The Tire Warehouse
A large investigative firm asked me to look into thefts from the tire warehouse of a national wholesale tire chain in Hialeah, which is in the north end of Miami, FL. The company management used the term “shrinkage” to describe their problem. I told them shrinkage is when a drugstore employee steals a package of M&Ms, not when over 100 tires are stolen from a warehouse.
In the first interviews I learned from office personnel that their other warehouses across the country also had theft problems, but they were all run-of-the-mill break-ins on weekends and evenings, quite intermittent. In Hialeah, where they had a good security system for nights and weekends, there had been no evidence of any break-ins. But when an order was to be filled with tires from a certain shelf, and the computerized inventory records indicated 28 tires were there, the shelf was completely bare. It was then they realized they had a problem. A comprehensive inventory revealed the total number of tires missing, and the dollar value of the merchandise, was staggering. For months and months, it seemed, they had been losing scores of tires every week.
A dozen office workers at every level were interviewed, followed by the thirteen warehouse workers and drivers. No one knew anything about it, nor had they seen anything suspicious. A tour of the facility showed exactly how they performed their jobs. The purchase orders come on a clipboard from the office to be filled. Could an office worker completely fabricate an order form? Maybe, but there were so many checks in the system that if one piece of paper generated an order, another half-a-dozen related papers backed up the order as from a “real” customer, so fabricated paperwork wasn’t the problem. As for the delivery trucks, they had GPS units to track their movements, and not one had ever gone off-route where tires might be delivered to a location not on a driver’s schedule. So how was someone absconding with a mountain of tires?
The warehouse is a cavernous place with over five-million tires stacked on massive shelves from the floor to a very high ceiling. It takes five workers to fill an order. A warehouse supervisor holds the clipboard with the purchase orders and tells the “picker” what he needs. The cherry-picker is its own vehicle with an elbow of two long beams which raises the man up awfully high to the shelf with the desired tires. He pulls them off, then lowers himself and the tires to the floor. A “runner” puts the tires on a kind of golf cart with a trailer towed behind it, and drives the tires to the loading dock. A “loader” and the driver remove the tires and stack them at the back of the loading area. While the driver returns further to assist the picker, the loader lays one tire on the floor near the pile of tires. He takes a second one, raises it over his shoulder, and then slams it down, round part first, on the outer edge of the prone tire. This causes the thrown tire to take off with significant velocity and roll in the direction of the truck, which is backed up perfectly to the loading dock. There, a “driver” snags the rolling tire deep in the truck and begins to lay a row of tires far in the back, right behind the cab.
He does not stack the tires in columns, but rather “laces” them, with the first one prone, in the back left corner. Then he puts the next one down to the right, only partially overlapping the first, at about a 30° angle, with the right side of the tire on the floor of the truck. The next tire goes in the same way, until the row reaches the right corner. The next layer comes back, right to left, again lacing them, not quite like bricks, but this method uses much less space than tires stacked in columns. Also, when woven this way, they won’t shift when the truck turns.
By the time the driver has the first set of tires laces together, he turns around and more tires are rolling toward him, one at a time, for more lacing. He loads the tires to the roof of the truck and begins a new row, lower left, so a truck, fully packed, holds several hundred tires. But where in this system could they be losing tires, and how could anyone be stealing so many of them? I thought they might have been stolen in sets, four at a time, but that would mean a lot of individual thefts, and there was no indication that one warehouseman, or a couple together, could carry this off without others knowing. You really couldn’t just take them out of the warehouse and put them in the trunk and backseat of your car when you went home each night.
In touring the warehouse, I noticed they had security cameras. But the ones most relevant to this investigation, those aiming at the loading dock, had columns of tires piled as many as seventeen high, with the top one blocking the camera’s view. This was so with every loading dock camera.
Throughout the interview process, which took place in both English and Spanish, some of the workers were assessed as more friendly, and some of their anecdotes reflected solid family values. This indicated a higher level of honesty to me—something difficult to fake or plant into their interviews. A couple of these workers were “taken into confidence,” and asked to look carefully as they went about their jobs. Anything that stood out as an anomaly from normal operations was of interest to me.
Several days after the interviews were completed and mostly written up, but, as of yet, without a conclusion, a phone call was received from one of these “sources” around 9 AM. A driver, who had pulled his truck off the road after going only a few blocks from the warehouse, was both excited and afraid. I told him to wait for me to join him.
His story was that he had a doctor’s appointment that morning and took sick leave from work. But when he arrived for the appointment, the doctor had also called in sick, so the driver went right over to the warehouse. His truck was already partially loaded, so he took over for his replacement driver. There were already 28 tires laced into the back of the truck, but not one purchase order had been checked off. That is, these tires had no destination.
