Page 20 - ATR 2 2013

“from what i’m seeiNg iN the press aNd heariNg from the small brokers,
they’re claimiNg it’s goiNg to be difficult for them to obtaiN that
boNd. if NothiNg else, that says to me that maybe the surety compaNies

that uNderwrite the boNds will pay a little more atteNtioN to who
they’re writiNg boNds for.”

—prasad shamra, geNeral couNsel
americaN truckiNg associatioNs

to review the sufficiency of the bond play,” the thinking being that brokered you get a crush of business. I think if
amount every five years. freight is brokered freight and anyone you’re doing it regularly, our general
The negotiation originally led to a acting as a broker should be licensed, advice to members has always been,
$100,000 bond amount for brokers and registered and bonded. ‘You probably ought to register and get
was included in the Fighting Fraud in “My board consists of owners of brokerage clearance.’ But if it’s not a
Transportation Act of 2011, which was large carriers, small companies and normal portion of your business and
never passed into law. It was lowered to those in between,” Kidd said. “Some your normal activity, it shouldn’t be.’”
$75,000 in MAP-21. of them have been burned by truck- Jon Samson, executive director of
Sharma said the ATA would have ing companies posing as brokers just the Agricultural and Food Transporters
liked a higher figure, but $75,000 is as much as brokers posing as bro- Conference, said that, amidst the
certainly better than $10,000. kers. Kidd pointed out that MAP-21 flurry of negotiations over MAP-21, his
“From what I’m seeing in the press was passed with overwhelming sup- group incorrectly believed that the law
and hearing from the small brokers, port from both parties in a divided would not require carriers to register
they’re claiming it’s going to be diffi- Congress. as brokers. His membership was taken
cult for them to obtain that bond,” he “In some cases, regulations make by surprise when insurance companies
said. “If nothing else, that says to me sense, and as it relates to protect- and large carriers began warning of the
that maybe the surety companies that ing freight and making sure that the change. Now they are mobilizing to
underwrite the bonds will pay a little responsible parties for handling freight alter the law.
more attention to who they’re writing are registered and bonded, it makes Samson said even the $75,000
bonds for.” sense to our leadership, and so that’s bond is too small to protect carri-
The American Trucking where we’ll be,” he said. ers in an age when many loads can
Associations’ Intermodal Motor Curtis Whalen, executive direc- be worth far more than that. Many
Carriers Conference and Agricultural tor of the Intermodal Motor Carriers of his members would prefer brokers
and Food Transporters Conference and Conference disagreed, saying that post a $500,000 bond. Moreover, car-
about 30 state associations want to carriers subcontracting freight is a riers should not be treated like brokers
repeal the broker provision in MAP-21. longstanding practice that is neces- because a carrier, unlike a broker, has
The Arkansas Trucking sary for his member carriers. Working assets that can be obtained through
Association’s board of directors voted with ports involves irregular sched- the criminal justice system when
to support the broker provision, though ules where ships arrive at varying fraudulent activity occurs, he said.
it asked for a relaxation in the require- times with more containers than a “The originating reason for the
ment that every bill of lading list the single carrier can sometimes unload. whole purpose of the language was
carrier under whose authority the Moreover, there are financial penalties fighting fraud in transportation,”
freight is being shipped. Some carriers, for failing to unload freight in a timely Samson said. “They want to make sure
particularly package deliverers, expect manner. that whatever is passed in law is actual-
that requirement to be cumbersome. Such “interchanges of conve- ly fighting fraud in transportation and
Lane Kidd, president of the nience” are nothing like what a broker not overly burdening or restricting the
Arkansas Trucking Association, said does, he said. way that a lot of these small and mid-
the board was presented the informa- “A broker does it every day,” size carriers work. So that’s kind of the
tion on the provision and then voted Whalen said. “It’s his business. end goal that we’re trying to get to.”
unanimously to support it. The com- Whereas we do it only in semi-unfore-
ment made was, “You need to pay to seen circumstances, when, as I said,

20 arkansas Trucking rePorT | issue 2 2013