BOISE, Idaho — In its “Protect My Business” section on its website, Truckstop recently published an article on “the other F-word in trucking”: Fraud.
Truckstop, since it began tracking fraudulent activities in the industry in 2003, has been on a mission to help the transportation industry protect itself from the horrors of the online world of fraudulent activities, company officials say.
Throughout its 20 years of tracking said activities and collecting data, Truckstop has reported an intensified increase in fraudulent activities in 2023.
Truckstop’s Chief Relationship Officer, Brent Hutto, stated, “In Q4 of 2022, the data showed a 400% increase in fraud complaints in the industry. That’s the highest increase of fraud complaints we’ve seen in trucking since 2008.”
Industry data backs Hutto’s statement, as Verisk Analytics’ CargoNet reported that 2022 had a 20% increase in cargo theft and a loss value of $223 million.
“There are a tremendous amount of bad actors taking advantage of an industry that’s holistically just trying to do its best for the American public to get freight delivered,” Hutto said.
In order to continue helping create the most successful businesses for carriers, brokers and shippers, a webinar was compiled and created with the common trends in the market and strategies to prevent fraud scams leading to businesses losing a devastating amount of capital. You can watch the video by clicking here.
The first red flag to look out for is the contact information you are receiving messages from.
The scammers are bad actors who will often change a character or two in an email address or other identifying information so that it looks legitimate at first glance.
- Be sure to inspect email addresses for things like an “O” switched out for a “0” or a suspicious domain spelling. They may also make subtle changes in punctuation like “email.truckstop.com” vs “email_truckstop.com.”
- Virtual phone numbers — like a Google phone number with no physical address attached to it—also have a high correlation with freight fraud. Call the numbers to verify it is, in fact, the right carrier.
- Verify the physical address being used is an actual location, not a vacant lot. Multiple carriers using the same address can also be an indicator that scammers are working together to commit freight fraud.
In the earlier years of trucking, specifying authority tenure when someone was looking for carriers was a way that was a great way to find experienced and reliable contacts.
However, now, having an authority of 90 days, 120 days or even sometimes a whole year may no longer guarantee the legitimacy of a carrier.
Getting a verification of the authority of a carrier with trusted technology can help lessen this risk. Checking the Taxpayer Identification Numbers (TIN) against all W9 information to catch potential fraudsters. If a carrier has 20 trucks and no inspection history, you should consider that a major red flag, as looking at a potential carrier’s inspection history could provide clues.
Being aware of the current and common targeted cargo trends is extremely important. Scammers are currently targeting items that can be sold quickly at a high price point, like household goods, electronics, and solar panels. The target items in cargo change frequently, so thieves and scammers can stay under the radar. Working to stay up-to-date and communicate with your professional network to be aware of market shifts.
Ways to establish, enforce and monitor due diligence
Have your business issue a written standard operating procedure (SOP) and enforce it. Enforcing these standards is what will make a big difference. Let everyone involved in the process know your intent for carrier vetting, and then make sure frontline teams are actually doing the work to put it into practice to keep your business safe.
“When comparing technology vs. an employee dedicated to carrier vetting, nine times out of ten, the ROI is in favor of the technology,” Hutto said.. “It isn’t just ‘nice to have’ anymore. It’s a requirement to be successful in this business now.”
Tips to prevent fraud include:
Require an Invitation to Register
When onboarding carriers, require an invitation to register on your website. This can be an invaluable tool in weeding out scammers.
Automate Your Business Rules
Filter all of your preferences automatically to immediately de-certify those who don’t meet your qualifications. This automation eliminates the risk of human error and helps frontline employees working with carriers follow your SOP.
Incorporate Immediate Notifications
Because this industry moves quickly, your team needs immediate notifications of any changes in safety authorizations. You could be talking to a carrier with valid insurance today, and tomorrow their insurance goes invalid. Technology lets you access continuous carrier monitoring and alert your team to any changes in real time.
Use TMS Integrations
Work with technology that integrates directly into your existing TMS to make compliance changes immediately and easily accessible to your team. Use trusted technology to keep your business safe and running smoothly.
Leverage the Network Effect
Communicating with your professional network and government officials is a powerful defense weapon. Talking with other brokers, sharing scam trends, locations, and recovery efforts, and cooperating with agencies like the FBI can better safeguard your business and the transportation industry.
The more informed you are about current scams and how to protect your business, the better. Here are some ways to help your team, and your carriers, remain compliant at all times. Keep your private information secure across your entire business. Using these steps could provide extra security for businesses.
- Do not reuse passwords. Create unique passwords for each account and be sure and change your passwords frequently.
- Avoid commonly used, easy-to-guess passwords. Instead, use short phrases or sentences for your passwords. They are longer and tougher to hack but easier for users to remember.
- Turn on multi-factor authentication (MFA) where available. The main factors of MFA are something you know, something you have, and something you are. MFA makes stealing your information much harder.
Educate carriers so they will know what to watch for when it comes to the bad actors who impersonate carriers as well as brokers and how both of you can help protect each other. Implementing training on phishing and smashing scams is encouraged, as some scammers would contact you by email and text. Phishing is done via email, while smishing is done over text messages.
The Trucker News Staff produces engaging content for not only TheTrucker.com, but also The Trucker Newspaper, which has been serving the trucking industry for more than 30 years. With a focus on drivers, the Trucker News Staff aims to provide relevant, objective content pertaining to the trucking segment of the transportation industry. The Trucker News Staff is based in Little Rock, Arkansas.