ACOM8334 1 0619 Theft White Paper - Allianz Insurance

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THEFT– A PROACTIVE APPROACH IS THEBEST PREVENTATIVE STRATEGY

THEFT – A PROACTIVE APPROACH IS THE BEST PREVENTATIVE STRATEGYINTRODUCTIONTheft – a proactive approach isthe best preventative strategy.An increase in incidences of theft is currently being seen across the UK1,impacting both businesses and individuals. Whether it’s a bicycle or alarge piece of construction equipment that’s stolen, being a victim of theftcan be extremely distressing, often compounded by the knowledge thatthere’s only a limited chance of recovering the stolen item.Thieves are taking goods both openlyand covertly, continually devisingnew methods for illegally acquiringitems. Further, with developments intechnology, it’s no longer just the theftof tangibles which causes concern butincreasingly online theft and fraudis becoming a serious issue. Withmounting pressure on police resourceto investigate and apprehend thesecriminals, it’s prudent for individuals toadopt preventative measures to stop thecrimes occurring in the first place.1 Office for National Statistics. Crime in England and Wales: year ending June dandwalesyearendingjune20182 Source: Allianz Insurance internal claims data, 2015-20181Are we experiencing a theft epidemic?With numbers of insurance claims risingacross many areas including motortheft, tool theft and construction planttheft², insurers certainly suspect thisis the case. This white paper looks atwhy and where incidences of theft areparticularly high and considers particulartrends to be aware of. What kind ofpreventive measures could businessesand individuals consider and what couldbe the underlying reasons for this rise intheft crime?

THEFT – A PROACTIVE APPROACH IS THE BEST PREVENTATIVE STRATEGYThere’s been an 8% increase in overall theft offences according to the CrimeSurvey for England and Wales (CSEW), with 3,591,000 cases reported betweenJuly 2017 and June 2018.2

THEFT – A PROACTIVE APPROACH IS THE BEST PREVENTATIVE STRATEGYFACTORSDRIVING THEFTTHERE CAN BE NO SINGLE ANSWER AS TO WHY WE ARE SEEINGMORE THEFT OCCUR, BUT RATHER IT SEEMS TO BE A COMBINATIONOF VARIOUS SOCIO-ECONOMIC AND POLITICAL FACTORS:UK ECONOMYRISE OF ORGANISED CRIMEWhilst unemployment may be at itslowest level in four decades with 32.6memployed between October andDecember 20183, the UK is showingpossible signs of entering an economicdownturn. Uncertainty about the outcomeof Brexit has led to concerns about jobsecurity and income, plus a reported16% of all UK businesses state they havemade relocation plans as a result ofthe referendum4. Consumer confidenceremains low in the current political climate,mirrored by falling high street sales, plusinterest rates have risen to 0.75%. Thereis a worry we are heading into recessionwith some predictions stating this couldbe realised within three years. Crimetypically rises in recessionary periodswhich could be a contributing factor tothe current spike in UK theft trends.According to the National Crime Agency,organised crime costs the UK over 34bneach year5. With the internet and socialmedia enabling ever-faster and widercommunication, it’s easier to facilitatetheft and the movement of stolen goodsmore quickly and easily than ever before.Criminals are also making use of encryptedcommunication apps to aid this activity.In the commercial space, thieves aretargeting cash-intensive businesses andATMs, often with mounting levels ofviolence. Increasingly, gangs are turningtheir attention to remote locations andbusiness parks where police response isslower. In organised vehicle theft, criminalsseek to profit from reselling stolen vehiclesand parts, or may use the vehicles to carryout further criminal acts, such as robberies.3 Clegg, R. (2019). UK Labour Market – Office for National Statistics. [online] Ons.gov.uk4 Iod.com. (2019). Nearly a third of firms looking overseas due to Brexit Institute of Directors IoD5 Nationalcrimeagency.gov.uk. National Crime Agency – About us http://www.nationalcrimeagency.gov.uk/about-us3

