Alyn Halstrum shut out the lights, locked the doors, armed the alarm system and went home, confident of the measures he took to secure his property.
But the perpetrators were one step ahead of him. Having scoped the facility days before, they came back that night, cut a hole through a chain link fence above the wall surrounding the facility and climbed through it to get into the storage yard. With bolt cutters, they cut the locks from a storage unit and loaded a dump truck; also stolen from him, with various light construction equipment. In a matter of hours, valuable rental equipment — $135,000 worth — accumulated over the years, the lifeblood of the family-owned company, was gone without a trace.
“I think they cased the place out three to four days before the burglary,” says Halstrum, owner of Rent-A-Tool in Monterey Park, Calif. “I saw two people walk into the yard and when I approached them, they said they were just checking out prices. But they never asked anyone from the staff about prices.
“They took plumbing snakes, generators, hand electric tools, saws, all totaling about $135,000. The only thing I recovered was my dump truck. A private party phoned me about three weeks later about a missing dump truck found in a strip mall in Downey, about 15 miles away.”
Equipment theft is quickly becoming a national crisis, accounting for more than $1 billion worth of construction equipment and vehicles lost each year, according to the National Insurance Crime Bureau. Plus, an average of 200 pieces of equipment are stolen each week, based on John Deere reports.
The most frequently stolen items are electric hand tools, generators, concrete breakers, plumbing snakes, hammers, welders and air compressors; generally light construction equipment that can be easily shipped and sold out of the country. However, heavy machinery is becoming susceptible to theft in recent years because, according to FBI reports, heavy machinery such as bulldozers and backhoe loaders fetch a high resale price on the open and black market.
Everyone, even the most heavily guarded center, is at risk.
A huge smuggling ring targeted rental centers, including Rent-A-Tool, in the Los Angeles and Inland Empire counties between October 1999 and December 2000. According to Carol Murphy, spokeswoman for the Rental Industry Association's Security Alert Program, the tool bandits walked away with a total of $670,000 in stolen equipment during this period.
“It was pretty bad. The average loss for a center was $40,000,” Murphy says. The Alert program helps its members identify and recover stolen equipment by faxing an incident report to them and law enforcement agencies as soon as a theft occurs.
One of the first victims during this crime spree was Joe Wiest, president of Wiest Rentals in Riverside, Calif. In December 1999, thieves broke into his rental center through an unprotected fence area, sliced a hole through a wall furthest from the motion detector and loaded up a truck with 30 to 40 pieces of equipment worth about $40,000.
“You almost swore they were setting up another center because they took saws, airless paint sprayers, hammers and other small equipment stored in the building,” Wiest says. “You wonder whether it was an inside deal because they seemed to know where to come into the building. But here you have so many customers walking in and there's no area that's off limits.”
The burglary baffled Wiest, who spends about $40 a month on security devices. He later discovered a faulty motion detector outdoors.
The same smuggling ring is also suspected in the burglary of San Bernardino, Calif.-based Ready Equipment Rental. In April 2000, burglars took about 16 pieces of equipment, mostly sewer snakes, rammers, saws, some compaction equipment and paint sprayers, totaling more than $16,000.
Owner Richard Piehler recalls the break-in: “I have an 8-foot wrought iron fence around the property. They took a section of the fence out and entered through the north side. Then they went over the security laser beam around the yard and came into the backside of the building, where we have two chain gates with steel locks. The [thieves] broke through the locks by using a spray that froze them.
“We're a small rental yard and it takes time to replace the equipment. We average about 30 rentals of sewer snakes a week and they took all my sewer snakes. It really hurt us.”
With equipment thieves becoming more brazen and sophisticated — cutting off wires, leaping over walls and bypassing security beams — rental center owners need to be aggressive about securing their property with locks, monitoring devices, tracking units or a combination of devices.
Locks such as the Pit Bull Tire Lock and the California Immobilizer are ideal for securing small- and heavy-equipment with wheels.
The Pit Bull Tire Lock is a device that attaches to any tire or object with a grip range of up to 16 inches. Consisting of a pair of caliper-type arms made with aluminum alloy and reinforced with ribbed steel rods, the Pit Bull Tire Lock is designed to protect vehicles, construction equipment, trailers and basically “anything with wheels.”
“Because it's made of aluminum alloy and steel, thieves can't torch, freeze or break it,” says Louise Ford, spokeswoman for Pit Bull Tire Lock, Santa Fe, N.M. “The device also can't be opened without a key, which is a circular, push-in type that spins in place to prevent drilling.”
