examined. The Courier package delivered and signed for without regard to its origin, physical anomalies or physical scrutiny can create a vulnerability to your business. Anyone can easily send you a bomb or biologic (deadly or not) unless you check it at some level. Paranoia should be a component part of anyone in the security business, and certain paranoia is healthy. Contingency plans should be able to be superseded by prudent operational planning for day to day activities. Simple protocols can insure the security of a facility as well as anything can. The simple checking of a drivers ID, taking his fingerprint for your files, requesting a picture and a letter of authorization from a company empowers your gate guards to insure who enters your yard is authorized to do so. Looking at each package as it arrives for any sign of trouble. Examining visitor credentials and advanced knowledge of people who intent to be on sensitive sites is also helpful in insuring that everyone is accounted for if a plant wide emergency exit were necessary. Challenging a stranger in your halls is simple and effective. Training for these procedures and their consistent use can prevent major disasters. Developing a disaster plan needs to address replacing blind trust with some level of scrutiny and skepticism. Employees must be just that much more careful in performing their tasks now than ever before. Their personal security and the security of their company may just depend on it! In today�s world we need to be more vigilant in inspecting inbound cargo, securing work stations and computers, securing the intellectual property in their care and even in allowing people to walk their grounds unabated. Planning should be both proactive and not exclusively reactive. It is certainly easier to avoid the problem than to deal with its aftermath and effect. Just as in cargo security, a little proactive planning goes a long way to insure that your business runs effectively.

TRYING TO SEPARATE FACT FROM SMOKE IN CARGO SECURITY

Tue, 12 Aug 2008 17:49:58 -0400

The cargo security initiative is in the development and concept stages. Smoke and mirrors skew the discussions because recommendations presented by many of the experts asked to participate lack the core expertise required to recommend remedy against unforeseen threats. Many of these experts and officials lack a practical understanding of the physics behind seal security and cargo terrorism. Intimate knowledge of intelligence on threat issues is not sufficient background to recommend remedy. Specific knowledge of the physical attributes of security technology is not a substitute for understanding the threat. People who are finally asked to decide on the correct system and course of action may not be intimate with the nexus between science and viable mechanical remedy. Many of those in the know in our Government and those consultants to the government present options based on perceptions rather than facts which can cost everyone dearly. Any approved plan will ultimately attempt to establish a level of container sealing and monitoring integrity for the entire world supply chain. The system should ideally be able to enhance homeland security, by reducing the threat of attack through cargo entering or leaving any port. By developing a workable intelligence security program combined with viable security devices, we should be able to identify suspect cargo before it can be placed on a ship heading to the United States. DHS and Customs and the Department of Border Protection, who seems to be spearheading the project which includes, the plan to cover procedural security for stuffing and shipping containers, physical security for containers in transit, access to ports and cargo yards both here and abroad, personnel integrity checks for cargo handlers, training of personnel on terrorists threats, awareness of the types of threat, secure manifest procedures and conveyance security dealing with the vessels, drays and ports handling, storing and moving cargo. This is a broad-based plan, which requires a considerable amount of technology and refinement before a suitable solution can be found. Implementation must include those physical security products used to achieve containment and control of cargo. Such technologies must be suitable to the real world of container cargo shipping; cost effective for both ports and shippers and able to be readily implemented world wide without development time. Training and refinement in a security plan differs from research and development when it comes to the urgency of this need. Systems that work now are the order of the day. Implementation of a system that requires a tremendous expenditure in infrastructure will limit approved ports, which will severely impact world trade. Such a system is both detrimental and prejudicial to shippers and ports who cannot come up to speed and is the antithesis of free and open trade. People whose jobs it is to secure cargo and whose goals it is to have a successful cargo security initiative are not the same people. Those who pay the bills to ship, carry, handle, receive or load cargo are truly ambivalent about the implementation of such a system as they see such implementation as an added cost, which serves to reduce their profitability, creates delays in cargo flow and increases their workload. Not that individually they are not concerned about Homeland security, but having 30+ years in speaking with these companies gives me that accurately skewed viewpoint. Shippers have always faced the threat of loss through theft. Shippers who know the score on cargo theft in the United States, which exceeds 25 Billion dollars annually, most have inherently not used the simplest tools available to secure cargo or containers from theft or tampering, primarily because of the added costs, it is that plain and simple. The threat has never been higher for theft, tampering, smuggling or terrorism, yet the reluctance of most shippers remains consistently steadfast when it comes to the use of security tools at their expense. Even when confronted by a loss, most shippers complain vehemently about spending much more than a $1 on a bolt seal securing a container worth millions. Now that the threat has become more public and it has