THEFT – A PROACTIVE APPROACH IS THE BEST PREVENTATIVE STRATEGYTECHNOLOGY ISFACILITATING THEFTREDUCTION INPOLICE NUMBERSGoogle has stressed its Street View doesnot encourage crime, but some criticshave said it shows too much informationand therefore could aid burglars inspotting properties that may be easierto break into. Meanwhile, social mediause could also result in thieves gainingadvantageous knowledge if usersprovide information about when theyare away from their properties orbusinesses.Former home secretaries had saidthat falling crime justified cuttingpolice numbers and re-allocatingthese to focus on other areas, such ascyber-crime and terrorism. However,a rise in crime across the board hasset alarm bells ringing that the cutswere too severe. The current HomeSecretary, Sajid Javid, has said heis ‘listening’ to police concerns andwill seek to boost funding if it isWhilst most people use the ‘surfaceweb’, which only allows access to sitessearchable through major searchengines, the dark web can only beaccessed with special web technologies.This is a playground for criminals whobenefit from the anonymity the darkweb affords, and who use it to carryout illegal activities, such as buying andselling illicit goods.necessary.7WEALTH ‘INEQUALITY’Despite high employment, there remain anestimated 14 million people living below thepoverty line, according to a 2017 report bythe JRF Analysis Unit.8 This may include thosewith insecure ‘zero contract’ jobs or those withno income at all. Some argue that austeritypolicies have worsened matters and claim theUK has ‘a very high level of income inequalitycompared to other developed countries.’9As is evident from the above, the factorsdriving theft are manifold and complex.The next section examines the differentareas where theft trends are being seen, withguidance on how to mitigate such activity.In the motor space, technologydesigned for convenience and safetycan inadvertently create security issues.Keyless vehicle entry systems are onesuch example, where criminals arecapitalising on this technology to gainunauthorised access to a vehicle.For more information, read our article,“Keyless cars: Vulnerable to theft”.THEFT CAN BE ‘TOO EASY’Thieves learn ‘tricks of the trade’ andcan become faster and more efficientat what they do. Selling items is alsofacilitated by various online shoppingwebsites, where vast numbers of goodscan be sold at speed and where fullchecks would be impractical. Forexample, a former London bicycle thief 6has explained how he was easily ableto obtain tools to crack locks, stealexpensive bikes and then sell them viaan online platform.6 Weekly, C. (2017). Bike thief reveals tricks of the trade in this shockingly candid interview – Cycling did-interview-2251307 Dodd, V. (2018). Sajid Javid seeks to win over police with funding pledge.The ew-funding-pledge8 Barnard, H. (2017). UK Poverty 2017. Joseph Rowntree Foundation. https://www.jrf.org.uk/report/uk-poverty-20179 Equalitytrust.org.uk. (n.d.). The Scale of Economic Inequality in the UK The Equality Trust. equality-uk4

THEFT – A PROACTIVE APPROACH IS THE BEST PREVENTATIVE STRATEGYTHEFT TRENDSAND TECHNIQUES– A DEEP DIVEMOTOR THEFTIn November 2018, the Association of BritishInsurers announced the cost of motor theftclaims10 – some 271 million – rose by a thirdon the previous year, with the number ofclaims settled rising by 11% over the sameperiod. The trade body said that the increasewas in part linked to keyless vehicle theft.Technology is generally viewed as a way ofboosting security, but the arrival of keylesscars have enabled th llingCCTV, ensuring that doors and windowfittings are secure and that the property iswell maintained, whether occupied or not.It can also be worthwhile for companies toengage with other local businesses, such ascrime prevention schemes. Also, it’s advisedto undertake checks on visitors to the buildingand implement processes such as signing in/out systems and visitor security passes.14 L ocksmith Service. (2017). Commercial property thefts per London y-thefts-per-london-borough6

