Dive Brief:
- With freight rates remaining in the cellar and brokerage fraud running rampant, the Owner-Operator Independent Drivers Association is again advocating to the Federal Motor Carrier Safety Administration for stricter broker transparency requirements.
- Three years have passed since OOIDA submitted its original petition to the FMCSA, and more than 28 months have gone by since the most recent public comment period ended, President and CEO Todd Spencer said in an Aug. 17 letter to Administrator Robin Hutcheson. The agency had promised a rulemaking in June, he noted.
- “Now that it’s mid-August, OOIDA members are understandably questioning the status of the proposal,” Spencer wrote. “Unfortunately, our association has to report that the [notice of proposed rulemaking] is still pending even as broker concerns increasingly plague the industry.”
Dive Insight:
The association president reiterated requests in his September letter to the agency on the issue: OOIDA wants FMCSA to provide carriers with transaction information automatically within 48 hours of a haul and prohibit brokers from requiring carriers to waive their right to view the records.
The association says a lack of enforcement of current requirements has resulted in an “inequitable economic environment for motor carriers, especially small-businesses that are victimized by unscrupulous brokers.”
“We believe the agency must publish the [notice of proposed rulemaking] and promote broker transparency as soon as possible,” Spencer wrote in his letter last week.
An FMCSA spokesperson told Transport Dive on Thursday they would look into the agency’s response.
Other stakeholders are also being burned by fraud. The issue has cost legitimate brokers, carriers, shippers and consumers $800 million or more, Transportation Intermediaries Association President and CEO Anne Reinke said during a hearing in May.
Persistently low freight rates contribute to some of the frustration voiced by small-business truckers about broker fraud, OOIDA acknowledged. Any prolonged downturn tends to exacerbate the issue by prompting desperate drivers to accept loads for less than they should — often without due diligence checks for red flags of fraud.
“We understand that not all low rates are the result of unscrupulous brokers, but it can be difficult for carriers to identify legitimate brokers with the ineffective transparency regulations currently in place,” Spencer wrote.
