Articles
Articles from the Chapter Membership
We thank Don Turnage, CPP, for his contribution "Make Theft a Non-Starter". For other articles from the chapter membership, scroll to the bottom of the page.We encourage all members of ASIS Chapter 119 to submit their security related Articles and White Papers. To share your own expertise and experiences with the chapter membership contact anitaj@pronetsystemsnc.com.
Make Theft a Non-Starter
By Donald R. Turnage, CPP
It all began nearly three years ago in June of 1999--or so we thought. In fact, as the investigation would ultimately reveal, the thefts had been going on for quite some time, but the full extent of the crime wave did not become clear until much later. In the summer of 1999, the events that would lead to the discovery of the magnetic starter thefts were just beginning to unfold.
It was a quiet Monday morning. The superintendent at the Vulcan Materials Company's rock quarry in Cabarrus County, North Carolina--just northeast of Charlotte--arrived at work, as he always did, around 6 a.m. Everything appeared just as it had at the close of business the previous Friday. Yet when the superintendent threw the switch to start the huge electric motors that ran the conveyor belt, nothing happened.
Suspecting an electrical malfunction, he checked the powerhouse where all of the electrical controls were housed. Nine magnetic starters--electric transformers used to start huge electric motors of 100 horsepower and up--had been stolen. Thus began the tale of a crime spree that would take years, many false leads, and extensive cooperation among businesses, associations, and law enforcement to solve.
In the ensuing weeks, similar robberies occurred at various Vulcan aggregate sites (aggregate companies mine rocks and crush them into gravel or sand to sell to builders). All of the incidents were reported to local police or sheriff's departments. In each case, superintendents of the rock quarries were interviewed, a list of the stolen property was taken, and the case was dispatched to an inactive file due to lack of evidence.
One significant problem was that the starters lacked serial numbers or unique markings that would identify them as Vulcan property. Without any witnesses, fingerprints, suspects, CCTV footage, or other leads, the crimes fell to the back of the detectives' heavy caseloads.
By October 1999, ten known break-ins, all similar to the one that occurred at the Vulcan plant in Cabarrus County, had occurred. As Vulcan began investigating the thefts and tightening site security with better locks, the thieves began hitting other aggregate companies as well, including Martin Marietta, Hedrick Industries, Rea Construction Company, and Hanson Aggregates.
Most of the crimes were occurring between Winston-Salem and Asheville in North Carolina. As time went on, asphalt plants, typically located close to aggregate companies for easy transfer of crushed stone, also became targets. Tired of being a repeat victim, Vulcan hired Risk Management Associates (RMA), a security firm in Raleigh that specializes in security consulting and criminal investigations for corporate clients. The author, who works at RMA, was brought in to investigate the case.
The crime spree continued to spread. By January 2000, the break-ins had extended as far east as Raleigh, and reports were coming in of similar break-ins in Virginia and South Carolina. In most of the thefts, an average of four to ten magnetic starters were disappearing. They cost $3,000 to $6,000 apiece to replace. Also stolen in some cases were electrical breakers, costing as much as $10,000 each, along with various electrical and hand tools.
As was the case with Vulcan, the other victimized companies did not have identifying marks or serial numbers on the stolen merchandise. Exacerbating these physical losses was the downtime faced while new starters were ordered and reinstalled--anywhere from one to three days. The total loss in some break-ins exceeded $100,000 in lost equipment and production. On average, the loss per incident was $30,000 to $40,000.
Spreading the word.
Since the thefts were occurring in many different jurisdictions, the RMA investigator (the author) decided to publicize the thefts and keep all affected law enforcement agencies informed of what was happening elsewhere. In time, the information was also being distributed to all law enforcement agencies in North Carolina and the southeastern United States through the North Carolina Crime Information Exchange and the Regional Organized Crime Information Center. Several of the agencies used Crime Stoppers programs to get the information out to the public in hopes of getting a lead that might help police make an arrest.
Beyond law enforcement, companies, trade associations, and other interested organizations were added to the information network, and the author kept these groups apprised of developments in the investigation. These agencies were instrumental in helping to link investigators with asphalt and aggregate companies. The author also contacted numerous business establishments that sold or dealt with starters throughout North Carolina, Virginia, and West Virginia to seek and gather information and strengthen the network.
Compiling evidence.
Once this network was established, the next task was to compile a dossier of the magnetic starter crimes. For a year and a half, the author spoke to hundreds of law enforcement officers, organizations, and companies to create a dossier of the crimes and a criminal profile. In addition, in an attempt to determine a market for the stolen starters, the investigators contacted various merchants and dealers throughout North Carolina who sold starters, but that trail provided no leads.