THEFT – A PROACTIVE APPROACH IS THE BEST PREVENTATIVE STRATEGYTRADESPEOPLE – HIT BY SOARINGTOOL THEFTWhile vans are being targeted by thieves, it may bethe contents within which is even more attractive.Having crucial tools stolen can be devastatingfor tradespeople and what’s more, thieves willoften damage a van to get at the contents inside.It’s a crime which causes huge frustration as wellas economic misery for the business owner, pluspotential delays for customers.In October, the Federation of Master Buildersfound that some 51% of builders had been victimsof tool theft. According to the trade association’sChief Executive, Brian Berry, “More than halfof builders in the UK have fallen foul of tooltheft with concerns growing over a crime wavewreaking havoc across the construction industry.Tools are being stolen from vans and direct fromconstruction sites, with some builders even beingassaulted by would-be thieves.”Of these tool theft cases, some 46% had resulted inthe side panel of the van being broken or piercedor prised open, 23% had windows smashed and22% involved locks being picked.KEEPING TOOLS SAFEIt’s now common to see signs on vansstating that no tools are left in thevehicle at night and because of theft,far more tradespeople are bringingin their tools at night, installing extralocks and where possible, parkingagainst a wall.7Tools with recognisable brands are less appealingto criminals wishing to sell them on, when the brandname has been removed or where they have beenmarked with sprays or dyes. It’s a good idea to takephotographs of tools, including any serial numbers,helping to trace them to the rightful owner in the caseof them being recovered.Whilst CCTV signs may cause some criminals to thinktwice, they aren’t a sure-fire deterrent. Adding in extrasecurity measures such as locking tools with a securitychain or installing a truck alarm system can certainlyassist in theft prevention. Having appropriateinsurance in place is always recommended, shouldthe worst happen and the thieves be successful intheir crime.SOME TIPS TO PREVENT TOOL THEFT: Never leave your tools in the back seat of a vehicle;instead lock them away in a secure cabinet. Double up on security with a hardened-steelsecurity chain and high quality padlocks. Add GPS trackers to tools – these often work inconjunction with smart phone apps to remotelytrack the item’s location. Engrave personal information or identifying markspermanently on the tool. Park in well-lit areas wherever possible. Consider installing a truck alarm system.

THEFT – A PROACTIVE APPROACH IS THE BEST PREVENTATIVE STRATEGYCONSTRUCTION PLANT THEFTREACHES NEW HEIGHTSPlant and machinery are valuable commodities asthieves are only too well aware and constructionsites are increasingly being targeted by criminals.Research by Allianz Insurance plc found planttheft claims rose steadily between 2013 and 2017;– there were a recorded 428 instances of planttheft in 2013 but this increased to 665 in 2017 andhad hit 730 by the end of 2018.15 It’s believed thatorganised gangs are behind many of the crimes,with other cases being purely opportunistic. Themost valuable stolen items may well be shippedabroad where they are sold either in their existingstate or for parts.Whilst tools are coveted as an easily portablestolen item, the research also found largeritems of plant such as excavators can provide alucrative haul for criminals. These are expensiveclaims and thieves are often determined tosecure them; indeed there are cases where onsitestaff have been threatened and the machineryremoved by force. Stolen excavators have alsobeen used to rip out ATM machines from walls,resulting not only in the value of the cash, but alsoextensive property damage.Criminals may also fraudulently hire high valueplant, pretending to be an authentic companyand using genuine details they have obtainedillicitly. Once they have access to it, they arrangefor its sale, perhaps via the dark web, and thendisappear with the proceeds.HIGHEST FREQUENCY OF PLANT THEFT CLAIMS:Allianz Insurance plc research1 Tools2 Surveying equipment3 Breakers4 Excavators/diggers5 Generators6 Rollers7 Wacker plates8 Pressure/power washers“plant theft claimsrose steadily between2013 and 2017”15 roker/en commercial/construction-plant-theftis-on-the-rise/ jcr struction-plant-theft-on-the-rise acom8166.pdf8