Retailing for $350, the Pit Bull Tire Lock is perfect for use in construction sites, a hotbed for equipment thieves.
Jason File, treasurer of Les File Drywall Company in Albuquerque, N.M., finds the Pit Bull Tire Lock a timesaver. Before purchasing the device, his crew would remove wheels from trailer vehicles, welders and cement mixers to immobilize them.
“But that was too time consuming,” File says. “With the Pit Bull, they can put it on in seconds.”
The California Immobilizer works similarly. Weighing less than 28 pounds, the steel-constructed device covers a vehicle's lug nuts, securing the wheel. Retailing for about $175, the lock can be used on any wheeled rental equipment, trailers and vehicles.
“There is no need to remove wheels, store wheels or use a jack,” says Gerald Mason, president of the Palmdale, Calif.-based company. “It is made of steel and it could be cut off, but you are going to have to work at it. It is also highly visible, so it will slow down the process of theft.”
The unit also has a long shelf life, Mason says, because “there's only one moving part that requires very little maintenance.”
For an extra pair of eyes and ears watching over your business 24/7, consider video surveillance and access control systems, designed to safeguard against unauthorized entry, shop-lifting, employee theft and false accident claims.
Randy Dunn, product manager for Boca Raton, Fla.-based ADT Security Services, recommends installing closed-circuit television, such as the company's Spectra II Series surveillance dome, in a visible area. He says it is a high-performance camera and optics package, with full pan/tilt positioning mechanism in an attractive dome that can seamlessly track moving objects.
“CCTV has a strong effect on people because they know that it records everything,” Dunn says. “It helps keep honest people honest.”
ADT also offers covert, more expensive cameras for use indoors and outdoors, ranging in price from around $600 to $1,000 per unit.
Dunn also recommends the Focus 200 Plus system, a basic alarm system that monitors fire, theft and intrusion. He says a “nice system costs a couple thousand dollars” plus about $30 a month monitoring cost.
“If all you need is a real basic system, with sensors that monitor your building at all times, this is it,” he says. “The system can send out a silent alarm or it can have big flashing lights or little chirps when it goes off. The signal goes to our monitoring system, which [notifies police.]”
After a burglary, a tracking device such as LoJack might be your best chance of recovering your equipment. Manufactured in Dedham, Mass., the LoJack unit is a small transmitter hidden in one of up to 20 possible recesses in the equipment's interior. Neither the dealer nor the purchaser knows where it is hidden. When equipment is reported stolen, police activate the LoJack unit in the stolen equipment, which then emits an inaudible radio signal. LoJack's tracking computers installed in law enforcement vehicles enable officers to follow the signal and in many cases, locate the equipment.
“All equipment is at risk, large and small,” says Katherine Slather, national sales manager for LoJack's commercial division. “You see a lot of equipment offsite and most have no license plates, so they're hard to track down. It's also very easy for anyone to drive off with equipment on the road because one key can fit the same types of equipment. That's why it is so important to protect your equipment.”
Retailing at $695, the LoJack unit can be used by commercial and industrial fleet operators and consumers. For heavy machinery, a more rugged version is available, which is essentially the same unit encased in a hardened aluminum housing, coated in rubber for protection and bolted to the equipment.
‘All equipment is at risk, large and small. You see a lot of equipment offsite and most have no license plates, so they're hard to track down. It's also very easy for anyone to drive off with equipment on the road because one key can fit the same types of equipment. That's why it is so important to protect your equipment.’
— Katherine Slather LoJack national sales manager
The LoJack unit is no stranger to professional thieves, whom Slather says will usually leave a stolen vehicle for a day or less to see if the police show up. If the equipment is not reclaimed, the thief usually takes it to a local “chop shop,” a garage where stolen vehicles are dismantled so that parts can be sold separately, or to a shipping dock.
“We've found that LoJack is well-known in the market,” she says. “They don't want the stolen equipment to lead the police to them, so many times they will wait. This is when most of the recoveries happen.”
Slather says more than 90 percent of vehicles and equipment equipped with LoJack are recovered. By comparison, only 67 percent of all stolen vehicles were recovered, according to the FBI's Uniform Crime Report Statistics 1999.
Also, damage to LoJack-equipped vehicles runs about $1,000, approximately one-fifth of the damage sustained by recovered vehicles without LoJack transmitters. The Highway Loss Data Institute, Arlington, Va. estimates damage to all cars recovered nationwide at more than $5,000.
