by Kent Perkins, P.I.
Uniformed guards posted on the receiving and shipping docks of many companies provide security for assets and personnel. That’’s a good thing, because cargo theft costs American companies about $30 billion a year, according to Agent Kevin L. Perkins, Assistant Director of the Federal Bureau of Investigation’s Criminal Investigation Division, when speaking recently at the National Cargo Theft Summit in Washington.
Some companies hire their own in-house guards, while others choose contractors. First, let’s examine the pros and cons of having your own in-house Security Officers:
- They can be less expensive than contracted guards, and
- Employers can conduct their own interviews and background checks before hiring them.
- They can be much more expensive to terminate,
- You have less control as to the type of personalities filling the positions,
- They may be more likely to establish “too familiar” relationships with fellow associates, and
- They may be eligible for paid time off, overtime and other benefits not offered contract guards
Often, after weighing all the variables, it’s deemed more economically viable to hire contracted guard services. When doing so, employers should insist on extensive background checks and verification of prior employment; many guard services are lax in these areas, only requiring the minimum background checks mandated by law. Also, Security Officers should receive specialized training in CPR, threat analysis, recognition of drug and alcohol abuse, sexual harassment recognition and prevention, and should be prepared to not only document but to actually intervene if anyone on the company premises threatens violence. Most guard services forbid their Officers to intervene in violent situations because of potential liability.
Your contract with the guard service, if you choose to go that route, should specifically state they will take all reasonable measures to protect your personnel from threats of violence, including physical intervention, if necessary to protect the safety of personnel. Before contracting with such a service, it would be very wise to have your own labor and employment counsel review the paperwork.
For some reason, most people tend to assume Security Guards to be honest, drug-free and sober, and attentive to the tasks to which they’re assigned. There’s something about that uniform and badge that conveys confidence. From our own unique perspective and experience, however, as investigators serving employers for the past several decades, we know better. The truth is, many uniformed Security Officers are good, responsible, honest men and women; some are not.
It’s a rare “internal theft ring” case that doesn’t involve complicity of the Security Guard staff, at least to some degree. A large percentage of cargo theft begins on the docks of warehouses where guards are posted, and when we’ve interacted with them through undercover investigations, we’ve found them to be no less corrupt than any other segment of the warehouse work force.
We’ve conducted scores of investigations actually using Security Officers as undercover personnel. Most thieves hardly stop to consider a company would put a “plant” on the job working as an undercover investigator in the form of a person hired to maintain security, wearing a badge and uniform. It’s amazing how quickly our undercover security people are approached by thieves and drug dealers.
Very soon after deployment, most new Security Officers are “tested” by the corrupt segment of the work force to see where they stand on these issues. If there is already a theft ring underway in a shipping and receiving department, the perpetrators waste very little time in attempting to make a willing partner of the “new guy” in charge of checking loads of merchandise against shipping documents, for instance.
In one of our investigations, we placed a Security Officer at the shipping dock of a large dairy. We discovered there was a very lucrative business underway among the Shipping Foreman, his assistant manager, two additional employees operating fork lifts, the Security Officer [whom we replaced with our own undercover operative] and several route drivers.
The client company was experiencing large inventory losses month after month, and couldn’t figure out how pallet loads of dairy products could simply disappear. Expensive surveillance cameras on the docks revealed no vehicles being loaded other than company trucks, which were only being loaded under the watchful eye of the Security Officer who signed off on every shipping document, indicating the paperwork matched each pallet load of inventory.
Down in a small village just south of the United States border, a large cheese manufacturing operation was heavily dependent upon stolen milk and cream furnished by thieves from our client company; the operation involved not less than 4 pallet loads of heavy cream and 10 pallets of milk each week. Losses to the dairy supplying the stolen product ran into the hundreds of thousands of dollars per year.
When our Undercover Operative (“UC”) was initially approached, it wasn’t about getting involved in the theft ring; he was first “tested” with illegal drugs. After a few friendly conversations about smoking “pot,” a Shipping Department assistant manager named Steve offered our UC a “joint” as the shift ended on a Friday afternoon. Having made arrangements in advance with the local police to receive illegal drugs during this workplace investigation, the UC accepted it. Immediately after his shift ended, the UC delivered the marijuana to a narcotics officer with the local police, according to plans. The drugs were neither requested nor solicited, and the UC was not acting as an “agent of the police,” because he received all his instructions from a Supervisor at our PI firm.
