A $10 million nut heist is a window into the shady, lucrative world of large-scale food theft

It’s a story of fraud, organized crime, and nuts.
It’s a story of fraud, organized crime, and nuts.
Image: Reuters/Caren Firouz
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Some of the hottest items on the black market these days are nuts.

More than 30 truckloads of almonds, pistachios, cashews, pecans, and walnuts have been stolen from nut growers and processors in central California in the last six months. Thieves infiltrating the long and complicated chain that link farms to retailers have made off with an estimated $10 million in product, on a scale that has stunned farmers and law enforcement alike.

“All we’ve seen in the past is in orchard theft, where guys take a bucket and go sell them at the farmers’ market. We’ve never seen anything like this,” said Roger Isom, president of the Western Agricultural Processors Association (WAPA).

Food and beverages have replaced electronics as the most-stolen good in the US. Criminals are concentrating their efforts on fewer heists of larger value, and as stolen goods go, nuts have a lot of appeal. They’re expensive. They have a long shelf life. They have no serial numbers and can’t be electronically tagged or traced.

And in central California, there’s nothing inherently suspicious about driving around with a truckload of nuts. The state grows 98% of the US commercial pistachio supply, 99% of US walnuts, and 80% of the world’s almonds. It grows a small percentage of the country’s pecans, and processes imported cashews too.

“I can pull over a car with 20 lbs. of methamphetamine in it and that driver’s going to jail,” said Tulare County Sheriff Mike Boudreaux. “I pull over 30,000 lbs. of pistachios, I have to prove that those are stolen, otherwise the guy goes on his way.”

The heists are carried out through fraud, not force. Law enforcement officials are reluctant to share details of ongoing investigations. But their efforts center on a network of criminals with a sophisticated understanding of the complex distribution systems connecting growers and processors to major buyers.

“It’s not your guy on the corner in the long jacket, selling knock-off Rolex watches,” Boudreaux said.

Say, for example, that a chain retailer like Costco orders thousands of pounds of pistachios from a grower in central California. Costco doesn’t have enough trucks in its own fleet to collect every shipment it needs, so it farms the pick-up contract to a broker—an online auction where trucking companies bid for the job. Successful bidders often then sub-contract the job to independent drivers.

Criminals are infiltrating this long chain between buyer and seller, setting up fictitious companies, altering paperwork, and diverting shipments so that legitimately-placed orders end up in nefarious hands. In some cases, even drivers delivering stolen loads don’t realize they’re participating in a crime.

“They show up with the paperwork. It looks legit. And because we’ve never seen this before, we’re kind of gullible,” Isom said. Many victims have been reluctant to go public with their stories out of embarrassment, he said.

Cases of tree nut loads stolen via fraud have risen steadily in the US, from four reported incidents valued at $487,790 in 2012 to 28 incidents valued at almost $4 million in 2015, according to anti-theft network CargoNet.

WAPA organized an emergency meeting last week that drew 120 people to learn about how to protect themselves against the crime.

The crimes are spread across multiple jurisdictions in California, making it difficult for investigators to coordinate efforts. State assemblywoman Kristin Olsen has introduced a bill to fund a task force that would let agencies work together.

“Every coordinated and successful attempt at cargo theft is a direct hit on not only the pockets of hardworking farmers and farmworkers in California, but on our state’s economy,” Olsen’s communications director Allison Wescott said. “We have to give law enforcement the tools they need to put a stop to these crimes.”