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FMCSA seeks comment on proposal to eliminate ‘bad-actor’ brokers

Agency now considering opposing petitions from TIA and OOIDA

Petitions by TIA, OOIDA battle at FMCSA. (Photo: Jim Allen/FreightWaves)

Federal regulators are now considering opposing petitions on rulemakings affecting how brokers conduct business in the latest development of a regulatory battle between brokers and independent owner-operators.

The Federal Motor Carrier Safety Administration (FMCSA) will publish on Wednesday a request for comment on the Transportation Intermediaries Association (TIA) petition to overturn a rule that allows parties involved in a brokered transaction to review records related to the transaction — a regulation created as trucking was being deregulated in 1980. TIA is also asking FMCSA to close a “dangerous loophole” that it claims allows unlicensed brokers to operate.

The revisions, according to TIA, “will improve safety for all entities within the transportation marketplace by removing bad actors from the marketplace and eliminating an administrative burden from the agency to enforce outdated and unnecessary regulations.”

TIA’s request contrasts with petitions filed earlier this year from the Owner-Operator Independent Drivers Association (OOIDA) and the Small Business in Transportation Coalition (SBTC) asking that FMCSA propose a rulemaking that offers more transparency and strengthens the rule in question – 49 CFR 371.3(c) – as opposed to eliminating it.


“Prior to this becoming a recent hot-button issue, with truck protests outside the White House during the COVID-19 pandemic, there has not been one single complaint made to the Department of Transportation’s National Consumer Complaint Database for a violation of a broker not disclosing their commission” under the regulation, TIA stated in its petition request.

“Moreover, motor carrier transportation on the spot market is one of the most transparent marketplaces in the world. Load boards, the internet and rate quotes in person-to-person communications within the industry provide the rate transparency that was intended by 49 CFR 371.3 when commissions paid by carriers to brokers were common. Motor carriers have sufficient access to current market rates without inspecting brokers’ shipment records to find out what the brokers’ gross margins are on a load-by-load basis.”

TIA wants FMCSA to also provide guidance on what constitutes a “dispatch service,” which the association asserts is essentially unlicensed brokers.

“The dispatch service is paid a commission by the motor carrier for their services, not the model that generally applies to brokers, where the shipper pays the broker for their service and the broker pays the motor carrier,” TIA stated. “We believe there are many illegal dispatch services that are operating illegally as unlicensed brokers. FMCSA should prohibit these companies from offering such a service without a license.”


A 60-day comment period will begin after the petition is posted in the Federal Register.

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26 Comments

  1. Brandon

    I believe there should be a 15% cap on what brokers make period! That way we don’t need to know exactly how much the shipper is paying. The broker will still get the max possible. Trucks will now get the fair share. Then it makes it easier to inforce the 15% rule or get fined or shut down. What do you guys think about this fix?

  2. Liv Diaz

    I don’t believe the licensing is a big problem. There are brokers who are not licensed, who provide better service than the big broker companies who are. Maybe I’m wrong on this. What I do know….I saw first hand, from the inside, the abuse of how much was offered to a carrier from a big, well-known 3PL, when far, far more could be compensated.

    1. Brandon

      I believe there should be a 15% cap on what brokers make period! That way we don’t need to know exactly how much the shipper is paying. The broker will still get the max possible. Trucks will now get the fair share. Then it makes it easier to inforce the 15% rule or get fined or shut down. What do you guys think about this fix?

  3. Tony

    Transparent information is a must. When loads just cover operating costs and big broker low level employees can retire in their 30’s unfair practices are the norm. Yes I do know such cases.
    What truckers know as industry standards is little more then criminal business.
    FYI Transportation and Logistics major inside information from fellow classmates over 30 years.

  4. che smith

    As an owner operator I believe that the transparency from the customer to the broker and then to the driver or owner operator should be very transparent we provide all of the insurance we provide the vehicle and we provide the safe travel on the highways I’ve been doing this for 24 years and I’ve seen all kinds of other disasters on the highways on top of overcrowding this would help alleviate some of that problem as for owner operators would be able to seek out contracts with these companies and have a fair market

  5. Lawrence Williams

    Bad brokers is a drain on the transportation industry, brokers that don’t pay, under pay industry rates and charge a percentage of their rate to “Quick Pay” carriers after delivery or the carriers have to wait 30, 60, 90 days to be.
    The worst act brokers do is charge the carrier a $500.00 late fee, I mean come on even the biggest carrier in the country JB Hunt is late delivering loads sometimes.
    I think Bad Brokers should be Put Out Of Service like bad carriers and drivers, “Stop Messing With My Money.” Me. Lawrence Williams Illuminati Trucking.

    1. che smith

      As an owner operator I believe that the transparency from the customer to the broker and then to the driver or owner operator should be very transparent we provide all of the insurance we provide the vehicle and we provide the safe travel on the highways I’ve been doing this for 24 years and I’ve seen all kinds of other disasters on the highways on top of overcrowding this would help alleviate some of that problem as for owner operators would be able to speak out contracts with these companies and have a fair market

Comments are closed.

John Gallagher

Based in Washington, D.C., John specializes in regulation and legislation affecting all sectors of freight transportation. He has covered rail, trucking and maritime issues since 1993 for a variety of publications based in the U.S. and the U.K. John began business reporting in 1993 at Broadcasting & Cable Magazine. He graduated from Florida State University majoring in English and business.