C-TPAT: What Every Security Executive Should Know

Transcription

1 C-TPAT: What Every Security Executive Should Know Barry Brandman President Danbee Investigations Fair Lawn, NJ SPONSOR LOGO C-TPAT: What Every Security Executive Should Know In this session, you will learn: How to Mitigate the Risk of a Supply Chain Security Breach The Essential Components of a World Class Supply Chain Security Program Effectively Dealing with Security Threats in High Risk Countries What Changes with the C-TPAT Program You Can Expect to See in the Future 1

2 Mitigating the Risk of a Supply Chain Security Breach that Could Jeopardize Your C-TPAT Certification Most Breaches Occur Before the Shipments Arrive to the U.S. Which is Why Finding Out How Your Supply Chain is ReallyBeing Protected by Separating Fact from Fiction is Critical Separating Fact from Fiction: The First Step Towards Strengthening a Supply Chain Security Program Most security programs look much better on paper than they actually work. The difference between cosmetic and meaningful safeguards is not always obvious. Those companies that have failed to expose these differences have been victimized 8-10 times more frequently than those that proactively identify and remedy their deficiencies. 2

3 Case History Security Questionnaire Responses from a Victimized Foreign Freight Forwarder 1. Their security seals were always tightly controlled for exports sent to the U.S. 2. Their 7 point container inspections were thoroughly performed 3. Their facility security had been independently inspected and rated as very satisfactory 4. They maintained strong security controls of trucks transporting U.S. exports from their facility to the air local terminal. Reality vs. the Freight Forwarder s Response: Their security seals were tightly controlled How It Actually Worked: Their seals were kept in an unlocked drawer in the shipping office so any dock worker had access to them Several times each week the seals were being affixed by anyone working on the dock, not just designated personnel On busy days, even drivers were handed security seals and allowed to affix them to their trucks and containers. 3

4 Reality vs. the Freight Forwarder s Response: Their 7 point container/trailer inspections were being thoroughly performed How It Actually Worked: No meaningful training was provided to the personnel responsible for conducting the inspections Poor lighting inside the terminal made it nearly impossible to see anything concealed inside or to the undercarriage of a container/trailer No one knew what constituted suspicious measurements from the laser range finder Reality vs. the Freight Forwarder s Response: Their facility scored high on an independently conducted security audit How It Actually Worked: The contracted company that performed their security audit simply used a generic checklist that overlooked several critical areas Upon completion of the audit, the forwarder received a bogus official C-TPAT certificate (and a healthy invoice for professional C-TPAT certification services) 4

5 Reality vs. the Freight Forwarder s Response: They maintained strong security controls of trucks transporting exports to the air terminal How It Actually Worked: Although truck cargo doors were padlocked, drivers were provided withakey The GPS devices only provided updates every 60 minutes and were not embedded in the trucks, thereby allowing drivers to easily circumvent them two different ways The Essential Components of a World Class Supply Chain Security Program 1. Establish a Culture of Security Excellence 2. Design Your Program with Multiple Checks and Balances 3. Strategically Utilize the Right Technology 4. Relentlessly Audit Your Safeguards to Expose Weaknesses 5

6 Establishing a Culture of Security Excellence Good enough should never be good enough If you are C-TPAT certified, don t simply meet C-TPAT minimum standards. Exceed them wherever possible. Adopt a Proactive Mindset If you re not finding weaknesses in your supply chain security program each year, you re probably not looking hard enough Designing Checks and Balances Throughout Your Supply Chain Anticipate that your first line of defense will fail! There have been over 3400 companies suspended and/or expelled from the C-TPAT program for serious violations found during a validation or as a result of a significant security breach! This number will continue to rise. 6

7 Strategically Utilizing Security Technology One example: Concealed GPS in cargo or vehicles traveling through high risk areas Strategically Utilizing Security Technology Protecting loose cargo with tamper evident, pre-numbered security tape, bands and pallet seals 7

8 Strategically Utilizing Security Technology Remote Video Monitoring Audits for Tighter Control Over Security Sensitive Areas and Activities Relentlessly Audit Every Component of Your SC Security Program to Expose Weaknesses Vulnerabilities Exposed During Foreign Security Audits: Foreign Manufacturers failing to seal containers because they might be opened for foreign Customs inspections Leaving staged export shipments exposed overnight under the control of a security guard Significant 7 Point Inspections failures GPS systems improperly programmed 8

9 Effectively Auditing Your Supply Chain is Essential to Mitigating the Risk of a Breach Going beyond surface level questions will result in a more accurate representation of a company s strengths and weaknesses. Fact:A significant percentage of those conducting these audits have little or no security expertise. Fact:78% of the security breach forensic investigations we have conducted revealed that the victimized company s self-assessments were little more than the pencil-whipping of generic checklists Case History: All security systems in excellent working condition turned out to be solely based on a statement from the GM. An example of what we found after a major security breach at one overseas facility. 9

10 Effectively Dealing with Security Threats in High Risk Countries Primary Risks: Collusion between shipping personnel and truck drivers Collusion between security staff and drivers Driver collusion with organized crime, agreeing to transport contraband outside or inside their vehicles. You could either take the silver or the lead. It s your choice, but you will take one! Corrupt or bogus police/military planting contraband inside a shipment during an inspection stop without the driver s knowledge Successful 10-Point Process for Protecting the Integrity of Truck Shipments from Mexico to the United States 1. The finished goods department is physically segregated and protected by its own robust intrusion detection system Video cameras perpetually monitor and archive all activity in the finished goods department where exports are staged and loaded. Prior to U.S. bound exports being placed onto a truck, the 7-point inspection is performed by logistics and security personnel who, by working side by side, monitor each other s work and verify measurements taken with a laser range finder. 10

11 4. After the truck is completely loaded, the 17-point inspection process is performed by both a driver anda security officer, who monitor each other s work. Each knows to report any negligence or violation to their respective superiors The security seal is affixed by a security officer with the driver always present and witnessing this. Both the 7-point and 17-point inspections are captured by the video system and viewed by a security supervisor for every truck dispatched to the U.S Departing trucks from the complex are periodically subject to unannounced audits after leaving the facility by a site security manager or supervisor. Every truck has embedded GPS that provides continuous tracking throughout the journey to the U.S. Automatic exception alerts and mobile geofencing are programmed in the system (and regularly tested). 9. A security officer is required to live monitor each truck in transit to the U.S. Should any anomaly take place, the guard is required to contact the site security manager immediately. 11

12 The Role of the Security Manager: The security manager is required to regularly review archived GPS reports as well as archived video of the 7-point and 17- point inspection processes. 10. The security manager is required to review archived video of the security officers responsible for live U.S. bound truck monitoring via the GPS system. The security manager is also required to generate a monthly summary report of the results of all these video audits that is reviewed by a superior. What Changes Can You Expect in the Future? The minimum security criteria will be upgraded. Could be the most significant change since the program s inception. Validations will not be as easy to pass as they have been in the past More suspensions and expulsions from the program will take place Additional benefits will be offered to Tier III members, such as SAFETY Act certification (the 2002 Support Anti-Terrorism by Fostering Effective Technologies Act) 12

13 C-TPAT: What Every Security Executive Should Know To recap on today s takeaways... The Essential Components of a World Class Supply Chain Security Program: 1. Establish a Culture of Security Excellence 2. Design Your Program with Multiple Checks and Balances 3. Strategically Utilize the Right Technology 4. Relentlessly Audit Your Safeguards to Expose Weaknesses Questions? C-TPAT: What Every Security Executive Should Know Barry Brandman President Danbee Investigations bbrandman@danbeeinvestigations.com 13

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