grown to include terrorism on the list of loss conditions, have shippers begun to recognize their participation in the cure process. Tampering, smuggling (piggybacking) contraband into legitimate cargo and the use of your container to ship bombs and people around the world is suddenly real. Those who decide how much to spend for protection need to get on board with these initiatives and work as a team with our government to accomplish the mission at hand. With that �penny wise dollar foolish� base mindset, let�s look back at the Customs initiative question and how that relates to the available technologies and viable solutions. From the port prospective: In order for a port to offer any level of security containment they must open and inspect cargo before sealing it. Cargo in a container is just that, inside a steel box, not visible nor accountable and highly vulnerable. A total trust relationship must exist between the shipper, dray company, port and sea carrier, who in turn has an implied trust to the receiving port, dray carrier and ultimately to the recipient. If that viable at any level, there is a bridge I would like to sell to you! What must happen in any system requiring container security is that the person loading the container must be the one to apply the security control. The control element must preclude surreptitious opening en route and it must offer a formidable barrier to those trying to open it for any purpose. The most common element for securing a container is a bolt seal placed through the handle hasp. That product, regardless of brand, manufacturer, quality or features, has only ever been good as an audit tool and certainly never has offered or claimed to offer security. Seals are so easily circumvented that their utility as a security device is ridiculous. When dealing with a threat such as terrorism, expecting anything more from a seal would be ludicrous. Seals do a disservice to users who have a misconception of their value, besides being easy to replicate, commonly loose application and removal techniques and auditing errors, make them even more suspect. To the uneducated eye they represent strength and security which is dangerous. As a component therefore of an initiative dedicated to security containment they fall way short. Procedural security is next: When containers are loaded in facilities all over the world, the last thing on the �to do� list is security. For a container of 40,000 pounds on pallets or 500 floor loaded cartons, shippers want to get it packed, close the doors and get it on the road. Who can verify the contents? Here the vulnerability is by far the greatest. A terrorist can easily be employed and replace jackets with grenades in just one box. An initiative such as this cannot address off site issues for obvious reasons. A known shipper program must be implement such that when cargo is taken from a pre-certified shipper, we have done our best to transfer the containment and control issue to them and hope that they regard homeland security as much as we do. Shippers need to check out their personnel, verify contents before sealing and do what is needed and reasonable to assure the container is free of problems when it is packed and the doors are closed. With this in mind, once the container is closed, how does that shipper insure, (if he uses a bolt seal) that the doors remain closed are not re-opened and contaminated prior to the container reaching the port? This can only be accomplished by the use of a locking bar type system that precludes the doors from being opened. Only after appropriate security protocols are applied by the shipper at the time of sealing can anyone hope to achieve containment and control of the cargo? Security features and techniques not applied at the shipper level are always suspect. Once you have gone through the trouble to guaranty the integrity of the contents it is truly ridiculous to stop short of securing it when it leaves your control. The next area is the need for real time information on containers and their contents in a paperless environment. It is obvious to anyone that has ever seen a port or a container yard or a ship is that the environment that these containers move and are stored in, is hostile. Salt, cold, heat, water, shock, rough handling, stacking and truck mounting are hard on steel much less electronics. Most technologies that have been tried in the past to transmit information from containers fail because they either break down in salt, rust, become damaged and unusable and or they are broken off during transit. To think that a delicate RFID tag could withstand this environment is questionable. To then place that sensitive and expensive element into a port security system would be asking for trouble. Who will pay for it? Can it be recovered? Who is responsible to monitor it and where? How will we affix it to the containers? Can it stand up? What will it take to read it? Products such as active RFID tags have been touted as the coming technology for almost 3 years but they fall way short of viable. They offer no security at any level. They barely have been used in any industry because they cannot be read around metal, they cross talk, they break, the batteries wear out, they cannot take abuse, they are expensive and this just touches on some of their short comings. They are great in a lab environment but not at a port. RFID tags are expensive to use, to own, to verify, to get back and to audit. To analyze the RFID industry as it relates to security you need to understand very basic electronics. Radio signals are blocked by metal such as containers are made of. Hundreds of containers in a yard facing different directions require many expensive antennas and a costly system. Each system of each manufacture may be different so which will people use? Electronic readers needed to interrogate active tags are typically antenna based and must be deployed throughout a container yard. This infrastructure requirement would be extremely costly and provide little else than a scan but with these serious shortcomings. RFID tags can be removed and replaced, they can be broken off and therefore not read at all, making that container invisible without a physical check, which makes the need for RFID redundant if