Laptop computer thieves running rampant
August 6, 1998
by Kim S. Nash
(IDG) -- Thieves, increasingly working in elaborate rings of robbers, brokers and fences, have left victims bloodied and police frustrated. Cargo theft of laptops -- sometimes at gunpoint -- is on the rise. So is a gentler crime: well-dressed crooks walking into office buildings and walking out unnoticed with unguarded laptops. This escalating crime wave is costing laptop buyers an estimated $150 extra per machine, according to experts tracking the problem.
User companies, some that have been victimized, are taking the crime seriously. A Visa U.S.A., Inc. executive was hospitalized recently when thugs beat him up in a hotel parking lot and took his laptop computer. "We tell our people to ... valet-park now" as a result, said Allen Trosclair, former vice president of security at Visa in Foster City, Calif.
When a laptop is reported stolen at Citicorp, internal security investigates the employee first because so many thefts are inside jobs, said Michael Scialabba, vice president of investigations and fraud prevention at Citicorp in New York.
Arthur Andersen &Co. in Chicago shows new hires a 20-minute video about how to protect against theft and requires all users to cable their laptops to desks while at work. "Once these computers are stolen, we are recovering almost none of them. There are so many opportunities out there to sell them," said Denise Gill, a detective at the Montgomery County Police Department in Bethesda, Md.
Companies insured by Safeware, The Insurance Agency, Inc. in Columbus, Ohio, reported more than $1 billion worth of claims for stolen laptops last year -- a 28% jump from 1996. According to the Technology Theft Prevention Foundation, an average of one laptop per week is stolen from hotels and the convention center in Santa Clara, Calif., a hot spot for industry conferences.
It's hard to know the full extent of the crime because many thefts go unreported. Plus, most police departments lump theft of laptops in with other stolen-property crimes. But interviews with police, industry groups and security officers at user companies reveal an ugly picture.
Recent incidents include the following:
But a recent six-week string of office thefts in Calgary was quite different.
In that case, 81 laptops were stolen from several buildings in a five-block area. Four thieves would enter a building at lunchtime, dressed in suits and looking for unattended laptops to stuff into briefcases. "These individuals were bold. They would go out the back stairwell, dump them and go get more," Malchow said.
Undercover officers eventually learned how well-planned the operation was. The four "seeds" would meet each morning at a nearby restaurant to chart the day's heists with two men who fenced the stolen goods to buyers. They would regroup in the afternoon to exchange PCs for cash. An Intel Pentium-based machine brought a thief up to $500, Malchow said. He and his team ultimately recovered $60,000 to $70,000 worth of the stolen computers -- some in the back seat of a stolen car -- and made four arrests.
California passed laws recently that make it a crime to buy computers the buyer knew or should have known were stolen.
"Look, if you receive an NEC laptop with 2G bytes of memory and a CD-ROM drive for $400 when it should go for $2,000 to $3,000, you're subject to consequences, such as going to jail," said Lt. Steve Ronco at the San Jose Police Department in California.
"We had to [pass the law] because of the enormity of what we're facing," said Ronco, who leads the High Tech Crime Unit at the department.
Police want help
Police are frustrated with victim companies that don't provide helpful information such as serial numbers or that let the trail go cold by not reporting the crime right away. Another obstacle is laptop makers that won't take extra pains to deter theft by, for example, shipping their products in plain, unmarked packages or etching serial numbers in several places on the machines and components. Used-computer broker Robert Zises has tried to persuade hardware companies to cooperate, with little luck.
"They look at it like it's one more operation they would have to do that consumers probably wouldn't pay extra for," said Zises, who created the Stolen Computer Registry database (www.nacomex.com).
But buyers are paying extra whether they know it or not. That is mainly because cargo theft has increased substantially in the past few years, said Marylu Korkuch, a technology insurance expert at Chubb & Son, Inc. in Washington. Hardware makers hit by truck heists face those losses as well as the cost of shoring up security afterward. Sometimes, as in an incident in Irvine, Calif., last year, the firms must pay medical bills for drivers hurt by thieves.
As a result, the price of an average laptop is inflated by about $150, Korkuch said. "All those costs find their way back to the consumer."
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