Instead of raising an alarm with the other workers, he simply loaded the rest of the truck and drove off, stopping to call me a few blocks away. After I arrived, I had him drive the truck back to the loading dock, where it was unloaded. Each purchase order was checked against the tires coming off the truck. There was no mistake. An extra 28 tires were on the truck.
This caused another round of interviews, and a curious thing happened. I specifically asked each of the five involved in loading the truck where they had come from. Note that everyone in the warehouse was Hispanic, and Spanish was the only language used there. The thirteen warehousemen and drivers were from several different countries, Nicaragua, Peru, Panama, Mexico, and the Dominican Republic, but most of them, the other eight, were ethnic Cubans. Of those interviewed on this second go-around, not my source, but all of the other five in the chain of loading the tires, were Cuban. And then the picture began to come into focus.
I picked the one who had a nice family, owned his little house, not an apartment, and looked like he had the most to lose if he lost his job. I asked him to tell me what was going on. At first he denied anything was, as they all had before. But I told him a criminal indictment for what he was doing would be a bad thing unless he didn’t mind his children visiting him in jail as they grew up. I also told him that his house was much too nice to have been bought on his $12-an-hour warehouse salary. Then he began to make excuses. His wife inherited money, she had a good job, he worked two jobs, etc. I told him I would look into every minute detail of his life and follow the trail of money which bought his house. Soon, thereafter, he “collapsed,” and laid it all out.
Whenever the five-man crew—the clipboard man, picker, runner, loader, and driver— were all Cubans, with a “wink and a nod,” they automatically laced an extra set of tires in the truck, always the first ones in. Later, they would be offloaded last.
The driver takes the route set out by the purchase orders, delivering all of the bona fide ones. Within a few blocks of arriving back at the warehouse, the truck would stop a few cars back from a traffic signal and put on its emergency blinkers. Two pickup trucks would pull up behind the tire truck, and four men would quickly unload all of the then-stolen tires into the pickups. The light would have changed only twice by the time the truck pulled out again, and this slight delay would not raise any suspicions because there had been no deviation in the truck’s route.
Asked about who the off-loaders were, the man merely referred to them as “amigos de la calle,” that is, friends from the street. With the degree to which this was organized, it may well have been that he did not know their identities, but they were part of a much larger ring conducting massive theft operations. Of course, someone in the warehouse had to make a key call to alert an outside man and arrange for the pickup trucks to be waiting at the intersection.
The “bigger picture” here is actually much more interesting, and it came from some cases worked before this one, and many which came after it, including one with theft at a warehouse near a cemetery. It goes back to 1959, when the “good” Cubans deserted—most would say “escaped”—Fidel Castro’s Communist revolution, tens of thousands of whom came to the U.S. They were the doctors, lawyers, businessmen, architects, pharmacists, almost anyone who had a decent job and some moral standards. They made their way in Miami and after years, changed much of south Florida in a productive way.
But toward the end of President Jimmy Carter’s tenure in office in 1979, he pleaded with Castro to let more people out, which he finally did over several months in 1980. The Miami Cubans wanted their relatives to join them in the “Land of the Free.” But instead of letting out their brothers and cousins, Castro opened the doors of his jails and mental institutions and lined these people up on the docks at Mariel Bay. When the Miami yachts and sport-fishing boats came to pick up relatives, the Cuban military had their Kalashnikov’s pointed at the Americans and commanded them to accept those who were on the docks. When these “Mariel boat-lift” people arrived, they were the dregs of 20 years of the Communist Cuban debacle, and now became a blight on America. Also, most of them also moved to Hialeah.
Over the years the amount and level of organized crime emanating from Hialeah and these thousands of “Marielitos” would touch, not just all of Florida and the eastern United States, but it also spread to other parts of the country. No longer could the “five Mafia families” of New York claim to be at the top of the criminal pyramid in the US, because they had been eclipsed by Cuban organized crime in Hialeah. So if you want to know who would have the ability to “move” over a hundred stolen tires a week, meaning thousands over a year, and have the participants within the warehouse not be aware of who was off-loading the tires a few blocks away, it was simply part of great crime wave. I told the tire wholesaler company that they could not fight this greater corruption, but they could keep their own warehouse “safer.”
