It’s October, which means spooky season is here. With freight fraud and cargo thefts reaching new heights in 2024, routine trips and loads can quickly turn into a nightmare for carriers, brokers, and drivers at the most innocuous of times. While missed or late deliveries and time spent in detention can be scary on a day-to-day basis, fraud has a massive impact on the bottom line every time it’s carried out successfully. 

According to TIA’s recently published “State of Fraud in the Industry 2024 Report,” the per-load cost of fraud reported by respondents was over $40,000 from February to August 2024. That’s much more frightening to the industry than being asked if you like scary movies by a mysterious voice on the other end of the call. 

This Halloween, let’s look at five of the scariest fraud schemes haunting the freight industry. 

1. Double brokering

Double brokering tops the list as the most prevalent form of fraud in the freight sector, according to the TIA report.  

This scheme occurs when a freight broker accepts a shipment but then re-brokers it to another carrier or broker without informing the original shipper. This practice typically leads to issues with accountability, visibility, delivery, and payment, increasing the risk of fraud and cargo theft. 

With about a third of reported fraud cases from the TIA report linked to double brokering or other unlawful brokerage plans, it’s clear this is a terrifying trend that won’t disappear anytime soon. 

2. Physical cargo theft

In Halloween terms, physical cargo theft is like that front yard skeleton or a Michael Myers costume — a very traditional thing that hasn’t gone away with time.  

These conventional fraudsters target truck stops or yards to steal freight and might disguise themselves as legitimate operators or take advantage of distracted drivers. As the holidays approach, this crime may skyrocket, making it even more critical for carriers and the brokers that work with them to be on guard. 

3. Motor carrier number manipulation

Motor carrier number manipulation is a more modern and sophisticated scheme than others listed in this article. In this plot, scammers purchase motor carrier numbers that are being unused to pose as legitimate freight carriers. Then, a broker works with the carrier, who appears from all indications to be a reputable hauler.  

A recent LinkedIn post from a freight agent who works in Mexico and the U.S. highlighted this brazen scam, illustrating just how easy it is for fraudsters to exploit those who don’t have their guard up. When carriers and brokers unknowingly cooperate with these imposters, substantial financial damage and ruined reputations may follow.  

4. Driver in need

Fraudsters frequently exploit the kindness of drivers by posing as stranded individuals in need. These scammers often request cash for fuel or repairs, preying on the compassion and togetherness of truckers. It’s a scary reality that can lead to financial losses for drivers who want to lend a helping hand. Being cautious and verifying identities can help prevent falling victim to this emotionally manipulative scheme. 

5. Cyberattacks

The rise of technology in the freight industry has also created more opportunities for cyberattacks. Hacking into company data and stealing personally identifiable information has become increasingly common, making it the third most prevalent fraud scheme per the TIA report.  

These attacks can lead to identity theft and financial losses, shaking the very foundation of trust in business relationships. Implementing robust cybersecurity protocols and training employees can help fortify defenses against these stealthy intrusions. 

This fall, fling fraudsters into the fog 

While these fraud schemes may seem like nothing short of a conjuring, preparation and diligence can lessen your fraud risk. Carriers and brokers should prioritize vetting and verification processes to protect against these schemes, while drivers should be cautious and employ physical security measures.  

By fostering a culture of awareness and vigilance, widespread freight fraud can make a visit to the undertaker. This Halloween, let’s work together to keep our industry safe from the ghoulish grip of fraud.