Despite efforts made by the Federal Motor Carrier Safety Administration (FMCSA), double-brokering is still a major issue that’s costing our industry millions. This is why at Knichel Logistics, we are taking a stand to end this illegal practice. Not only do we want to protect our customers and partners, but the entire industry as a whole.
What is Double-Brokering and Why is it Bad?
We wrote about this issue before, but to recap, double-brokering occurs when a carrier takes a load and then re-brokers it to another carrier without the original party’s consent or knowledge. This can be because the carrier is trying to save money by handing off the load to another company for less than what they were paid or because of scammers who are posing as carriers. It can lead to a plethora of issues, such as liability, loss of insurance coverage on the freight, missing or damaged goods, or the shipper having to double the rate.
What Knichel is Doing to Stop Double-Brokering:
The FMCSA has issued multiple laws and opened data bases to stop double-brokering; however, currently there is just a lack of resources available to feasibly enforce this due to the overwhelming amount of carriers and brokers out there. Because of this, Knichel Logistics is taking the initiative to help put an end to these unlawful practices.
To help protect our customers and weed out potential fraudulent carriers, we use Highway-- a carrier identity management system. It creates a two-factor authentication for carriers before they onboard to verify their identity. This is so the information we send and receive is from the right carrier and not a scammer. Additionally, as we on-board, the system also helps us vet the carrier by providing real-time data on identity alerts, proof of insurance and inspections, locations of uninspected carriers, and equipment filters and age.
At Knichel Logistics, we require our carriers to pass the entire vetting process; if not, we will not register them into our TMS (a cloud-based transportation management system). Highway is one of the best ways to help us stop double-brokering and help us protect our customers and self from these bad actors. Along with Highway, we still utilize Carrier 411- a data platform for carriers, shippers, and brokers to monitor FMSCA compliance, performance, and more.
Lastly, we help fight against double-brokering by helping to better fund and resource the FMCSA. Kristy Knichel herself has personally advocated along with TIA committee to Members of Congress to get support.
Double-brokering is a serious issue that needs to be addressed and continuously pushed back against. By utilizing authenticating software, databases, and helping increase enforcement, we can halt these unlawful operations. Knichel Logistics will continue to implement these system and provide support to protect our industry. If you have questions or concerns, do not hesitate to reach out.