Drugs and theft go hand-in-hand, because thieves know once they’ve corrupted someone in authority with illegal drugs, be it Security Officers or their own bosses, they’ve developed very powerful tools; the bond between criminals is strong. Security Officers and Supervisors engaged in drug activity with other employees give up a great deal of authority and power; they’re forced to, in the very least, “turn a blind eye” to theft and other violations. This is the “blackmail effect” illegal drugs often bring to the equation in the workplaces of America.
After our UC became engaged in receiving marijuana at work, only a virtual nanosecond later he was offered the opportunity to make some good “side money” by signing off on loads of stolen milk and cream. He immediately complied, and we were well on the way to solving the theft case for our client. This allowed us to begin assimilating good and usable evidence as to exactly who was involved, and to whom the client’s dairy products were being sold “out the back door.”
Our surveillance team was spirited into action; within a few days, we videotaped not only the loading of extra pallets of product, but we followed the driver to his destinations and discovered one of the companies on his route received 4 pallet loads of product when their shipping orders only accounted for two. Additional surveillance revealed a client company employee, Assistant Manager “Steve” of the first shift Shipping Department, arrived the following day in a 1-ton pickup truck and received 2 pallet loads of stolen product on his vehicle – all caught on tape.
Meanwhile, back at the dairy, our UC Security Officer was paid. He received an envelope stuffed with $20 bills; the money transfer took place during the lunch break, on camera, in a quiet corner of the company parking lot, next to a specially equipped surveillance van in which our investigators documented the transfer with videotape
Another surveillance team followed the Assistant Manager from the client’s customer’s docks, all the way to the International Border at Mexicali, Mexico, where the stolen product was sold to a Mexican merchant who held a license to deliver goods across the international border into Mexico. The name of his trucking firm was painted on the door of his truck, making our job that much easier. The movement of the product between vehicles was well documented on videotape, as well as the counting of United States currency from the billfold of one man to the hand of the other. Our investigative associate in Mexicali picked up the surveillance and documented the order being delivered to the cheese manufacturer.
With this kind of evidence, the case was nearly closed… all that remained was interviewing the suspects, recovering the stolen product, and following the client’s instructions as to prosecution.
In the case just described, the client and their attorneys decided to prosecute the thieves and receivers of stolen merchandise, and the case resulted in guilty pleas all around. When they saw the evidence we had gathered, it made more sense to the defense attorneys to have their clients, the thieves we identified, “throw themselves on the mercy of the courts.” Both merchants involved in the theft ring were forced to pay restitution to the client. The employees involved in theft were interviewed by highly skilled and well trained interviewers (in both English and Spanish), leading to their admissions of guilt and were finally terminated and criminally prosecuted with no further repercussions.
From beginning to end, the entire undercover operation took less than twelve weeks; most of the expense of the investigation was born by perpetrators of the crime through court-ordered restitution, and the intangible savings to the client over the next year could have easily been “six figures.”
This case was not unusual. It would surprise the average employer how easily theft rings develop within the ranks of trusted associates. Security Guards aren’t the only remedy, and are often a part of the problem, of internal theft in the workplace.
If you know of a company experiencing inventory shortages in spite of all the normal precautions, including cameras on the docks and the hiring of Security Guards, you might do well to have them contact a competent Private Investigation firm specializing in workplace internal investigations.
Having uniformed guards with sharp uniforms and shiny badges may provide the appearance of security, but “never let your guard down,” because there’s no substitute for the truth.
Diversified Risk Management, Inc., is a licensed investigative firm specializing in workplace investigations for employers and the attorneys who represent them.
About the Author
Attended State Police Academies in Austin , Texas, Tulsa, Oklahoma and Los Angeles, California. Academic majors in English and Psychology at Texas Wesleyan College (now Texas Wesleyan University) and North Texas State University (now University of North Texas), Denton, Texas. Served on the Faculty Advisory Board of California State University (Dominguez Hills campus) for more than ten years as Visiting Professor in a program styled “Continuing Education for Human Resource Professionals.” This is a college-credit course for professional HR managers seeking SPHR certification (Senior Manager of Human Resources) as authorized by the Society of Human Resources Management (SHRM). Mr. Perkins instructed HR managers and attorneys on conducting workplace investigations safely, legally, thoroughly, and effectively.
For more information call us at 800.810.9508 or email@example.com