“The unit is really worth it,” Slather adds. “For $695, you're going to protect equipment that costs a lot more.”
Be a vigilante
Common sense is still your first line of defense against equipment theft. When electronic monitoring devices and security beams fail, as they sometimes do, the preventive measures you take can mean the difference between being victimized or not.
Make your rental facility thief-proof by keeping it neat, organized and well lit. If everything is in place, missing items will stand out. Also, post signs that say shoplifters will be prosecuted.
RIA's Murphy suggests being aware of who walks into your center at all times, noting customers' description and vehicle license number if possible. “Some of them send out clean-cut looking guys to scope out the center,” she warns. “Be really careful who you let in.”
For easier recovery, keep a complete and updated list of all your equipment, including its make, model and serial number. Halstrum of Rent-A-Tool also places identifying stickers and has his drivers license number pencil-engraved and welded on each piece of equipment. Also, because some thieves weld off serial numbers, some owners mark their equipment, by placing stickers or chipping grooves in hidden places, as a way of identifying them.
The best deterrent, Halstrum adds, is telling “everyone around you to report any suspicious activity.” “That means your neighbors, the police and the other businesses in the area. Make your local police department increase their drive-bys and to do them at different times. I even gave my neighbors the police dispatch number. Get the word out about the burglaries, that's the best advice I can give you.”
Are you covered?
Joe Wiest says if you don't spend money on electronic security systems, be prepared to spend it on insurance.
He should know. When Wiest Rentals was burglarized, he didn't have any insurance to cover the loss and was basically out $40,000.
“Now we have an ‘equipment floater policy which covers equipment loss because I'm afraid the thieves are going to hit us again,” he says.
Make sure you know what is and what isn't covered in your equipment floater policy. Jim Bankson, executive vice president of USI Rental Specialties in Irvine, Calif., recommends owners look for a “replacement cost” endorsement, which offers the broadest coverage and will pay you the equipment's current value.
“With replacement cost coverage, you will receive new property of similar kind and quality to replace what you lose or is damaged,” Bankson says. “You also want to make sure the policy includes coverage for conversion or ‘theft under contract.’ Conversion means taking the property of others and converting it to their own use. In other words, the owner has rented the equipment to someone who never plans to return it.”
David Duvall, vice president of Jenkins/Athens Insurance Services in Concord, Calif., suggests owners ask about a policy under a “group program,” such as the one they offer to RIA members.
“A group program gives you a better chance of being renewed after a loss,” he says.
Halstrum of Rent-A-Tool had a rude awakening the day after the burglary. He discovered that he didn't have a replacement cost policy and instead, had bought a “depreciated value policy minus the deductible.” So his insurance company at the time figured he would recover only about $50,000, or about 40 to 50 cents on the dollar.
‘Make your local police department increase their drive-bys and do them at different times. I even gave my neighbors the police dispatch number. Get the word out about the burglaries, that's the best advice I can give you.’
— Alyn Halstrum owner, Rent-A-Tool
— Katherine Slather
“I was able to eliminate the depreciation schedule, which helped because I wound up getting 60 to 70 cents to a dollar,” he says. “I had to spend a lot of late nights gathering information for the insurance company, but I kept a good inventory of my fleet and all the refurbishing done on the equipment. But I was still out $55,000.”
To keep unwanted persons from your property:
Block pathways to popular theft targets with hard-to-move equipment.
Use bolt-cutter-resistant padlocks.
Check fences regularly for holes.
Bring display equipment indoors or into a fenced area at night.
Chain small equipment through heavy equipment at night.
Install a good alarm system that monitors motion and broken glass.
Have your alarm system checked and maintained regularly.
Put bars on windows.
Install floodlights around the building.
Trust your instincts. Be aware of doors that have been “disturbed,” items mysteriously moved overnight and footprints in the back of the facility.
Types of theft:
Equipment can be stolen three ways. Here's how to protect your investment.
Theft from premises. Easily prevented by installing alarm systems, fencing your yard, outdoor lighting, wheel locks and satellite tracking for large equipment. Guard dogs can be problematic, they can be poisoned or let loose.
Theft from job site. Avoid this by advising your customers to park equipment in lighted areas and close to other equipment. Advise them not to move equipment without written permission and to not leave keys in the equipment unattended.
Theft by conversion. When a customer fails to return equipment, make sure you can prove criminal intent. Prevent this type of theft by calling the customer the day after the equipment is due, checking the job site, calling the police and placing the information on local theft alert.
Information provided by Mike Martinie, director of marketing, American Rental Association Insurance Services.