THEFT – A PROACTIVE APPROACH IS THE BEST PREVENTATIVE STRATEGYWAYS TO PROTECT PLANTBecause of the high earning potential, thieves willgo to great lengths to steal plant, cutting throughfencing and avoiding or damaging CCTV equipment.Immobilisers are worthwhile and trackers can beextremely useful – although if equipment is takenabroad quickly, it may be difficult to locate andreturn and thieves may also be able to disable orremove such equipment.Certainly, having a security presence can help inensuring there is monitoring of who is on- and off-site.Turnstiles, swipe cards and finger-print recognitionsystems are all beneficial and it should be a prioritythat the entire workforce is engaged with the need tokeep plant safe and to play their role as the eyes andears of the company. This is applicable at all levels,including those with responsibility for checking thecredentials of any firm that requests hiring plant. It’sencouraged to register plant with the Construction& Agricultural Equipment Security and RegistrationScheme (CESAR).More information can be found in our article,“Construction Plant Theft is on the Rise”.METAL THEFT – REMAININGPROBLEMATICAt the end of 2017, the government announced thatmetal theft had fallen by more than three quartersin four years because of action it took to reduce thecrime. This was through reviewing the Scrap MetalDealers Act 2013 that brought in measures to tightenregulations and licencing, making it more difficult todispose of stolen metal. While thieves might make 300 from a catalytic converter, car owners are leftwith repair bills of 2,000.But, fast forward to 2019 and it seems this crime isstill present. A 2018 report in The Telegraph coveredgangs ‘stripping cars of catalytic converters in broaddaylight to steal valuable metal.’16 The prize is therhodium, palladium and platinum in the deviceswhich can be recycled for use in jewellery, dentistryand electronics. Rhodium is worth up to 2,000an ounce, twice the value of gold. Palladium andplatinum trade at 70% to 80% the value of gold. Thereport said a crime wave is underway reversing thedecline in metal theft.Meanwhile, the British Metals Recycling Associationhas said there are increasing reports of theft of leadand copper from church roofs, copper rail signallingcable and iron drain grates.TAKING A STANDPreventing the theft of a converter is no easymatter as police recommend the etching ofsecurity details or installing extra bolts, butdefensive parking against a wall may be aneasier alternative. As for churches and otherbuildings where metal theft may be a risk,typically those which have lead on roofs,taking advice from their broker or insurermay be the best strategy. Isolated buildingswhere there is poor security will always bemost at risk, which is why CCTV, alarms andregular security checks are essential.16 t-steal/9

THEFT – A PROACTIVE APPROACH IS THE BEST PREVENTATIVE STRATEGYCYBER CRIME AND IDENTITY THEFTTHIS INCLUDES:Despite raised awareness and advances in security,identity theft continues to be a major problem. TheCifas Fraudscape survey showed a small 1% rise in2017 over the previous year, but this is still a 125%increase compared to 10 years ago.17 Monitoring and protecting the use of computerequipment and systems.Businesses are starting to become aware of thethreat that cyber-crime poses. A malicious hackcan result in a data breach, diminished consumerconfidence and reputational and/or financialdamage. The Wannacry and Petya ransomwareattacks in 2017 were two of the biggest cyberattacks seen so far, with Wannacry affectingorganisations in 150 countries, with an estimatedcost of 6bn to the global economy. It’s importantfor businesses to understand their exposure tocyber-attacks and take reasonable steps to reducethe likelihood of an incident. Educating and encouraging employees in theimportance of using strong, secure passwordsand locking PC screens when away from desks. Raising awareness of the potential dangers ofopening emails or attachments from unknownsenders. Conducting regular audits performed by cybersecurity consultants, or appointing a datasecurity officer.THERE IS NOW MORE POLICE RESOURCE INVESTED INTACKLING GLOBAL CYBER-CRIME AND, INDEED, A FEWHIGH PROFILE ARRESTS HAVE BEEN MADE. BUT, THISIS A CONSTANTLY CHALLENGING CRIME AND MANYCRIMINALS, BASED ALL OVER THE WORLD, CONTINUETO STEAL WITH IMPUNITY.17 s/documents/External-Fraudscape%202018-Final.pdf10

THEFT – A PROACTIVE APPROACH IS THE BEST PREVENTATIVE STRATEGYCONCLUSIONThere is currently much uncertainty aroundthe UK’s future, but blaming Brexit, politiciansor even parenting is not going to change thecurrent reality.It seems that in order to combat the problem, onesolution lies in educating businesses and individualson how to do more to prevent theft themselves.Certainly in the case of tackling rising theft trends,the old proverb seems the most apt that,“prevention is betterthan cure”.Disclaimer: Commentary and guidance in this article are provided for information purposes only and are not intended to amount to adviceon which reliance should be placed. Readers should seek further advice when dealing with their individual and particular situations.Allianz Insurance plc shall have no liability for any action taken as a result of and in reliance on the information contained in this article.11

allianz.co.ukAllianz Insurance plc.Registered in England number 84638Registered office: 57 Ladymead, Guildford,Surrey GU1 1DB, United Kingdom.Allianz Insurance plc is authorised by the PrudentialRegulation Authority and regulated by the FinancialConduct Authority and the Prudential Regulation Authority.ACOM8334 1 06.19Financial Services Register number 121849.

MOTOR THEFT In November 2018, the Association of British Insurers announced the cost of motor theft claims10 - some 271 million - rose by a third on the previous year, with the number of claims settled rising by 11% over the same period. The trade body said that the increase was in part linked to keyless vehicle theft.