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FMCSA yet to receive evidence of broker transparency law violations

FMCSA's Jim Mullen (second from right) at HOS listening session last year. (Photo: John Gallagher/FreightWaves).

Despite widespread complaints by small business truckers that they are being gouged by freight brokers that refuse to offer financial transparency under a federal rule, the industry’s top regulator has yet to see formal evidence backing their case.

“It’s a hot topic now – there were protesters here in D.C., and the President has spoken on some of these issues,” Federal Motor Carrier Safety Administration (FMCSA) Acting Administrator Jim Mullen told attendees of a webinar hosted by the Intermodal Association of North America, or IANA, on May 28. However, he said, “the vast number of complaints we have about the freight brokerage space and the rates right now aren’t relative” to the federal broker transparency laws covered by 49 CFR 371.3, he said.

“In fact, we don’t have a specific complaint that a broker failed to abide by 371.3, in a situation in which the motor carrier hadn’t waived, contractually, the ability to get that financial data that the regulation encompasses.” But Mullen added: “We don’t expect this to go away anytime soon, and we take our regulatory obligations very seriously.”

After weeks of demonstrations in Washington, drivers accusing brokers of cheating and price-gouging, the Owner-Operator Independent Drivers Association (OOIDA) petitioned the FMCSA to enforce federal broker transparency laws, as well as prohibit brokers from issuing contracts that require carriers to waive their rights to access freight transaction records.


“Brokers have been deliberately skirting federal transparency regulations for decades,” OOIDA President and CEO Todd Spencer asserted. “We certainly don’t think exempting yourself from federal regulations is legal, but this is precisely what is happening. It has to stop.”

Mullen said during the IANA discussion that the FMCSA is considering OOIDA’s petition. “Step one of that deliberation is, do we even have the statutory authority? Expect, perhaps, a notice and comment.”

Mullen noted also that when 371.3 was initially written into law there were  different freight transaction processes in place. “Motor carriers paid brokers directly, versus the shipper paying the brokers,” he said. “So there’s perhaps some difference of opinion as to what the net effect of what that regulation was intended to be. I’ll save that debate for a different time.”

Speaking on the recently issued hours of service final rule, Mullen stressed that while the agency’s core focus was to improve safety, he acknowledged that modifying the 30-minute rest break – allowing the break to be satisfied by a driver using on-duty/not driving status rather than off-duty status – has the potential to provide the most meaningful benefits for carriers in terms of productivity and vehicle miles traveled.


In addition, he said, while his agency did not get as much feedback on the new short-haul provision as he had hoped, “that would be the next area that will probably have the most meaningful operational productivity benefits from our point of view,” he said. “But the industry will tell us that after the rule becomes effective and it has had time to analyze it.”

The final rule changes the short-haul exception by lengthening drivers’ maximum on‑duty period from 12 to 14 hours, and extends the distance limit within which the driver may operate from 100 air miles to 150 air miles.

Mullen also told IANA that the FMCSA’s national hours of service emergency exemption for the COVID-19 pandemic, extended until June 14 after it was initially declared on March 12, is being monitored very closely as to whether another extension will be needed.

“I would say that a good segment of the industry probably no longer needs that,” Mullen said. “There may be some sectors of the industry that might continue to need it, but we want to hear from the industry, and if you have feedback for us, we’re all ears.”

Waivers affecting the issuance of commercial driver’s licenses, commercial learner’s permits, and medical certificates, all set to expire June 30, are also being monitored for possible extension or cancellation, Mullen said.

19 Comments

  1. Tania

    Just look at the price fluctuations between brokers for the same loads on spot rates. They can range hundreds of dollars, I see it everyday.

  2. MICHAEL LARKINS

    You have got to be kidding me. Tell them to look at partial rates then. My driver just deliver yesterday in CO. CUSTOMER ASKED HIM!!! “How much did you get paid in this load? Because I paid $2500 to have it shipped.” My driver responded with the rate he was paid which was 1200. Yet your telling me there is no evidence. That means you need to stop looking under your desk for answers, because the facts are there you all just aren’t doing you job. And should be fired for admitting you knew this was going on and haven’t done anything for years. Gouging has been going on not just from 1 broker to carrier but also in the form of double brokering loads. Jesus. This busisness is not rocket science. 1 final question, and its a serious one. How far is your head up your @$$ that you can’t see what is right in front of you??? Maybe we should be looking into some bribery situations with these fmcsa guys.

  3. Mikhail Volyn

    No action, no designer to resolve problem, just bla bla bla, even President pointed out this issue.This is one of the major reason that trucking industry being abused by brokers and shippers long time. Department of Triansportation is the most bureaucratic entity of Goverment, they have done nothing to protect trucking business and crack down on dishonest brokers and shippers.

