FMCSA Moves to Protect Fleets From ID Theft

This story appears in the May 21 print edition of Transport Topics. Click here to subscribe today.

Brent Jones first got word March 27 that his trucking company’s name was being used as part of a freight load board fraud scheme.

“I got a phone call from a credit agency,” said Jones, owner of Baja Enterprises Inc. “They said they were doing some research and something seemed fishy because our company had an address in San Francisco.”

Fishy indeed, because Baja’s headquarters are in Cedar Falls, Iowa. It didn’t take Jones long to discover that someone had gone into a Federal Motor Carrier Safety Administration Web site and changed the address of his company. The address change apparently allowed a California-based freight-load broker to receive payment for fraudulent contracts using Baja’s name and federal motor carrier number.

Jones said his small trucking company was lucky that it has not suffered any apparent financial damage. Still, he has little doubt that his company’s name was used to cheat at least a few trucking firms out of their money. Federal authorities are now investigating the case, looking into a company using the name Cargoland Brokerage, Jones said.

Attempts by Transport Topics to reach Cargoland were not successful. Its Web site and phone were not working, and the company is no longer registered with FMCSA.

Jones’ advice to fellow truckers: Keep an eye on the accuracy of your company’s entry on the FMCSA Web site and check the creditworthiness of the companies you deal with on Internet load boards.

Baja is a textbook victim in what trucking load board security experts such as Doug Moscrip said is an increasing problem among carriers and brokers who use Internet load boards to ensure that their trucks don’t return home empty. As a result, Web site operators are tightening their security. The Internet Truckstop sends out security alerts when companies report suspected violators.

“These crooks are some very knowledgeable people,” said Moscrip, head of security for Internet Truckstop. “These guys’ documents are better than half of the legitimate brokers’, I’m told.”

FMCSA has taken note, announcing in April that it is taking “immediate steps” to correct a vulnerability identified on its licensing and insurance Web site.

In one of those steps, FMCSA no longer permits changes on its Web site to company names, addresses, operating authority transfers and operating authority voluntary revocations. Companies now will be required to fax or mail in such changes to documents that will be verified, said Duane DeBruyne, an FMCSA spokesman.

“It’s a brave new world, and we need to be vigilant,” DeBruyne said. “We’re expending a lot of time, energy and research to make our security presence much more robust.”

But there are other ways scammers attempt to beat honest truckers out of their money, and one high-profile California case shines light on how load board fraud schemes can commonly work.

In charges filed last summer by the U.S. Attorney for the Eastern District of California, Kulwant Singh Gill was accused of operating about two dozen California-based companies that from 2002 to 2005, according to a government affidavit, illegally “double-brokered” freight loads and cheated honest truckers out of more than $80,000.

Here’s how the government said the scheme worked: Gill would log on to Internet load-posting boards that advertised loads available for transport. He then would locate a specific load, contact a broker and claim to be an available motor carrier, according to a 36-page written affidavit of Efferem Poynter, a special agent with the Department of Transportation’s Inspector General.

Once a price was determined, Gill then agreed to transport the load. However, instead of transporting the load as in the agreement, he placed an advertisement for the load on a different Internet board but used the name of one of the fictitious broker companies he had created.

After a trucking company completed the delivery of the load, the original broker would submit payment to Gill, who, according to the government affidavit, would disconnect his telephones and change the names and addresses of his brokerages and carrier companies to avoid passing along the payment to the carrier.

Gill, who has pleaded not guilty and been released on a $200,000 unsecured appearance bond, is scheduled for a status hearing on May 22 in U.S. District Court in Sacramento, Calif. Gill’s attorney, Peter Priamos, did not return a message left at his office.

Web site security improvements aside, truckers such as Regina Wood, co-owner of Apple Trucking Inc., Germantown, Wis., said she now checks the FMCSA Web site every day to make sure her company’s information has not been altered.

Wood discovered in March that someone had changed the address of her two-truck company to somewhere in California when she got a call from an insurance agent who was wondering what happened to a trailer full of roses that Apple was supposed to deliver.

Right away, Wood knew something was wrong because her company owns no refrigerated trucks.

She said Apple’s information on the FMCSA Web site has since been corrected, but she remains vigilant.

“What a mess,” she said. “It’s unbelievable.”