well the new law proposed by the FMCSA where if the broker dips below $75k they have 7 days to replenish to keep their authority is a good start. I'ev come across a few brokers who have had their Bonds completely drained, and still broker loads...But I agree it should be a minimum of 500k or based on the volume of business or gross they report on their taxes. Putting aside the smaller brokers, its cray cray that the the mega brokers also only need to have the $75k Bond but their earnings calls show couple billions in revenue in a quarter. Make it make sense.
STS - Southern Transportation Systems
- Thread starter Jaison
- Start date
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It's a good start.. but once the bond is breached the broker would in affect become radioactive.. it would be like making good on a bounced check..
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As a freight broker, I have no problem adhering to whatever rules and regulations are in place, currently or in the future. I also would welcome more stringent and vigorous enforcement of the existing rules. The biggest impediment we all face in attempting to clean up this industry is the companies who, for whatever reason, continue to ignore the rules and broker freight without any licensing, carriers, and brokers alike.. Also to blame are the carriers who turn a blind eye and actively support this illegal activity by doing business with these scoff laws. If a carrier is serious about stamping out this type of unethical and illegal behavior......stop doing business with unlicensed brokers. It is that simple!
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Bonds serve a specific purpose. However they are not meant to be a replacement for performing your own due diligence. Properly vetting your customers for credit worthiness remains your best defense.
Or pay before delivery - no credit. That would fix things over night.
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Sure.. if everyone did that.. The only people who would be out then would be those who paid before delivery.. and then the delivery didn't occur.
Yes, but then that brings up a whole different issue that the police can be called as the carrier would be holding freight that the service has been paid. A scam carrier would only get away with that once.
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Police won't respond.. civil matter.. they won't even call back.. been there done that. Not to knock the police.. maybe they really are that underfunded...
although I like the idea, a shipper really shouldn't have to get involved in the Broker/Carrier relationships or inner workings. Ideally, if FMCSA has a system to check and enforce if and when a Brokers bond goes below the amount (in relative real time) that would be great. I mean they are quick to put Carriers OOS or revoke authorities so this shouldn't be as hard as one would think.
I think you need to support your police department more, YRP in Newmarket/Aurora has no issues getting involved and investigating freight fraud, or intent to de-fraud. Guess its still depends on who ya know to some extent.
Some of us "heavy weights" move loads for more than $75 margins, and still move hundreds per day. Vetting carriers, with finance, performance, and communication KPI's and proper sleuthing / due diligence goes a long way to minimizing our exposure to "bad apples"
I agree the 75k is rain drop sized bond for most established brokers.
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I do.. but let's say my load disappears in New Jersey.. I pay no taxes there.. I don't vote there. Do you think any police department there will tie up a single rookie officer to run after my lost load? Me neither..
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Only 5% of all businesses ever crack 1 million in sales a year.. that's one in twenty businesses..... Most startups...80%.. are teetes up within 5 years of startup date. Those are the stats. Sure, a 75K bond is small potatoes for a TQL or a CH Robinson or perhaps even the guy turning 30 million a year... but they're like shippers anyway... lots of fixed assets to go after in the event of nonpayment that the little guys don't necessarily have.
Ya, that definitely and issue that long haul guys face, vs us local cartage carriers who operate just in Ontario.
this clown scammed us out of money after they double brokered a load from NC to Calgary (airplane parts). Tried the same tactics where he demanded payment? I told him to correct his tone when speaking to a woman and that I am the carrier, YOU are to pay me so why are you asking me for payment??? The company was formerly called Quick Van Lines. The same piece of shit Stephane Vargas was one of the directors. We never got paid and they closed the doors and opened up under another name, and I see still scamming people.
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Have you hauled freight for Southern Transportation Systems and have NOT been paid for your services? Contact our firm today! 662-373-2067. We can recover your money, even if the company has gone out of business.
Kizer Schwartz & Assoc. LLC
D. 662-373-2067
asmith@kizer-schwartz.com
1
Have you hauled freight for Southern Transportation Systems and have NOT been paid for your services? Contact our firm today! 662-373-2067. We can recover your money, even if the company has gone out of business.
Kizer Schwartz & Assoc. LLC
D. 662-373-2067
asmith@kizer-schwartz.com