Senators, Reps push to establish 'cop on the block' to shut down double brokering, other freight fraud

In a letter to the Department of Transportation Inspector General Eric J. Soskin dated May 22, 2023, five U.S. Senators and three House reps urged Soskin to work with the Department of Justice and the Federal Motor Carrier Safety Administration to explore a permanent task force policing fraud in brokered and other freight markets. The notion of such a task force I first heard proffered by transportation attorney Hank Seaton, whom regular Overdrive readers will well recall from his years of advocacy for clients and analysis around various legal matters. 

The Senators and House reps' letter explicitly addresses the issues of organized double brokering and other freight fraud and its rise in prominence in the spot market over many years, particularly the last couple. 

The letter urges DOT IG Soskin to work with the Department of Justice and the Federal Motor Carrier Safety Administration to explore a permanent task force dedicated to issues of fraud in brokered and other freight markets. There's something of a model for this, furthermore, insofar as the FMCSA and OIG are in fact originating, collaborative entities in a variety of identity-fraud cases that have ultimately been prosecuted, as the letter notes, likewise the long-ongoing effort to combat household-goods-movement scams and other crimes. 

Here's the nut of what the Senators and Reps are requesting (you can download the full letter via this link): 

Recognizing the continued growth of various forms of cargo theft and other supply chain crimes and building on the success of individual efforts there is an opportunity to establish a permanent task force within OIG to monitor freight, household goods moving, ransom, and double brokering fraud or address other cases of supply chain fraud that falls within OIG’s jurisdiction and to investigate and prosecute fraudulent activity consistent with existing civil and criminal penalties. We urge OIG to consider creating a special unit within the Inspector General’s office in consultation with FMCSA and the DOJ to investigate, refer and prosecute cases of transportation fraud in a systematic, concerted manner. Forming a special unit for this purpose at OIG appears to be consistent with OIG’s authority.   

Copied on the letter to DOT IG Soskin were Robyn Hutcheson, FMCSA Administrator, and Department of Justice IG Michael Horowitz. If that notion sounds familiar, it's pretty close to what attorney Seaton has proposed in both official comment to the FMCSA as well as in conversation with me. The letter to IG Soskin references this story, for instance, in Overdrive, published in the wake of the comment period around FMCSA's dispatch-service interim guidance last year. Seaton there, as well as in our conversation for this edition of the Overdrive Radio podcast weeks earlier, outlined the basic idea above.

Commenting on behalf of a coalition of carriers, brokers and shippers and their respective groups (including the National Association of Small Trucking Companies), he urged establishment of a "permanent task force to monitor complaints about fraudulent and intentional breaches of regulations by regulated brokers and carriers [with a] proactive prosecutorial staff to discharge its statutory and regulatory duties to enforce existing rules of commerce, including civil and criminal penalties available to the Department of Transportation."