The next generation of intermodal security
- By Rebecca Ufkes
- Jul 01, 2013
Cargo theft is the costliest crime in America, reporting an estimated
$25 billion in merchandise stolen, with incidents on the rise, according
to the International Cargo Security Council. Moreover,
the American Association of Ports Authorities cites that there is
$60 billion in indirect costs associated with cargo theft.
Insurance prices for shipping high-value loads are on the rise. In many cases, 10
percent of the value of the cargo is paid to insurance companies; this figure may
equate to millions of dollars. Why is it so high? Because most shipping containers
are handled by up to five different intermodal freight transportation methods
from origin to destination. This makes it very difficult for insurance companies to
discern when and where a theft or damage incident took place and therefore, it is
difficult to hold a particular transportation entity liable for the loss.
The Costly Issue of Cargo
Founded in 1995, Charleston, S.C.-based UEC Electronics, LLC (UEC) is one of
more than 250 defense contractors providing next-generation technology for both
the private and public sectors. A female-owned, small business, UEC specializes
in a variety of engineering expertise, including security; electronics; hybrid power
generation; smart power distribution; and automated systems for military, aerospace
and industrial customers. Currently, UEC is working toward a solution for
one of the security industry’s most pressing problems—intelligent asset protection.
When a container arrives at its final destination and the purchaser discovers
pilferage, they file a claim. Insurance companies respond the only way they can—
they pass the costs of losses on to their customers through increased premiums,
who in turn, pass it on to consumers.
Not only is unsecure cargo costly, it also is dangerous. Terrorist activity resulted
in the creation of the Department of Homeland Security, which clearly recognizes
the vulnerability of our seaports. A decade ago, approximately 2 percent of the estimated
252 million container shipments worldwide were inspected, with approximately
17 million containers entering the United States on an annual basis. The
United States has 360 commercial ports and 3,200 cargo and passenger handling
facilities, according the U.S. Coast Guard. This provided terrorists a 98 percent
probability of success to use a container as a potential bomb or for carrying nefarious
supplies into the country.
As a result, custom authorities expressed the need for a means to implement
Electronics Declaration and Electronics Acquittals for inbound freight to enable
a streamlined process to ensure that the contents of freight containers correspond
with manifest changes. In addition, the physical status of container sealing mechanisms
can be automatically detected before goods are cleared. Goods destined for
export will be detected at border posts and sealing mechanisms verified against
inbound status enabling identification of discrepancies.
Traditional bolt seals and padlocks for shipping containers and cargo trailers
are a mere bolt-cutter away from easy access and do not address today’s security
challenges, which include uncontrolled or poorly controlled access to cargo (assets),
unclear responsibility for shortage and damage; cargo access required by
multiple disparate parties; poor or non-existent tracking of goods; lack of cargo
access traceability; expensive key management and lock replacement; secure oncontainer
manifest storage and the high cost of frequent customs inspections.
With a combination of innovation and current technologies, this vicious cycle
can now be managed more effectively.
A ‘Core’ Solution
Philip Ufkes, principal of Security Enhancement Systems (SES), worked with
UEC Electronics to develop a patent-pending, keyless, electronic-locking device
called the Core Defender. This newcomer in the market is the product the cargo,
transportation and storage markets have been longing for. The device combines a rugged, stainless-steel, dual-ratcheting lock mechanism that fixes easily to and secures the keeper bars on any standard shipping container or cargo trailer with
intelligent keyless access control, providing a real-time log of container lock, unlock,
or tamper events, including the date, time and operator.
The base Core Defender incorporates two levels of intrusion and tamper detection.
The novel, secure, keyless access ensures that when international shipment is
required, the load is accessible by customs and border authorities, and a record of
that inspection is maintained digitally along with the electronic manifest. The incorporation
of an intelligent security device is a means to not only discourage theft
but also determine a geographical location where a theft occurred and specifically
identify anyone who had access to the cargo.
Why is this product and technology a significant game changer? Theft has been
an unresolvable, uncontrollable and an extremely costly occurrence in the asset
transportation and storage industry. Disgruntled drivers, unappreciated dispatchers,
and current and former employees who are supplementing their incomes are
most often to blame. Electronic access traceability combined with dynamic access
codes provide leadership with the tools to quickly identify and proactively prevent
problems before they impact their customer, insurance premiums or the bottom line.
How does this technology work? A Dynamic Access Code (DAC) is transmitted
to the device via secure encrypted Bluetooth technology. Once authenticated,
the operator may lock or unlock the device or download the electronic manifest.
Keys and combinations are ancient technology. Smartphones have become a ubiquitous
do-all computing device for various applications and are an essential part
of our daily lives. Core Defender uses the operator’s cell phone or any smart device
as a highly secure access channel—no cellular signal required.
The DAC is provided automatically by a resident software app that accesses the
central system via a secure internet connection. Optionally, when no internet access
is available, the company dispatcher can provide the required code. A record
of the code acquisition is maintained for traceability. The DAC is only valid for
a predetermined period of time and is unique to that particular device; optionally,
the device may be configured with a static access code. A simple system entry
removes the operator from the list of authorized users; no keys to collect, locks
to re-core or replace. Expensive and burdensome key-management logistics are a
thing of the past.
In addition to the features above, lock, unlock and tamper events are logged
throughout transit and are available for review at any time by authorized staff.
The manifest is safely and securely stored electronically within the lock—no more
lost or damaged paperwork. The security products provide real-time visibility of
the chain of custody and provides a comprehensive audit trail. This is useful for
the DoD and other government entities where asset security is a significant issue
and challenge. It also provides a cost-effective, secure, auditable, easily managed,
enhanced security system—an unseen product eagerly needed by the market.
Beyond the Product
UEC seeks to combine its engineering and manufacturing expertise to provide its
customers with a unique opportunity to realize the full potential of their intellectual
property, minimize schedule and development risk, and improve product quality.
Entrepreneurial product development, such as the Core Defender, provides
a creative departure from EIC’s primary DoD and aerospace engineering and
manufacturing activities. We continue to diversify our work to include private
sector projects. Key to UEC’s success is using our in-house engineering talent
and sourcing from Charleston’s growing pool of engineers,
which ranks among the nation’s fastest growing. UEC’s cargo
theft protection is an example of how the same workforce that
produces technology for the military also is providing innovation
for private industry.
This article originally appeared in the July 2013 issue of Security Today.
Rebecca Ufkes is the president of UEC Electronics, LLC.