  4. Jonathan Elliot

    That’s the government we know. And that’s the government we expect. They say they’ll look into it when at the end of the day they’ll do nothing. They have too many lobbyist to satisfy rather than do something for the working man.

    1. Tommy

      Laughable, “workingman”?!?

      You don’t do the hardwork and want others to step in and hand you others private information.

      Bunch of clueless dimwitted drivers that blame everyone else.

  5. Anthony L Krause

    Any illegal parts of a contract make the contract null and void or at least that portion of the contract you can’t wave The right away.
    it would be illegal to put a waiver in the contract.
    enforce the laws on the books.

  6. Me

    Hard to see wrongdoing, when you don’t want to see it! It’s in the broker’s contracts! You are required to wave your rights, or you don’t work! If you don’t see that as unethical, then you yourself are unethical. The guy in charge come from one of the biggest crook companies. It’s clear, the brokers are robbing the truckers. Do something! CAP THEIR PERCENTAGE!

    1. Abe F

      The second you gore an ox – someone’s looking to gore yours.

      There’s a coming capacity crunch in this country and when that happens – rates will rocket up. Do NOT be surprised then if brokers/shippers ask to cap carrier’s percentages.

      Costs are 2.00 a mile? 10% cap is 2.20, you’re in violation if you deviate. Any entity that can cap a broker can cap a carrier. Do you, as a carrier, really believe you can plan for capital expenditures and grow on 10%?

      Carriers outsourced their sales and demand generation to brokers, carriers ACCEPTED the cheap rates, carriers waived recourse – yet somehow carriers are the victim and bear no responsibility?

      And before you sling – I’ve been a driver for 22 years, 4th generation. I’m just smart enough to realize that what’s good for the goose, is good for the gander and not surprised if it bites me back.

      1. MrBigR504

        Yeah whatever Honest Abe, lets just see the numbers from the shipper and then we can talk! We just want everything out in the open. Doesn’t make sense to cap someones revenue when we still don’t know what the original numbers from the shipper are! Its a moot point! We need to see the original invoice and then you start the proper percentage breakdown process all listed out in the open so we can see who really get whats been agreed on. Now if folks wanna start regulating what the percentage (CAP) should be, then we’ll cross that bridge if and when we come to it but it all starts from the original numbers being visible to all. The load paid $2000.00 but you wanna pay me $1100.00? Somebody’s calculator needs new batteries!

  7. Allen Townsend

    The FMSCA, the epitome of government bloat, will bury this for years. How much in resources in time and money did they spend “amending” the HOS rules? Unmentionable given that the net changes amounted to nothing. Drivers have always had to cheat a little on the 30 minute break while on duty waiting hours at a shipper. Otherwise they’d starve and end up in the bread lines.
    This issue with the brokers is not even in their realm.

  8. Ben

    Wait, this sounds like druvers that didn’t get their own accounts and out sourced the most important part of their business have made all this rate gouging thing up by assumption.
    Hmm, maybe rather than not accepting responsibility for their own business they should take the steps to put brokers out od business and get their own accounts. Like 90% of the industry.
    But then would require work. Sorry.

    1. Anthony L Krause

      Your numbers are incorrect even large trucking companies use brokers on back calls and they are notorious for double brokering loads get your facts right before you open your pie hole

      1. Ben

        I guess the not so subtle point is lost on you.

        Those others using brokers for backhauls HAVE THEIR OWN FREIGHT.
        And you don’t even have a basic understanding of what you are talking about.
        Your claim of double brokering is actually co-brokering.
        And the good news for you is that you don’t have to use a single broker EVER.

    2. Jerald

      So if you truly believe your right it’s a simple fix. Require all the information be transparent before and not after the load. Make it a requirement for freight shippers and brokerage. Thus clearing the air with all the information no assumptions required.

      1. Tommy

        Yeah, simple for you. Much easier to ask someone else to share private information rather than go and do the hard work finding your own customers.
        Not sure you can find a group of lazier “business” owners.
        I guess the idea of having to do more than hold a steering wheel is pretty terrifying.

        1. MrBigR504

          Hey Tommy, I don’t wanna know your bank pin number, i just wanna see the numbers from the shipper so we can have everything on the table and no more three card montey way of doing business thats all my friend! Really don’t see why that so hard to understand! One way or another, were gonna get some act right or these shelves will get thin again or have you forgotten who keeps America moving? JB Hunt and Swift and Werner cant cover it all thats for damn sure!

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.