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Reusable Asset Theft – Growing Problem?

[CRATE] Associated Press

The thefts of crates, like these seen in a New Jersey refrigerated warehouse, have prompted food companies to try to crack down on the bandits.

BALTIMORE, Md.—Private investigator James Rood watched as a rental truck pulled up to a stack of plastic bread trays behind a McDonald’s restaurant.

The truck’s passengers jumped out and loaded hundreds of empty trays into the truck. Mr. Rood called police. Shortly after, officers pulled over the truck and arrested two men and a woman, later charged with felony theft.

Mr. Rood, of J.R. Investigative Services in Maryland, is part of a new effort by food companies to stop the theft of tens of millions of dollars a year in hard plastic—the trays, baskets and crates used to deliver bread, milk and soda to grocery stores and restaurants.

Such thefts have become big business over the past five years as the value of petroleum-derived plastic has climbed along with oil prices. The thieves typically take their loot to recycling centers that shred the plastic and resell it. Prosecutors say bandits collect about eight cents a pound in profits. Recyclers resell it for more than 15 cents a pound to manufacturers.

The costs add up quickly for companies. The bakery industry alone loses at least $75 million a year to tray theft, according to the American Bakers Association. The trade group says bakery-tray purchases over the last five years have tripled—a sign bakeries are losing them faster.

JR Paterakis, vice president and principal at closely held H&S Bakery Inc.—which owned some of the trays stolen behind the Baltimore McDonald’s—said he got fed up when he realized that his company’s tray purchases had tripled in recent years because it was losing so many to thieves. The trays—typically stamped with the owner’s name—cost between $3 and $10.

In May, grocery chain Trader Joe’s, of Monrovia, Calif., reported to the San Bernardino County Sheriff’s Department that it lost some $2.5 million of plastic trays to theft over an 18-month period, according to the sheriff’s office. Trader Joe’s declined to comment.

In Chicago, bakers came together last year to try to stem tray theft by looking out for each other’s property.

In Maryland last year, five people were indicted for allegedly stealing $10 million of plastic containers from businesses including H&S Bakery and Rite-Aid Corp., according to the state attorney’s office for Prince George’s County, Md.

To fight back, companies including H&S Bakery, Coca-Cola Enterprises Inc.—Coca-Cola Co.’s largest U.S. bottler, food company Sara Lee Corp. and Bimbo Bakeries U.S.A. last year formed Combat, or Control of Missing Baskets and Trays. Its initial efforts have been focused in the mid-Atlantic region, but it aims to expand nationally.

In addition to investigating alleged thefts, the group is training employees to guard against theft. It is also lobbying state and federal lawmakers to impose stiffer penalties for such thefts.

“There are huge business disruptions when bakers run out of trays,” said Robb MacKie, president and chief executive of the American Bakers Association, which belongs to Combat.

Some theft rings are organized by criminals with international ties, companies and law-enforcement officials said. Recyclers that buy and resell stolen plastic also have drawn scrutiny.

Mr. Rood spent months watching and videotaping G.E.G. Recycling of Landover, Md. Prosecutors allege that G.E.G earned $443,000 in a seven-month period by selling nearly three million pounds of stolen plastic. Two company owners were recently charged with multiple counts of felony theft. Mr. Rood says the company went out of business this month. A company representative couldn’t be reached for comment.

Sleuthing by Mr. Rood, a retired Baltimore police detective major hired by Combat, has led to the arrests of at least a dozen theft suspects, according to prosecutors and court documents.

As a cop, “I did shootings, robberies, drugs,” said the 60-year-old Mr. Rood, who wears three-piece suits and carries Bushnell binoculars. Now, he said, “I spend every day of the week on plastic.”

Sometimes he will stake out a location for days, snapping photos and jotting down license-plate numbers. He often uses rented or borrowed vehicles so he can’t be easily identified. He also helped assemble a theft-awareness video that has been shared with other Combat companies and law enforcement.

Professional thieves aren’t the only problem. Many companies don’t have a sophisticated system in place to track their trays’ whereabouts. Also, customers of companies that own these trays and baskets also wind up keeping the trays. “The smaller guys kind of feast on the bigger guys who are buying these trays,” said Robert Gonnella, vice president of purchasing at Gonnella Baking Co. in Chicago.

Mr. Paterakis of H&S Bakery recently started sending warning letters to customers saying the trays are H&S property and keeping them is tantamount to theft. He also has enlisted his team of more than 1,000 sales-delivery drivers to report suspicious activities and to capture license-plate numbers and photos when they see anybody misusing the company’s trays.
—Timothy W. Martin and Valerie Bauerlein contributed to this article.

Write to Lauren Etter at

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