Magnetic starters are also frequently used in coal mines, which abound in nearby West Virginia. Calls to dealers of magnetic starters there revealed that thefts of starters and other electrical equipment had afflicted that state for the past fifteen years. Dealers confided that it was easy to get rid of "hot" starters in West Virginia because small dealers and unscrupulous dealers would buy them with no questions asked. Thus, attention focused on West Virginia as the source of potential fencing operations.
As the pieces came together, a clearer picture of the suspects emerged, primarily where and how they were operating. By February 2000, a number of characteristics emerged from the various break-ins that could help to identify the thieves.
Most of the break-ins occurred along interstate corridors I-40, I-77, and I-95, especially along I-40 west from Winston-Salem to Asheville. The thieves would park some distance away from the site and walk onto the property. Wearing gloves to conceal their fingerprints, they would haul off equipment with the company's own wheelbarrows, trash cans, and other receptacles.
Every time the author got word of a new break-in, he contacted the supervisor at the quarry and the investigating municipal or sheriff's department detective assigned to the case. The author entered this information on a spreadsheet and distributed it to law enforcement agencies in North Carolina, Virginia, and South Carolina.
The fact sheet contained the name of each victim company, its address, the investigating police agency, the name and telephone number of the investigator, the date and time of the theft, the property stolen and its dollar value, and a brief synopsis of what occurred along with any evidence that was collected. Frederick R. Allen, the executive director of the North Carolina Aggregates Association, helped establish contacts and get information to the victims. With his assistance, the author established a nationwide network of information on starter thefts.
While this investigation was proceeding, the North Carolina State Bureau of Investigation was also conducting its own probe into starter thefts. A November 1999 break-in at Midstate Contractors in Newton, in which thieves made off with magnetic starters and other tools worth almost $40,000, brought Newton police lieutenant Bruce Prestwood into the case. In turn, he asked for help from the state Bureau of Investigation, who assigned Agent Johnny Umphlet to the case. Umphlet, Prestwood, and the author coordinated their efforts and shared information on the cases.
After about six months of this crime spree, Vulcan made a concerted effort to stem the tide of theft--efforts had earlier been piecemeal in the belief that the crimes were sporadic. Vulcan managers assessed their rock quarry locations in North Carolina and Virginia. Nineteen locations were chosen as sites likely to be broken into, because these sites had not yet been hit and each was located near an interstate highway.
During February and March 2000, RMA investigators installed cameras and recording equipment inside these locations to supplement the investigation. The cameras were installed inside, rather than at entrances, because the lighting was much better inside. The cameras were intended to catch the criminals actually taking the goods rather than just entering the building.
None of these sites was broken into after the camera installations, although an attempted burglary did occur at one location near Asheville. The subjects trying to break in never got inside, where the camera was located; instead, they got scared away by a burglar alarm that had recently been installed unbeknownst to RMA.
Had RMA investigators known of the plans to install an alarm, the cameras would have been placed to view the outside of the facility. The incident is a reminder to companies of the need to coordinate all of their security efforts and to make sure that consultants and other third parties know what else is being done that might call for adjustments to their plans.
Enter the FBI.
Over time, it became evident that the scope of the crimes was so sweeping that more assistance was needed. Upon Umphlet's request, on June 5, 2000, FBI Special Agent Tom Glorioso entered the investigation to look into the possible violation of interstate transportation laws.
With the entry of the FBI, the investigation picked up momentum. At the same time, to encourage tips from the public, the author persuaded Vulcan and other victimized companies to compile a reward for information leading to the arrest of the person or persons responsible for the starter thefts. A reward of $16,000 was pledged, with the bulk of the money coming from Vulcan. A reward poster was sent to all of the companies, organizations, and law enforcement agencies involved with the case. The reward eventually helped the FBI to crack the case; the lure of money attracted the attention of a tipster who provided the crucial clues needed to track down the thieves.
The big break occurred in January 2001. An informant with knowledge of the case provided verifiable information to Umphlet. (Because this case was still open as of press time, the identity of this informant is being withheld for that person's safety.) Much of this information was confirmed by comparing it to the information recorded by the author on his extensive fact sheets as well as the criminal profile he had compiled.
The tipster named several people involved in the crime along with other information that appeared to be credible. Through checks of driving records, the suspects' cars were identified. The FBI then placed tracking devices on the suspects' cars and tracked them to their homes.
