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Builders Bulldozed By Thieves

September 3 , 2006

By CHIP JACOBS
Special to the Times

This Labor Day holiday, while Californians gobble hamburgers and hot dogs in a farewell to summer, thieves who prey on housing job sites will be fattening up on Deere and Caterpillars — as in John Deere front-loaders, Caterpillar backhoes and an emporium’s worth of other pricey machinery and materials theirs for the swiping.

Theft has become a chronic, multibillion-dollar drag on the U.S. home-building industry, and three-day weekends when work crews are usually off are among criminals’ favorite times to strike.

These are not grab-and-dash burglaries. Sophisticated and creative, many of today’s crooks run surveillance to gauge when housing work sites are most vulnerable. They know how to disable alarms and equipment kill switches, and how much time they have till police respond, how to steal consumer appliances just after installation, and they’ve been known to impersonate rental company workers.

The black market for construction equipment is well greased and increasingly global.

Machinery stolen from Southern California construction sites has turned up not only in other parts of California and in Mexico but also in Argentina, Brazil, Asia, the Middle East and Eastern Europe, authorities say. Criminals typically ship their loot through the ports of Los Angeles and Long Beach.

The Los Angeles Police Department recently arrested a man they said was associated with Russian organized crime who allegedly stole a skid-steer loader from a building site in the San Fernando Valley and took it directly to a 40-foot-long shipping container. From the Port of L.A., it went to Latvia.

The man, who police said was posing as a contractor, got ahold of the equipment and other gear from a rental firm using a stolen credit card number and fake identity.

Despite efforts to thwart construction theft, it continues to grow in Southern California. Last year, 1,186 pieces of wheeled machinery — including large compressors as well as bulldozers — were reported filched from Southland job sites, with 483 pieces recovered, according to the California Highway Patrol. Five years earlier, 472 items went missing.

Across the country last year, stolen equipment, tools and materials, such as copper, cost contractors and developers roughly $4 billion, according to the National Assn. of Home Builders. Builders, by some estimates, add 1.5% to the price of the average new house to cushion their losses.

Experts believe that there are far more thefts, and a far heavier burden on homeowners, than those statistics indicate.

“We figure there is probably twice the amount that doesn’t get reported stolen because contractors don’t want to jack up their insurance rates,” said Earl Gunnerson, executive director of the Crime Prevention Program of Southern California, a nonprofit task force that has served the construction industry since 1984.

California, Texas and Florida lead the nation in construction theft, Gunnerson said. In California, forklifts, front loader/ backhoes, skid-steers popularly called “Bobcats” and compressors are the most commonly taken.

Projects that have reached the stage at which various subcontractors are working on the building tend to be the hardest hit because they are expensive to fence off and difficult to patrol.

Nothing seems off limits. In May, a thief stole a San Bernardino resident’s newly installed frontyard, from sod to sprinklers. In Texas, police arrested a burglar who had plundered enough roof shingles, crown molding, windows and other supplies to pack five trucks. Crooks also have exploited the Inland Empire’s housing boom, lifting machinery and countless pallets of lumber.

It’s not hard to find takers for the stolen goods, either.

“Let’s say you are an unscrupulous contractor and you’re bidding against others,” said Lou Koven, an LAPD detective who works with the task force. “How do you lower your costs to compete? You steal from another job site.”

Knowing the territory

The thieves defy easy categorization. They may be gang members, professional burglars, people involved in mob crime or drug addicts looking to bankroll a fix.

Many share one advantage: insider information.

“It’s done by individuals with a very good working knowledge of the industry,” said Gabe Marquez, a California Highway Patrol investigator. “They know the job site, who’s there.”

Marquez recalled a construction thief who towed a trailer to a housing job and hauled away a 20-ton Caterpillar wheel-loader as if he worked for the rental company that owned it. “The next day the rental company came to pick up its equipment, and the contractor said, ‘We thought you picked it up yesterday.’ ”

Police have had their victories.

In August of last year, the Ventura County Sheriff’s Department busted a 24-person operation that had stolen $3.5-million worth of nail guns, generators, soil compactors, trucks and other goods throughout the Western states. Officials never learned the intended destination for those items.

In Palos Verdes Estates, a former construction worker and a young career burglar last winter allegedly plundered 10 luxury homes under construction. Raiding at night, using bolt cutters and a torch to break into padlocked containers, the pair took saws, drills, compressors and other tools valued at more than $1 million before they were apprehended.

The Crime Prevention Program task force has worked to educate contractors and others about how to deter criminals, and to teach police officers how to report stolen construction gear, which can be tougher than it sounds. The CHP, for instance, tracks only stolen equipment with wheels on it. Everything else is deemed a property theft, which falls to municipal police forces.

“The law enforcement guys are really, really good at auto theft,” said Mike Smith, sales manager at Coastline Equipment of Long Beach.

“They know vehicles. You can track them with vehicle identification numbers. None of that applies to tractors. There is no resource for the authorities to go check it.”

Large pieces of construction equipment are marked with vehicle ID numbers. But there is no central database or means to track down those numbers.

Because the heaviest equipment fetches upward of $1 million, some contractors have installed specially made GPS transmitters and LoJack-style recovery systems — even on compressors and generators. Closed-circuit cameras, fencing and security guards are also used.

All these methods carry a price tag. Guards can cost $6,000 to $8,000 a month at a development under construction, said Tom Wong, vice president at Sacramento-based Cresleigh Homes.

“When you are a home builder or contractor, your job site is a sitting duck,” Wong said, “the outdoor Home Depot for the bad guys.”

After several identity-theft-aided rip-offs of its equipment, including a $7,000 stump grinder, Simon’s Rental in Monrovia has changed its policies. Simon’s now requires its leasing customers to give thumbprints.