June 15, 2010 4:00 PM, EDT

Senators Introduce Bill to Curb Broker Fraud

A pair of Senators introduced legislation Tuesday aimed at curbing the fraud by unscrupulous freight brokers.

Sens. Olympia Snowe (R-Maine) and Amy Klobuchar (D-Minn.) introduced the Motor Carrier Protection Act, which, according to a release “would update the current requirements and provide motor vehicle operators with the tools they need to protect themselves and their company from abuse.”

“All too often motor vehicle operators fall victim to the deceitful behavior of fly-by-night brokers and freight forwarders who engage in preposterous criminal activities, such as financial fraud,” Snowe said in a statement. “By updating current regulations, this legislation will give trucking operators peace of mind that they will, indeed, receive payment for a job well done.”

Klobuchar said the bill “ensures trucking operators have the tools and protections necessary to prevent fraud, and also modernizes and strengthens federal oversight of this industry.”

“Many truckers are small, independent businesses that fraudulent freight forwarders and corrupt brokers too often easily prey upon,” she said.

In a joint statement, the pair said the bill would, among other things:

• increase the broker bond to $100,000 from $10,000, applying bond requirements to freight forwarders;

• establish stricter requirements for entities seeking broker or forwarder authority; and

• stiffen penalties for a number of violations of broker regulations.

“If passed, this law would put a stop to a system that allows rogue brokers and scam artists to operate unchecked,” said Todd Spencer, executive vice president of the Owner-Operator Independent Drivers Association.

“Too often, we’ve seen bad brokers get away with collecting payment from shippers but leaving truckers holding the bag,” he said in a statement.