Using Information To Fight Equipment Thieves—Part 3
December 2002
In his continuing series on heavy equipment
theft, David Shillingford considers ways in which information can be used to
fight crime.
by David J. Shillingford
National Equipment
Register, Inc.
This is the third of four articles that deal with the growing problem of
heavy equipment theft, the costs that result for insurers and owners of this
equipment, and what can be done by owners and risk managers to reduce the costs
associated with equipment theft. Part 1 of this series discussed the size and nature of the problem and how to align
theft prevention with business goals. Part 2 described simple physical measures that can be taken to prevent theft.
This article considers ways in which information can be used to fight equipment
crime. The final article will discuss how new technologies are being employed
to combat equipment theft.
It has been said that, "The pen is mightier than the sword," but can information
really deter equipment thieves in the same way as a chain-link fence? To understand
the answer to this, it is important to first understand why thieves increasingly
see equipment as a soft target, and how information availability—or the lack
of it—is such a large part of the problem.
Thieves steal equipment because it is valuable and because they think the
risk of being caught when moving, storing, or selling equipment is low. Low
recovery, arrest, and conviction statistics would bear out the thieves’ confidence.
Why are the chances so low, and how do these relate to information availability?
Ownership Data
The first challenge for an officer investigating suspicious equipment is
to ascertain ownership. If an officer stops a car in suspicious circumstances,
even if the theft has not yet been reported, the true owner of the vehicle can
quickly be determined. This cannot be done for heavy equipment, as there is
no mandated national registration system for off-road equipment.
Theft Discovery
The problem of locating the true owner of equipment is compounded by the
delay from the time of the theft to the discovery of the theft. A car theft
will be discovered hours, if not minutes, after the crime. An equipment theft
on a Friday night might not be discovered until Monday morning.
Equipment owners with larger fleets, multisite operations, or some rented
equipment may not discover the theft for days, weeks or, in some cases, months.
This gives the thief a "window" of opportunity when any investigation by law
enforcement will not find a theft report. This is a particular problem because
suspicious activity—such as moving equipment at a strange time of day or on
ill-suited transport—is most likely to occur during this "window."
Loss Reporting
The next problem occurs when the theft is discovered. There are a number
of hurdles to a "successful" equipment loss report that do not exist for autos.
Without registration or title documents, a theft victim may not have a record
of the Product Identification Number (PIN) or serial number, which is the key
information needed to recover the equipment. If the owner has a PIN, it may
be a shortened version such as that on a warranty card or bill of sale that
may not be a unique identifier. As there is no standard format for the numbering
of heavy equipment,1 data entry error is
common, and there may be confusion whether to file the loss as an ‘article’
or a ‘vehicle’ in national police and insurance computers.
The internationally standardized 17-character auto Vehicle Identification
Number (VIN) has an algorithm that checks the validity of the VIN; however,
this cannot be developed for nonstandard PINs—indeed it is difficult for the
officer or adjuster to even confirm that the equipment ever existed. Even when
an accurate PIN is reported, there is still the risk that the owner is reporting
the wrong item because, unlike most auto owners, equipment owners may have a
number of similar machines. Whatever the reason, an incorrect PIN renders the
loss report almost useless.
Difficulty of Investigation
To identify a piece of equipment requires a level of expertise that increases
with certain types of equipment and the degree of sophistication of the thief.
Even equipment that has not been "disguised" may have the PIN in many different
places, some harder to find than others, with many other identification numbers
of components and attachments to confuse the issue.
Officers cannot be expected to have this level of expertise, especially given
the low priority of this victimless crime. Officers know from experience that
equipment investigations are time-consuming and often lead to nothing but frustration.
Therefore, they are understandably reluctant to get involved in such investigations.
By contrast, the placement of VINs on autos is standard, and the level of training
in auto theft investigations is high and well-funded. It should also be noted
that physical and, to some degree, legal access to autos is generally easier
than for equipment on worksites.
