If car theft were a legitimate business, it would rank fifth among the Fortune 500 companies. Control Risks' Europe & FSU editor Bettina Wassener looks at the ever-growing problem of car crime, and contends that business can no longer ignore its effects.
Governments and business are belatedly waking up to the very real threat posed by vehicle crime. In December 1996, the UN sponsored a two-day conference in Warsaw which brought together law enforcers, insurers and car makers from about 30 countries. They gathered in order to propose strategies for fighting an international plague which costs billions of dollars a year and is increasingly viewed as being on a par with the narcotics trade. Such strategies, encompassed in the conference's draft recommendations, include the establishment of global databases, common registration and titling procedures, and better arrangements for returning vehicles identified as having been stolen in other countries. This last point is a current bugbear of European insurance firms, which often have to pay out 30 days after a car is stolen.
While not exactly a recent phenomenon, car theft has become much more international - and much more serious - since the collapse of communism. The tide of organised crime which has swelled up since the disintegration of the Soviet Union has provided both the incentive and the means for widescale car theft. In large east European and former Soviet cities, there is a great demand for foreign-made cars, which are seen as status symbols - around 25% of foreign-made cars on the streets of Moscow are stolen property. This is the incentive. But it is the well-organised network of criminal gangs across the continent which provides the means. Many criminal gangs started off stealing cars before extending their activities to other forms of crime and/or business: for example, the Avtomobilnaya gang is now a 'haulage company'!
Vehicle theft is one of the easiest ways of making money, and it provides high profits - more than gambling or prostitution. For example, Moscow criminals have been known to make up to $1m on a single luxury car. They sell it for slightly less than the usual price, wait a few days and then steal it back off the buyer - who, knowing that the car was stolen in the first place (hence the low price) won't go to the police. The gang then repeats this trick again and again, sometimes up to 20 or 30 times on a single car.
That much of the traffic in stolen cars is eastwards (from western Europe to the former communist bloc) throws up problems of its own. Countries which had previously simply been transit routes or recipients of smuggled stolen cars now have grave car theft problems themselves. One such country is Poland, which between 1994 and 1995 saw car theft rise by more than 20% to over 50,000 vehicles - including those of the top presidential security adviser and the Interior Minister's wife.
In contrast, the opposite trend is visible in several western European states: in 1995, thefts in Germany fell 8.8% to 129,652. One of the countries, however, which goes against this trend is the UK, where the phenomenon of 'joyriding' (rare in mainland Europe) pushes car theft statistics up. However, the UK also boasts much higher recovery rates (more than 66%, as opposed to under 50% in Germany), not only because cars stolen by joyriders are usually found, but also because the UK's being an island makes it much harder to smuggle cars out of the country.
German police expert Peter Koehler told the Warsaw conference that counteractive measures had cut car thefts in his country since 1994, with the trend continuing in the first half of 1996. But he said criminals were switching to new methods, including fraud against rental firms or insurers. Many owners are selling their cars to crooks, reporting them as stolen, and collecting from insurance companies. "We estimate that in about 30 to 50% of all cases, the owner of the vehicle is involved, although this is not yet supported by statistical evidence," Koehler said.
The effects for business are self-evident. Besides the cost and physical inconvenience of having a vehicle stolen, fraud against rental firms and insurers will simply force such outfits to push their prices and premiums up, with a direct knock-on effect to their customers.
So what can companies do to limit car theft? The glut of state-of-the-art security measures (including gadgets that will allow a stolen car to be traced electronically, be remotely disabled, or that will set a limit on the time or distance a vehicle can go before shutting down) should not obscure the validity of a few basic principles. Perhaps the most important is to choose the right car. Flashy vehicles are prime targets for thieves: if you are driving a luxury Mercedes round Moscow or a Toyota Landcruiser around Nairobi, you are far more likely to be singled out than if you are in a nondescript saloon. Sacrificing a degree of comfort can have its own rewards.
Off-street parking also helps, especially if you have access to a lock-up garage. Some Moscow residents have taken to securing their cars in 'clams', lockable steel shells which completely enclose the vehicle. Steering wheel locks and ignition blockers are also advisable, though should be used with caution. In particular, car immobilisers can be dangerous in carjacking situations, where any obstacle to a smooth holdup can prompt already nervous criminals to start shooting or become otherwise violent. Doing your best to foil the criminal while your car is parked is one thing. When your own safety is at risk, 'determined cowardice' is the best policy.
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