Property broker group sues DOT, FMCSA over $75,000 bond security guidance
The suit calls the new bond amount “arbitrary and unreasonable,” and said it requires AIPBA members to comply with the new amount “or be stripped of their livelihood,” which constitutes “a deprivation of a property right without substantive due process.”
The Trucker Staff
The Association of Independent Property Brokers and Agents has filed suit against DOT and FMCSA claiming that the $75,000 financial security portion of FMCSA’s recent guidance governing broker authority is, among other things, an unlawful violation of AIPBA’s “substantive due process rights under the 5th amendment.”
The suit was filed in the U.S. District Court in the Middle District of Florida, Ocala Division.
It calls the new bond amount “arbitrary and unreasonable,” and said it requires AIPBA members to comply with the new amount “or be stripped of their livelihood,” which constitutes “a deprivation of a property right without substantive due process.”
It also stated that increasing the bond amount would have no effect on curbing fraudulent broker practices.
The Federal Motor Carrier Safety Administration Sept. 13 announced its guidance requiring registration to obtain broker or freight forwarder authority.
Section 32915 of MAP-21 requires anyone acting as a broker or a freight forwarder and subject to FMCSA jurisdiction, including motor carriers, “to register and obtain broker or freight forwarder authority from FMCSA.”
Section 32918 amended the financial security portion (a minimum $75,000 financial security requirement) and created new requirements for freight forwarders.
As of Oct. 1, FMCSA will mail notifications to all brokers and freight forwarders that have not met the $75,000 minimum financial security requirement. But the agency said it would phase in its enforcement of the broker registration requirements for motor carriers that also broker loads.
FMCSA said it “strongly encourages all motor carriers not to accept loads from unregistered brokers or freight forwarders … .”
In response to the AIPBA suit, the Owner-Operator Independent Drivers Association said that “The bond increase is necessary to put a stop to rogue brokers and scam artists that operate unchecked and leave truckers holding the bag. It won’t hurt all brokers, just the bad ones.”
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