In any internal fraud matter, the issues are two, for what the owners want to do: (1) Catch the bad guys, (2) Stop the bleeding. Here, they knew who the bad guys were, essentially, every ethnic Cuban in their warehouse. But they did not want to fire them all, on a wholesale basis. (Actually, they feared one of them would burn the warehouse to the ground.) So besides tighter controls on everything, I suggested they implement two actions. First, mandate that the loading dock cameras never be blocked again, (and that they be monitored), and second, never again have all five workers loading a truck be Cuban—make that a maximum of three. That worked for them. It really only meant that Cuban organized crime would just target another warehouse which had fewer security precautions, but the client was very satisfied with the analysis and the results. And, of course, about having built their new five-million-tire warehouse in Hialeah? If they knew then what they know now…
In the first interviews I learned from office personnel that their other warehouses across the country also had theft problems, but they were all run-of-the-mill break-ins on weekends and evenings, quite intermittent. In Hialeah, where they had a good security system for nights and weekends, there had been no evidence of any break-ins. But when an order was to be filled with tires from a certain shelf, and the computerized inventory records indicated 28 tires were there, the shelf was completely bare. It was then they realized they had a problem. A comprehensive inventory revealed the total number of tires missing, and the dollar value of the merchandise, was staggering. For months and months, it seemed, they had been losing scores of tires every week.
A dozen office workers at every level were interviewed, followed by the thirteen warehouse workers and drivers. No one knew anything about it, nor had they seen anything suspicious. A tour of the facility showed exactly how they performed their jobs. The purchase orders come on a clipboard from the office to be filled. Could an office worker completely fabricate an order form? Maybe, but there were so many checks in the system that if one piece of paper generated an order, another half-a-dozen related papers backed up the order as from a “real” customer, so fabricated paperwork wasn’t the problem. As for the delivery trucks, they had GPS units to track their movements, and not one had ever gone off-route where tires might be delivered to a location not on a driver’s schedule. So how was someone absconding with a mountain of tires?
The warehouse is a cavernous place with over five-million tires stacked on massive shelves from the floor to a very high ceiling. It takes five workers to fill an order. A warehouse supervisor holds the clipboard with the purchase orders and tells the “picker” what he needs. The cherry-picker is its own vehicle with an elbow of two long beams which raises the man up awfully high to the shelf with the desired tires. He pulls them off, then lowers himself and the tires to the floor. A “runner” puts the tires on a kind of golf cart with a trailer towed behind it, and drives the tires to the loading dock. A “loader” and the driver remove the tires and stack them at the back of the loading area. While the driver returns further to assist the picker, the loader lays one tire on the floor near the pile of tires. He takes a second one, raises it over his shoulder, and then slams it down, round part first, on the outer edge of the prone tire. This causes the thrown tire to take off with significant velocity and roll in the direction of the truck, which is backed up perfectly to the loading dock. There, a “driver” snags the rolling tire deep in the truck and begins to lay a row of tires far in the back, right behind the cab.
He does not stack the tires in columns, but rather “laces” them, with the first one prone, in the back left corner. Then he puts the next one down to the right, only partially overlapping the first, at about a 30° angle, with the right side of the tire on the floor of the truck. The next tire goes in the same way, until the row reaches the right corner. The next layer comes back, right to left, again lacing them, not quite like bricks, but this method uses much less space than tires stacked in columns. Also, when woven this way, they won’t shift when the truck turns.
By the time the driver has the first set of tires laces together, he turns around and more tires are rolling toward him, one at a time, for more lacing. He loads the tires to the roof of the truck and begins a new row, lower left, so a truck, fully packed, holds several hundred tires. But where in this system could they be losing tires, and how could anyone be stealing so many of them? I thought they might have been stolen in sets, four at a time, but that would mean a lot of individual thefts, and there was no indication that one warehouseman, or a couple together, could carry this off without others knowing. You really couldn’t just take them out of the warehouse and put them in the trunk and backseat of your car when you went home each night.
In touring the warehouse, I noticed they had security cameras. But the ones most relevant to this investigation, those aiming at the loading dock, had columns of tires piled as many as seventeen high, with the top one blocking the camera’s view. This was so with every loading dock camera.
Throughout the interview process, which took place in both English and Spanish, some of the workers were assessed as more friendly, and some of their anecdotes reflected solid family values. This indicated a higher level of honesty to me—something difficult to fake or plant into their interviews. A couple of these workers were “taken into confidence,” and asked to look carefully as they went about their jobs. Anything that stood out as an anomaly from normal operations was of interest to me.
Several days after the interviews were completed and mostly written up, but, as of yet, without a conclusion, a phone call was received from one of these “sources” around 9 AM. A driver, who had pulled his truck off the road after going only a few blocks from the warehouse, was both excited and afraid. I told him to wait for me to join him.
His story was that he had a doctor’s appointment that morning and took sick leave from work. But when he arrived for the appointment, the doctor had also called in sick, so the driver went right over to the warehouse. His truck was already partially loaded, so he took over for his replacement driver. There were already 28 tires laced into the back of the truck, but not one purchase order had been checked off. That is, these tires had no destination.
Instead of raising an alarm with the other workers, he simply loaded the rest of the truck and drove off, stopping to call me a few blocks away. After I arrived, I had him drive the truck back to the loading dock, where it was unloaded. Each purchase order was checked against the tires coming off the truck. There was no mistake. An extra 28 tires were on the truck.
