The Transportation Intermediaries Association, Owner-Operator Independent Drivers Association, and American Trucking Associations have joined together in supporting HR 2357, “Fighting Fraud in Transportation Act 2011,” (FFIT), which would address issues of fraud that plague the marketplace. The bill was introduced by US Reps Russ Carnahan (D-MO) and Frank Guinta (R-NH).
The organizations believed a united approach was required to correct problems with unscrupulous operators that victimized both brokers and carriers. Past discussions with Rep Peter DeFazio (D-OR), former chairman of the US House Subcommittee on Highways and Transit, led both groups to find a shared solution to the problems that members of all the organizations were experiencing.
“The legislation recognizes that the brokerage and overall transportation industry have changed since the ICC Termination Act. The FFIT Act will address serious fraud and confusion in the industry. It is supported by the leading transportation associations in Washington, representing companies of all sizes, who are united in our belief that this will, insure that providers are properly capitalized and can meet their financial obligations,” said Robert Voltmann, TIA president and chief executive officer.
“Brokers, forwarders, owner-operators, and carriers need each other, and the speed of today’s logistics marketplace means that companies must be able to reasonably rely on representations made in the terms of their agreement. Unfortunately, the seeping encroachment of fraudulent operations have left the legitimate industry vulnerable. We welcome the opportunity to work with the Owner-Operator and Independent Drivers Association and the American Trucking Associations to fight industry fraud so that our members can continue to grow their family businesses,” Voltmann said.
Key provisions of the proposed legislation would require brokers and freight forwarders to carry a $100,000 bond; provide strict regulation of broker surety companies so they must fulfill obligations to brokers and forwarders; provide greater transparency for those seeking to become brokers or forwarders; establish significant penalties including unlimited liability for freight charges for those operating without required authority; require motor carriers to hold broker or freight forwarder authority; clarify that a motor carrier may provide transportation of property with self-propelled motor vehicles owned or leased by the motor carrier or through interchanges as permitted under regulation issued by the secretary, provided that the originating carrier must physically transport the cargo at some point; retain liability for the cargo and payment of interchanged carriers; and require there must be at least one corporate officer who has met minimum training standards or equivalent experience.
“This legislation will bring an end to bad bonding companies, carriers brokering without a license or bond, scam artists that come in and out of the market to rip people off, and it will create a competitive playing field for the legitimate industry. This legislation is not about regulating brokers or carriers; it is about fighting fraud in the trucking industry,” said Alec Gizzi, president of JBS Logistics Inc and chairman of TIA.