you have to go out and find it. The tags need to be applied at origin. Can you see shippers in Jakarta holding shipment because they need tags! RFID tags have no relationship to the lock mechanism hence they provide no security at any level just location and data if they were to work. Tags are expensive and must be funded by shippers who will get no tangible benefit from them and no possibility of recovery and re-use, hence no cooperation. The tags must be able to be read at every port and by every carrier in order to render any level of reliable real time information. The infrastructure of many foreign ports has not reached the computer level much less RFID readers. The information is only as good as the software and interfacing software between many companies and operating systems is a joke. Rights of authorship on the choice of software and hardware out of all of the existing tag manufacturers would begin WW#3 in the industry. The requirements of a port to implement a new infrastructure to accept all possible tags and integrate them to one common LAN to read them would be a 5-year project at best. To accept RFID information implies that the tags would solve some portion of the problem when in fact they would create a logistic nightmare. Without physical interaction with the container and its lock (lock bar) you can never be certain that the box was never opened only that the tag is somewhere in your yard hopefully still attached to the original container! Security can only be achieved when it begins at the beginning, offers the appropriate protection based on the threat and has audit characteristic and physical checks throughout the logistic cycle. The next few elements of the security initiative are systems training, threat awareness, paperless manifest procedures and personnel screening. These are the areas make the system work. If they are done in a hands off environment without interaction of people and the containers, the information cannot never be counted on as reliable. Terrorists are anything but dumb. They will easily circumvent security that is not going to be monitored by a person. Albeit people can be intimidated and corrupt where electronics is unshakable, the lack of interaction with a person makes any security system suspect. An RFID tag for instance in concert with a container lock bar can certainly provide enhancements for information sake but if no one is looking at the bar and relying on the tag for an integrity check it falls short of a the intended security goal. A sound security protocol needs to recognize basic principles of chain of custody and inspection practices. Repeated checks to certain predetermined specs make a security system work. Training that involves a person at a computer interpreting data will offer no such protection to the introduction of a bomb into a container. Money being allocated to �yet developed� technology is money poorly spent. It goes without saying that too much people interaction with data is a bad choice. People make mistakes. A dock worker or security guard standing outside in the heat or cold and trying to update data by hand is a major cause of errors. Such transcription errors can result in containers being delayed, discarded, opened and examined or mis-shipped; all of which are bad news for shippers, carriers and receivers. What is needed is a system that has known reliability for the effective storage and unlinking of data. There are many companies that make suitable machines to audit data and link it by an existing LAN to a central computer. There are NO infrastructure requirements with this type of system and no need to develop software or to spend millions to make it work. There are systems that can be implemented in days not years and ones that can legitimately compete with one another rather than choosing one RFID supplier to cover the globe. Such a system is a passive memory button. The Navy has 500,000 of these in use. They work with readers from Compaq, Symbol, HP, LXE and many others. The memory button can not only correlate and transfer information through these �off the shelf� readers but do it reliably and accurately. They can be read anywhere without a need for a LAN and used simply in a laptop and emailed to the next stop for the box. These systems can be used, as they are by the military, on containers and on seals and lock bars. The systems are inexpensive, 1/10th the cost of an RFID and they meet MIL 801E, the most sever spec for outside use. They can act as a major security component in that they tie the container itself to the seal and the seal to the lock bar and at the same time they carry every needed document in a truly paperless environment. This device can be checked by a simple 1-second touch at the same time as the lock bar is physically checked for integrity. You get instant data in real time, no risk of data transcription errors and a physical security check all within a few seconds time. By having a forced template for interaction with the container, sea containers will move faster through ports and on ships. This type of system can be used from Zambia to Camden because everyone can get up and running in weeks not years. The last and final component is the container itself. It is my recommendation that each shipper and carrier be required to use a self adhesive door seal to show that the doors and hinges have not been manipulated and that numbered seal be recorded into the memory button to correlate that last security component into the system. When this is done at the shipper level, the dray company who may not have these readers can also assure himself, reasonably, that the door was closed by the shipper and that he is not moving a bomb to the port. Literally millions of these have been used throughout the world. Their cost is minimal yet their deterrent and inspection value far outweighs a bolt seal when directly compared. No system is perfect and no one can seem to agree on what to do. The only reasonable approach is the look for a secure quick fix that offers enough security now when we need it rather than have to allocate finds to some �pie in the sky� venture that would take years to set up and debug. What we need in homeland security is a working plan that can be bought into by everyone.