Used-Equipment Market
The lack of due diligence in the used-equipment market is in stark contrast
to that for autos. When buying a car, title documents are exchanged, and services
such as Carfax® offer full vehicle histories. Until 2002, nothing like this
existed in the used-equipment market.
This is a key consideration for a thief in assessing the risk of getting
caught. If stolen equipment can be sold with impunity, not only does this reduce
the risk of detection but it also allows stolen equipment to be sold at, or
close to, market price. So, it can be seen that thieves rely on low physical
security and the lack of availability of information for law enforcement and
those buying equipment.
The solution to equipment theft must therefore be built around improving
physical security (see Part 2) and improving
the availability of information.
Data Solutions
Data solutions should be designed to provide accurate information on ownership,
loss reports, and equipment identification to law enforcement investigating
equipment theft 24 hours a day. The solution should also allow those buying
used equipment to check the status of equipment for sale.
How can this be done and how can equipment owners be a part of it in a way
that supports the bottom line? The solutions break down into two areas: what
to do before a theft and what to do if you suffer a theft.
Pre-Theft
The least that an equipment owner should do is to keep an up-to-date inventory
that includes full PIN listings so an accurate theft report can be filed if
equipment is discovered to be missing. It is too late to do this once the theft
has occurred. Even better is to record key component numbers, such as those
on the chassis or engine, as thieves often remove or switch PIN plates.
Data as Deterrence
To use this information proactively, equipment details can be registered
online with the National
Equipment Register [NER]. NER provides law enforcement with a 24-hour-a-day
hotline to support equipment investigations whereby NER can identify the owner
of registered equipment found in suspicious circumstances, even before it is
discovered to be missing.
Registered equipment will display a decal, such as that shown below, warning
a potential thief that the item is registered and that the chances of an item’s
detection while being moved, stored, or sold are greatly increased.
Post-Theft
Ensure that a police report was filed and, if applicable, a report is sent
to your insurer. Due to some of the challenges listed above, it may be difficult
to ensure that the correct PIN was recorded in the right part of a national
police or insurance computer, so an important backup is needed, such as registering
the loss with NER. The key component of this loss report is a correct Product
Identification Number (PIN).
Without an accurate PIN on the right databases, the equipment is unlikely
to ever be recovered. When you record and report your PINs, note the importance
of the prefix—the number on your warranty card or bill of sale may not contain
the prefix. Note also that every manufacturer has a different PIN format which
will have changed over the years and varies from product to product is some
cases.
Also report other attachment or component numbers (such as engine or chassis
numbers) wherever possible as these can be cross-referenced against the PIN
and may be vital in a subsequent investigation, particularly where a thief has
removed or switched the PIN plate.
Buying Used Equipment
Due diligence is important at both end of the process. It is not only important
to report a loss accurately, but also when you buy used equipment certain checks
should be carried out to avoid the liability associated with handling or selling
stolen goods. The more equipment buyers do this, the harder it will be for thieves
to sell stolen equipment, which will deter theft.
The obvious red flag when looking at equipment is where the PIN plate is
missing. If it is, this may be cause for the equipment to be seized in some
states. In any case, this should be cause for much closer inspection and for
checking the equipment with police or other registry.
Conclusion
Much of the brazen confidence with which equipment thieves continue to operate
is based on knowing how little information is available to officers investigating
equipment theft. Much of the solution relies on equipment owners carrying out
simple and cost-effective measures such as recording inventories correctly and
ensuring that this information is quickly passed to the relevant parties if
a theft does occur. The question then is: Does the thief want your equipment
more than you do?
1A standard format has been agreed for
earthmoving equipment but will take many years to implement.
Opinions expressed in Expert Commentary articles are those of the author and are
not necessarily held by the author’s employer or IRMI. This article does not purport
to provide legal, accounting, or other professional advice or opinion. If such advice
is needed, consult with your attorney, accountant, or other qualified adviser.