An Illinois man has been sentenced to three years in prison and a fine of over half a million dollars after he was found guilty of running a double-brokering scheme that cost legitimate trucking companies around $532,000.
The man owned a “trucking company,” Freedom Transportation, which would book loads just like any other company. The only problem was that Freedom didn’t have any trucks. So they would contract with a freight broker to find another company to deliver the load. When it came time to pay the other carrier, they would often leave them hanging without paying a cent. Freedom and the other freight broker would then pocket the money.
According to the Office of Inspector General at the DOT, the scheme ended up costing the carriers who actually hauled the freight around $532,000.
The head of Freedom pled guilty to charges of wire fraud and was sentenced to three years in jail, three years of supervised release, and ordered to pay back the money he owed – all $532,000. The sentencing was lenient because the man cooperated with the authorities and volunteered information about the scheme and his partner.
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Source: gobytrucknews, overdrive, truckingnewsonline, todaystrucking, truckinginfo
JohnS says
Ah, good old trucking and brokers. Let’s all just realize trucking is just legalized crime for many. Its become worse over the years as freight get’s traded and passed around. Everyone gets a piece of the action except for the one’s who actually deliver the freight. I am glad I got out of trucking just recently due to health issues. The rapid decline in this industry is scary bad and the only concern the government has is for more regulations of the truck driver.
pocketchange says
Amen
John D says
Look at Landstar they double broker all the time. Sometimes one agent will even cover a load from another L S agent then put it on the board or calling trucks and cover the load at a lesser rate, making money that way. Also an agent will book a load under Landstar Logistics then broker the load to their own agency and then book a truck. Also LS tries hard to broker the higher revenue loads to outside carriers rather than load a LS truck so they can skim more off the top. I hear guys with their own authority say “I mostly haul for LS” Ask why if they have LS trucks available and willing to haul a load why would they want to broker a load. Maybe $$. No they might say you are much better truckers. I’ve heard that one before, but remember brokers and politicians are alike. So many times when you do broker a load from LS and other carriers like them you’re screwing 3 people yourself, a LS OO. and the shipper because if you are doing the load at a much reduced rate and they could saved money by using a carrier direct.
sherry says
Years ago some of my customers also made the same load to trucklines and I will tell you this: 95% of the time the trucklines always offered it out CHEAPER then we (broker) would ever consider doing.
True.
Also, when I did have my brokerage up for sale, I did have some unhappy agents call. And most of them were LS agents. But never a
penny to their name. However, they had some interesting stories about not getting paid or partially paid on loads in situations they were unfairly blamed for….
John says
HA! Freedom Transportation!!! Love the irony. He’s locked-up like a bird for three years.
Should have called it Con-Haulers
sherry says
The article doesn’t mention what happened to the broker partner.
I just got sold my brokerage of 31 yrs. MC# started with a 1.
Very glad to have a long run with out getting really hurt financially, but I used my gut feelings on carriers especially the last year. I was surprised that the new owners were able to get a discounted bond price due to the fact that I had a good reputation and long service in the industry. So even if they were new—they financially benefited from buying me.
Glad to be retiring, and though I had a wonderful relationship with many good carriers— these last eight years, Ive been not comfortable with drivers who could not read/speak English, too many on drugs, too many lies and too many dispatchers dealing with “helpless drivers”. I have to do far more interrogation on dispatchers to find out where there drivers REALLY were.
And too many trucklines not owning up to the few freight damages I did have.
I guess the coming generation is never as good as the one before. Atleast, we were told…..(chuckle)
I know there are still a few bad brokers out there, but believe me it still works both ways.
Rambo1 says
Millions of Aliens from all over the Globe whose Parent Countries have little or no concerns for their citizens cultivate these sub culture beings who were taught that anything not nailed down is theirs. With the ” drunk with power
Politicos ” who operate a vastly illegal and immoral ” vote buying ” schemes to keep themselves and their Parties in power do not remotely realize how they are destroying our culture and our Country !
Infosaur says
Just think, if he’d have bought and plated a salvaged truck ($10k? 5k?) and had ONE employee with a CDL nobody would have ever suspected.
For want of spending $12,000 the company lost half a mill.
Yup, that sounds like your average MBA these days.