Trucking industry groups are applauding the introduction of a bill in Congress that would enhance the Federal Motor Carrier Safety Administration (FMCSA’s) ability to crack down on freight fraud in the residential moving company sector.
The bipartisan “Household Goods Shipping Consumer Protection Act” was sponsored by Congresswoman Eleanor Holmes Norton (D-DC) and Congressman Mike Ezell (R-MS) and is now in the process of hearings before the House Transportation and Infrastructure Committee.
According to Rep. Norton, the bill is aimed at fraud perpetrated by scammers in the interstate transportation of household goods. “The bill was written to address a growing type of fraud involving entities that charge an up-front fee, pack and hold consumers’ household goods, then demand more funds to deliver or release the items. The companies involved have launched websites with fake 5-star reviews, and when negative reviews are submitted, the scammers simply close down the existing companies and open new ones, repeating the original scheme under a new FMCSA license,” Norton’s office said in a release.
The bill comes as motor carriers across the industry are victimized through unpaid claims, unpaid loads, double brokered loads, or load phishing schemes on a daily basis, costing the trucking industry over $800 million annually, according to the Owner-Operator Independent Drivers Association (OOIDA).
A core cause of that situation is the body of inadequate and seldom-enforced broker regulations under U.S. Department of Transportation rules, OOIDA said. As a solution, the new act restores and codifies FMCSA’s authority to issue civil penalties against bad actors, and requires that brokers, freight forwarders, and carriers provide a valid business address to FMCSA in order to register for authority.
"Freight fraud committed by criminals and scam artists has been devastating to many small business truckers simply trying to make a living in a tough freight market,” OOIDA President Todd Spencer said ina release. “OOIDA and the 150,000 small-business truckers we represent applaud Representative Holmes Norton and Representative Ezell for their bipartisan leadership to provide FMCSA better tools to root out fraudulent actors, which are also harmful to consumers and highway safety.”
Additional support for the bill came from the Transportation Intermediaries Association (TIA), a trade group for third-party logistics providers. “Combating fraud through effective legislation is imperative for the protection of brokers, motor carriers, shippers, consumers and the overall integrity of the supply chain. Fraudulent activities not only cause significant financial losses but also undermine public trust in institutions and markets. By implementing these strong anti-fraud laws, our government can ensure a more stable and predictable economic environment, which is essential for sustainable growth and investment,” Anne Reinke, president & CEO of TIA, said in a release.
