Crime syndicates are lurking in the transportation and logistics industry shadows—and their double brokering schemes have now reached historic levels. Unfortunately, while this pervasive crime has been a hot button issue for a few years now, the FMCSA hasn’t acted swiftly to address it—missing key opportunities to educate vulnerable businesses and create regulations that protect us from fraud.
As a result, scammers are perpetuating massive amounts of rate and freight theft today.
That’s why it’s all the more critical that we remain on guard. After all, when legitimate shippers, carriers, and 3PLs fall victim, everyone loses.
Want to better understand how double brokering freight works—and how to protect your business?
Here’s what you should know.
What is double brokering freight, exactly?
This rising crime can play out in a few different ways.
In some cases, a scammer carrier with a legitimate MC number will accept a load and then subcontract or “double-broker” with another carrier to move it.
Another way to get stung is when a freight broker or 3PL lacks the robust carrier vetting process necessary to avoid a fraudulent carrier. Operating with a stolen identity and spoofed email, the scammer secures the contract and rebrokers the load with an honest carrier—but directs the driver to a new destination when they arrive at the dock.
Finally, a scammer can commit identity theft, impersonating a legitimate broker and going directly to the shipper to pitch their “services.” Where things go from there is rarely good.
No matter the scenario, double brokering freight can result in significant losses—and increase the risk of accidents. Crime syndicates aren’t shy about setting carrier safety records aside in favor of a quick buck, after all.
A growing, increasingly sophisticated cargo theft threat
Sure, double brokering freight has always been a problem, but it’s become increasingly prevalent in recent years—and it’s not hard to understand why. It’s all too easy to get your hands on an MC number, and spoofing emails and websites isn’t that difficult.
Without a robust carrier vetting process and a series of confirmation checks before loads leave the dock, something could easily be missed.
The scale of this crime is growing by the day. In fact, we’re easily getting 50 double brokers ready to “jump in and help” for every load we post. Situations where we see a single truck on an MC number, a business in operation for only two months, and a truck that hasn’t undergone any inspections are pretty common.
And California’s San Fernando Valley? That’s ground zero for double-brokered freight.
We should note: It’s not down-on-his/her-luck brokers or truckers driving the growth of this crime. Rather, it’s sophisticated crime syndicates. They’re organized, digital-savvy, well-financed masters of manipulation—and they have no scruples.
It’s why doubling down on your cargo security protocols is so crucial.
So, what can a shipper, like you, do to protect your freight?
For starters, and we realize this sounds dark—trust no one. Adopt an air of suspicion whenever you’re talking to someone new, and make them earn your trust over time. If you’re ever unsure, if something feels just a bit off, get a second and third opinion. Extra sets of eyes can save you from the frustrating time-suck that is filing police reports and cargo insurance claims—all while hoping you get your freight back (and knowing full well that recovery rates aren’t exactly great). And your reputation? Well, that’s something that you may never get back.
Putting a robust system of checks in place can also help you identify red flags—protecting you from ransom demands and ensuring your loads don’t vanish into thin air.
Looking to partner with a reputable 3PL—or planning to expand your capacity internally?
Ask lots of questions—of your prospective 3PL partner or yourself:
- What’s your carrier vetting and onboarding policy?
- Have they had their operating authority for at least three months?
- Have they undergone any inspections in the area they’re picking up or delivering in?
- Have they had more than two inspections within the last year?
- How are you verifying that new carriers are who they say they are?
- Do the names match their emails—and do they check out on a trusted, third-party carrier verification tool, like SaferWatch, Carrier 411, MyCarrierPacks, Carrier Assure, RMIS, or Highway?
- Are you contacting companies to confirm they’re real via the phone numbers and emails listed in your verification tool?
- Are you confirming carrier insurance policies are current before they move your loads?
- Are you checking to ensure the policy limits are sufficient to cover the loads?
- Are you using tools to support regular carrier monitoring and review, like MyCarrier Packets, RMIS, and Highway?
- What cargo security protocols and technologies are you putting in place to protect and trace your load from dock to dock?
A 3PL that operates with integrity will jump through a dozen flaming hoops to ensure new carriers are above board before they ever haul your freight. You—or your new 3PL—should, too.
Double brokering freight is on the rise—act accordingly
Double brokering is a festering scourge in the industry, and it’s clear something needs to change. Our government agencies need to put regulations in place that protect both shippers and the honest brokers and carriers who serve them.
This isn’t a victimless crime. Everyone loses when freight is stolen, and these losses ultimately filter down to the end customer in the form of price hikes.
The good news? While we’re waiting on the federal government to take serious action, there are exceptional tools on the market that can help us all identify trusted carriers—tools that can help those of us that are ever-mindful to dot our Is and cross our Ts.