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FMCSA Targets Unscrupulous Freight Brokers: Protecting Truckers from Non-Paying Brokers - Trucking101

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FMCSA Targets Unscrupulous Freight Brokers: Protecting Truckers from Non-Paying Brokers

Multiple trucks parked at the Mid America Trucking Show, representing the trucking industry's efforts to combat unfair broker practices.

Written by Jason Decker

March 21, 2023

In this article:

-The FMCSA plans to hold a public listening session on March 31, 2023.

-The NPRM aims to enhance financial responsibility in five key areas.

-The deadline for public comments has been extended to April 6, 2023.

-The deadline for public comments has been extended to April 6, 2023.

1. Introduction

The FMCSA has scheduled a listening session on March 31 during the Mid America Trucking Show (MATS) in Louisville, Kentucky. Their goal is to collect input on a pair of subjects: the preliminary guidance issued in November, which sheds light on their interpretation of broker and bona fide agent definitions, and a proposal unveiled on January 5, aimed at regulating five key areas of broker financial responsibility.

The Federal Motor Carrier Safety Administration (FMCSA) is proactively tackling the problem of dishonest freight brokers who fail to compensate truckers. A new regulation focused on the financial responsibility of brokers and freight forwarders is presently in the public comment stage, which now lasts until April 6, 2023.

2. FMCSA Comment Period Extension and Listening Session

The FMCSA has decided to extend the deadline for public comments on the Notice of Proposed Rule Making (NPRM) and will hold a public listening session in Louisville, Kentucky, on March 31, 2023. This allows interested parties more time to engage with the proposed changes and provide valuable input to the FMCSA.

3. Proposed Changes to Enhance Financial Responsibility

The NPRM outlines five key areas where changes are proposed to improve financial responsibility among brokers and freight forwarders:

3.1. Assets Readily Available

Brokers or freight forwarders can meet the MAP-21 requirement by maintaining trusts with specific criteria, ensuring they have the necessary assets available to pay truckers.

3.2. Suspension of Operating Authority

If a broker or freight forwarder’s “available financial security” falls below $75,000, the FMCSA will suspend their operating authority. To regain it, they must replenish the funds within seven business days.

3.3. Surety/Trust Responsibilities

The FMCSA aims to define “financial failure or insolvency” and propose requirements for surety/trustees in case a broker or freight forwarder becomes insolvent, providing added protection for truckers.

3.4. Enforcement Authority

The FMCSA proposes a process for suspending a surety provider’s authority and adding penalties for violations of the new requirements, ensuring compliance with the updated regulations.

3.5. Eligible Trust Fund Providers

To further protect truckers, the FMCSA proposes excluding loan and finance companies from serving as BMC-85 trustees, ensuring only reliable providers are involved in this critical role.

4. Public Input and Next Steps

As of now, 55 public comments have been received on the NPRM. The extended comment period and upcoming listening session provide further opportunities for stakeholders to voice their opinions and concerns. The FMCSA is encouraging the public to actively participate in shaping these regulations, which will significantly impact the trucking industry.

5. Conclusion

The FMCSA’s proposed rule aims to strengthen financial responsibility and crack down on unscrupulous freight brokers who fail to pay truckers. By extending the public comment period and holding a listening session, the FMCSA is providing more opportunities for stakeholders to contribute their insights and help develop effective regulations. Ultimately, these changes will protect truckers, promote fair business practices, and improve the overall integrity of the freight brokerage industry.

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