This caused another round of interviews, and a curious thing happened. I specifically asked each of the five involved in loading the truck where they had come from. Note that everyone in the warehouse was Hispanic, and Spanish was the only language used there. The thirteen warehousemen and drivers were from several different countries, Nicaragua, Peru, Panama, Mexico, and the Dominican Republic, but most of them, the other eight, were ethnic Cubans. Of those interviewed on this second go-around, not my source, but all of the other five in the chain of loading the tires, were Cuban. And then the picture began to come into focus.
I picked the one who had a nice family, owned his little house, not an apartment, and looked like he had the most to lose if he lost his job. I asked him to tell me what was going on. At first he denied anything was, as they all had before. But I told him a criminal indictment for what he was doing would be a bad thing unless he didn’t mind his children visiting him in jail as they grew up. I also told him that his house was much too nice to have been bought on his $12-an-hour warehouse salary. Then he began to make excuses. His wife inherited money, she had a good job, he worked two jobs, etc. I told him I would look into every minute detail of his life and follow the trail of money which bought his house. Soon, thereafter, he “collapsed,” and laid it all out.
Whenever the five-man crew—the clipboard man, picker, runner, loader, and driver— were all Cubans, with a “wink and a nod,” they automatically laced an extra set of tires in the truck, always the first ones in. Later, they would be offloaded last.
The driver takes the route set out by the purchase orders, delivering all of the bona fide ones. Within a few blocks of arriving back at the warehouse, the truck would stop a few cars back from a traffic signal and put on its emergency blinkers. Two pickup trucks would pull up behind the tire truck, and four men would quickly unload all of the then-stolen tires into the pickups. The light would have changed only twice by the time the truck pulled out again, and this slight delay would not raise any suspicions because there had been no deviation in the truck’s route.
Asked about who the off-loaders were, the man merely referred to them as “amigos de la calle,” that is, friends from the street. With the degree to which this was organized, it may well have been that he did not know their identities, but they were part of a much larger ring conducting massive theft operations. Of course, someone in the warehouse had to make a key call to alert an outside man and arrange for the pickup trucks to be waiting at the intersection.
The “bigger picture” here is actually much more interesting, and it came from some cases worked before this one, and many which came after it, including one with theft at a warehouse near a cemetery. It goes back to 1959, when the “good” Cubans deserted—most would say “escaped”—Fidel Castro’s Communist revolution, tens of thousands of whom came to the U.S. They were the doctors, lawyers, businessmen, architects, pharmacists, almost anyone who had a decent job and some moral standards. They made their way in Miami and after years, changed much of south Florida in a productive way.
But toward the end of President Jimmy Carter’s tenure in office in 1979, he pleaded with Castro to let more people out, which he finally did over several months in 1980. The Miami Cubans wanted their relatives to join them in the “Land of the Free.” But instead of letting out their brothers and cousins, Castro opened the doors of his jails and mental institutions and lined these people up on the docks at Mariel Bay. When the Miami yachts and sport-fishing boats came to pick up relatives, the Cuban military had their Kalashnikov’s pointed at the Americans and commanded them to accept those who were on the docks. When these “Mariel boat-lift” people arrived, they were the dregs of 20 years of the Communist Cuban debacle, and now became a blight on America. Also, most of them also moved to Hialeah.
Over the years the amount and level of organized crime emanating from Hialeah and these thousands of “Marielitos” would touch, not just all of Florida and the eastern United States, but it also spread to other parts of the country. No longer could the “five Mafia families” of New York claim to be at the top of the criminal pyramid in the US, because they had been eclipsed by Cuban organized crime in Hialeah. So if you want to know who would have the ability to “move” over a hundred stolen tires a week, meaning thousands over a year, and have the participants within the warehouse not be aware of who was off-loading the tires a few blocks away, it was simply part of great crime wave. I told the tire wholesaler company that they could not fight this greater corruption, but they could keep their own warehouse “safer.”
In any internal fraud matter, the issues are two, for what the owners want to do: (1) Catch the bad guys, (2) Stop the bleeding. Here, they knew who the bad guys were, essentially, every ethnic Cuban in their warehouse. But they did not want to fire them all, on a wholesale basis. (Actually, they feared one of them would burn the warehouse to the ground.) So besides tighter controls on everything, I suggested they implement two actions. First, mandate that the loading dock cameras never be blocked again, (and that they be monitored), and second, never again have all five workers loading a truck be Cuban—make that a maximum of three. That worked for them. It really only meant that Cuban organized crime would just target another warehouse which had fewer security precautions, but the client was very satisfied with the analysis and the results. And, of course, about having built their new five-million-tire warehouse in Hialeah? If they knew then what they know now…