Around-the-clock surveillance was set up outside the Newton, North Carolina, home of two of the suspects: the ringleader and his wife. By conducting additional criminal records checks, further driving record checks, and other database checks, and by continuing to surveil the husband-and-wife suspects, other persons were soon identified and connected to the string of thefts.
It was critical to create a solid evidentiary foundation before arrests were made so that the culprits could be clearly linked to the thefts. Thus, the FBI watched the suspects until agents were able to observe those under surveillance committing break-ins. Agents then followed them on I-77 close to Charlotte, where they watched and videotaped the goods being transferred to fences.
It turned out that there was, in fact, a West Virginia fencing connection, as suspected. Fences came from West Virginia and the western part of Virginia to meet the thieves.
As the FBI gained enough information on each member of the crime group, agents picked that person up. The dossier and criminal profile prepared by the author helped link the criminals to the other magnetic starter thefts. For example, the FBI observed the thieves parking at a distance and walking to the site, wearing gloves, and carting the goods out in wheelbarrows and garbage cans. In a letter of appreciation, the FBI gave RMA much of the credit for raising awareness of the problem, linking the crimes, and ultimately solving the case.
When arrests were finally made, the extent of the crime wave was even more involved than the investigators had imagined. Not only were magnetic starters being taken and construction equipment being stolen from quarries and asphalt plants, but they were also disappearing from locations such as construction sites where schools and retail outlets were being erected. The perpetrators were also hitting locations in Maryland, Ohio, Pennsylvania, Tennessee, Kentucky, and West Virginia.
Altogether, at least seven people were found to be involved in the thefts, most of them with a West Virginia background. The suspects are believed to be involved in more than a hundred break-ins and thefts dating back to 1995 at mining operations, construction sites, and asphalt and aggregate plants in North Carolina, Virginia, West Virginia, Tennessee, Ohio, Pennsylvania, Maryland, Kentucky, and South Carolina.
Last July, a federal grand jury handed up an indictment to eleven members of the crime ring for violations relating to interstate transportation of stolen property. As of press time, charges were still pending on many of the members.
Lessons learned.
With their tremendously heavy and specialized equipment, these sorts of facilities had not been considered at high risk for theft, but the combined loss of millions of dollars of such equipment made Vulcan Materials Company and other aggregate and asphalt companies reevaluate that stance. The thefts taught many of these companies important lessons and encouraged them to take additional steps to secure valuable electrical equipment.
Several companies responded to the new threat by installing cameras, alarm systems, and better locks and doors, which have helped to protect the powerhouses where the equipment is installed. In some cases, lighting was added to better illuminate dark, isolated areas.
The increased awareness of all the companies has also helped to prevent thefts. Vulcan employees, for example, are now required to record license plate numbers and descriptions of anyone they find on the grounds without official clearance.
In addition, although manufacturers still do not assign serial numbers to magnetic starters, Vulcan now places its own unique ID markings on its equipment. Other companies are starting to follow suit. As a further preventive measure, the industry has agreed to share future information on thefts or other problems through organizations such as the North Carolina Aggregates Association and other organizations with ties to the aggregate companies.
The arrests and indictments of the eleven persons involved in the operations stopped the starter thefts at Vulcan. It has been almost a year since the last break-in. But another, unrelated group appears to be active in West Virginia. Companies recognize the need for continued vigilance.
This case demonstrates how important it is for companies to share information and to look beyond individual incidents of theft. It also shows how private security and law enforcement can work together to bring criminals to justice.
The other major lesson of this case is the importance of unglamorous, workmanlike investigative techniques. Though the thefts were cracked by an informant, the investigative team laid the groundwork by pursuing all plausible leads and cross-referencing reams of information. While many of the clues led investigators down blind alleys, ultimately the hard work sent the victimized companies on the road to recovery.
_____________________________________________________
Donald R. Turnage, CPP, CFE (certified fraud examiner), is a security consultant for Risk Management Associates, Inc., based in Raleigh, North Carolina. RMA performs investigations, technical surveillance countermeasures, and vulnerability analyses for large corporations, as well as security training and bomb training. Turnage served as a lieutenant in the Raleigh, North Carolina, Police Department, Investigative Division, for 15 years. He is a member of ASIS.
Other Articles
Security Officer Contract RFP'sSafeguarding Building Perimeters For Bomb Attacks
When Severe Weather Strikes
Choosing the Right Vendor
Key Control
Investigation