The Federal Motor Carrier Safety Administration will host next month an informal roundtable discussion about property broker’s and freight forwarder’s ability to meet their payment obligations to carriers.
According to the FMCSA, there have been numerous complaints filed pertaining to broker bond providers, and multiple entities have looked to the FMCSA for guidance regarding the procedures with the insolvency or financial failure of a broker.
The meeting will be held Friday, May 20 from 9:30 a.m. to 4:30 p.m. at the U.S. Department of Transportation’s Media Center in Washington, D.C., and it will be open to the public.
Brokers and freight forwarders are required to have either a BMC-84 Surety Bond or a BMC-85 trust fund of at least $75,000 on file with the FMCSA in order to obtain operating authority, and the agency says it wants to make sure shippers and motor carriers can collect payments from brokers, even with the new bonds requirement in place. FMCSA says it believes this roundtable meeting will help it gather critical information on how to best meet its responsibilities.
FMCSA says it’s looking for information from carriers and shippers that have experienced challenges receiving compensation for claims against freight forwarders and brokers due to insufficient funds.
The agency gave a list of questions in the notice announcing the meeting that the meeting will center around, which are as follows:
Which, if any, trust fund holders routinely deny claims made by shippers and carriers against those trust funds?
What is the nature of the assets that are being held in broker’s or freight forwarder’s trust fund agreements, and what is the most desirable composition of the assets?
Aside from FMCSA, are trust fund filers being regulated by any other government entity? If so, what’s the nature of their regulation by state or other authorities?
What can FMCSA do to ensure that motor carriers and shippers are able to collect on these trust funds where legitimate claims are filed with the financial institution?
Should the FMCSA act to address potential issues association with the solvency of the trust funds?
Should FMCSA require brokers and freight forwarders to demonstrate the creditworthiness of the institutions the brokers or freight forwarders intend to execute a trust fund?
For those unable to attend the meeting, comments may be submitted up to seven days before the meeting at this link.