Probationary status

As the price of copper soared from 2006 to 2013, the prevalence of metals theft from construction and demolition sites—as well as from abandoned and even occupied buildings—reached epidemic proportions in the United States.

Property owners, contractors, utility companies and other victims of rampant metals theft soon helped push for a wave of municipal and state laws designed to crack down on the practice.

These laws were not universally supported by the scrap metal industry or some of its customers, who often bore the brunt of copious new amounts of documentation and legal liability.

Statistics are pointing to a decrease in recorded incidents of metals theft, a circumstance likely brought about in part because of the increased attention by legislators and law enforcement agencies. Also helping to abate the metal theft crisis, however, is the drop in the price of metals, and copper in particular.

DOWN FROM THE PEAK

The National Insurance Crime Bureau (NICB), Des Plaines, Illinois, is among the organizations investigating and tracking metals theft throughout the U.S.

In September 2015, the NICB released its report and statistical summary for 2014 that showed a welcome declining trend in metals theft, stating that “insured metal theft claims in 2014 were down 8 percent from 2012 levels.”

The organization, in remarks accompanying the release of the report, pointed first not to legislative policies or law enforcement actions, but rather the declining price of copper. “When the number of metal theft claims per month and monthly average copper prices are compared, the number of claims filed is found to have a statistically significant correlation with the price of copper,” states the NICB.

If that correlation holds true, then later in 2016 when the NICB releases its statistical summary of 2015 metals theft it is likely to reveal another drop in incidents. From January to December 2015, the value of copper declined by more than 20 percent as measured by London Metal Exchange (LME) pricing.

Scrap yards throughout the United States tie their scale prices to LME or Comex primary copper pricing, so stolen copper or brass that eventually makes its way to a scrap yard yielded increasingly smaller payoffs throughout 2015.

As the NICB makes clear, even before copper’s loss in value in 2015, the earlier decline from prior “boom year” pricing was already reducing the incentive for metals theft to some degree.

Even with reduced incentives, however, a sector of criminals who learned their “craft” and formed metals theft habits when copper prices spiked continue to target and steal metal for a living.

In 2014, says the NICB, there were still 12,630 insurance claims filed pertaining to stolen metal, with 98 percent of those involving copper.

As might be expected, states with the highest populations reported the most incidents, although Ohio and Pennsylvania contributed above their expected shares of reported crimes.

In any city or state, vacant structures are a common target, says NICB. “If dwellings remain unoccupied for extended periods of time they become magnets for unlawful behaviors,” says the organization. “Wire stripping is among the activities that are routinely discovered in these locations.”

That circumstance is all too familiar to demolition contractors, who can be victims either while in possession of a building or when they perform a bid estimate and discover a structure bereft of much of its prior metallic content.

UNPLEASANT SITES

Vacant buildings have long represented opportunity to demolition contractors, but unfortunately the soaring value of metals in the early part of the 21st century has created a class of criminals also keenly aware of the “hidden value” of seemingly abandoned structures.

Information gathered by NICB as well as metal theft alerts disseminated by the Washington-based Institute of Scrap Recycling Industries Inc. (ISRI) demonstrate the unfortunate attraction that demolition and construction sites present to this criminal element.

In its 2015 report, the NICB notes, “Thieves [have] stripped sheets of metal from building rooftops, stolen memorial decorations from cemeteries, ripped apart air conditioners for the copper coils within and stripped homes and buildings of wiring and piping.”

The organization adds, “Construction sites are frequent victims because metal is often left on site unguarded and relatively unsecured.”

The ISRI ScrapTheftAlert e-mail notification system has been in place for several years as a way to notify scrap dealers in a given region to be on the lookout for metal items and objects that have been reported stolen.

Research into the system shows the average monthly volume of alerts has declined from its peak in earlier years.

ISRI sent out 15 such e-mails to members of its Northern Ohio Chapter in January of 2013. (At that time, copper was priced at nearly twice its January 2016 value, per the NICB’s earlier point about that correlation.)

In January 2014, ISRI sent out nine such alerts to its Northern Ohio members and 11 such alerts in January 2015. In January 2016, following an entire year of copper losing value, ISRI sent out only three scrap theft alerts to Northern Ohio.

Unfortunately for contractors, building sites remain among the most common targets for the criminals who persist. In early 2016 and late 2015, although there were fewer overall incidents, these were among them:

• construction lighting, halogen lights on tripods and Motorola two-way radios, stolen from a job site in Detroit;
• wire, conduit, stainless steel kitchen sinks and an electric drill taken from a contractor in northeastern Ohio;
• loader buckets and forks stolen in the western suburbs of Cleveland; and
• an electrical panel and copper wire removed from a vacant building in a Cleveland suburb.

ON THE WATCH

Legislative actions from 2006 to 2014 tended to focus on increased documentation by scrap dealers. While this legislation was not always welcome by scrap processors, it has likely proven effective in solving crimes and preventing some of the most blatant “fencing” practices.

Fencing of another sort—creating barriers on job sites for potential criminals—is the focus of much of the theft prevention advice offered by police departments and insurance companies.

Nationwide Insurance offers a lengthy list of recommended metal theft prevention tips for property owners (see the sidebar “Additional site prep” at left).

The insurance firm says criminals have broadened their techniques. “Thieves use a variety of methods to locate and steal metals. Some pose as renovation contractors while stripping copper from vacant homes,” says Nationwide, “[and] a few resourceful criminals have used Google Earth to identify large amounts of metal (such as spools of wire) stored outdoors.”

The declining price of copper may have cooled off some of the theft activity, but contractors will likely have to stay protective of their metal into the foreseeable future.

The author is an editor with the Recycling Today Media Group and can be contacted at btaylor@gie.net.