Identifying signs of double brokering in the transportation and logistics sectors is crucial. Such practices pose significant risks, potentially damaging both revenue streams and, even more importantly, the reputation of your company.
In fact, according to Truckstop’s chief relationship officer, Brent Hutto, in Q4 2022 and Q1 2023, there has been a 400% increase in double-brokering complaints. “Complaints reflect what is going on in the marketplace,” he said. “This is a constant in our market and sometimes it is worse than others.”
What Is Double Brokering?
But first, let’s discuss exactly what double brokering is.
There are many types of double brokering, but the most common type is when a freight broker or shipper hires a full truckload carrier with a specific MC number, but an entirely different carrier with a different MC number transports the shipment without the customer’s knowledge or approval. Double brokering can lead to scams in the freight market, compromised carrier safety, fraudulent activities, and potential legal issues for all parties involved. It can harm the reputation of legitimate brokers and create disruptions in the supply chain.
Three Tell-Tale Signs of Double Brokerage
Here are three major signs of double brokering.
#1: New Carrier with No Inspection History
Legitimate carriers establish a track record of safety and compliance through regular inspections. Be wary of carriers with less than three months of operating authority and no inspections on their record. This lack of history suggests they might not adhere to industry standards, potentially leading to disruptions and losses.
#2: Missing Driver Contact Information
Transparency is key in logistics. If a carrier doesn't provide driver names or phone numbers, raise an eyebrow. Double brokers often operate anonymously to avoid accountability.
#3: Mismatched Vehicle Identification Numbers (VINs)
A carrier's fleet integrity is crucial. If the VIN provided by the carrier doesn't match vehicle records, it's a major red flag. Especially for single-truck carriers, mismatched VINs could indicate tampering or misrepresentation.
How to Avoid Double Brokering?
Here are some actionable tips to effectively avoid double brokering.
- Tell the carrier that upon pick-up, the customer will confirm the MC and DOT information and call the broker or shipper.
- Implement a strict vetting process.
- Ask for contact information and communicate with your partners.
- Check carrier score on Carrierassure.com before tendering.
- If the carrier has a low score (D or F), take additional vetting measures.
- Report carriers who double broker.
- Check for any complaints with the FMCSA.
These are just a couple of signs that your carrier or broker may be double brokering, but there are many more. It’s essential for companies to be attentive to these signs and put into place additional safety measures to provide quality services to their customers. By doing your due diligence, adopting a proactive approach, and implementing robust vetting procedures, you can significantly reduce your vulnerability to this brokerage scam.
Protect your logistics operation with Carries Assure! With Carrier Assure, you can avoid double brokering as you have visibility on the information you need to hire a carrier with confidence. Don't let deceptive practices disrupt your business. Make informed decisions and build a secure supply chain – start by learning more about the signs of double brokering and ways to avoid them.
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