Introduction
It is 2025 and I think we all understand what a broker function is no matter what industry the name falls into but if you are new to transportation and logistics… it’s still the same. A Freight Broker, Property Broker or Transportation Broker is a middle entity that represents a shipper and connects a transport line to transport a shipper’s freight from an origin to destination making a profit. It is entry level- meaning there is little requirements and the cost to enter and maintain are very low to operate as a Broker. In fact, I can recall during the COVID 19 pandemic, because of layoffs and shutdowns, social media influencers or educators would use their platform to encourage their followers or market themselves educating entrepreneurship creating more multiple streams of income. And you guessed it. “How to Become a Freight Broker” was floating all online and everybody was a broker. The FMCSA has little requirements and vetting applicants in the process is low while obtaining an operating authority. In the words of Anne Reinke President of the TIA (Transportation Intermediaries Associations) “The FMCSA is passing out authorities like candy on Halloween”.
Trucking is a trillion-dollar industry with a lot of opportunities, whether you enter as a 2PL,3PL,4PL all the way down to a dispatching service. An AI overview stated, in 2023, transportation services (including for-hire, in-house, and household transportation) contributed $1.8 trillion, or 6.5%, to the U.S. Gross Domestic Product (GDP), which was $28.2 trillion. Many people from different walks of life travel across the globe to come to the United States of America with a new start in the pursuit of the “American Dream”. In my opinion, trucking and logistics is a highly preferred choice for a career and a startup business because of the many ways of getting your hands on the slice of pie. While many individuals have good intentions unfortunately there are those who do not.
Nevertheless, while the opportunities are present, “We” must be aware and conscience of any suspicion and prepared to prevent any criminal and fraudulent activity in this vastly large industry. Now the question arises: Who is this “We” and “What Criminal Activity”? These are all the participants; from Shippers, Brokers, Carriers, Factoring Companies, Agencies, Phone Companies, Insurance Companies, Tech Companies, Warehouse and Dock Workers, and all the way to the consumer involved in shipping transactions. Criminal Activity such as Cargo Theft, Check Fraud, or Double Brokering. Yes! We all have an obligation to protect our interest.
What Is a Double Broker?
Since this article is about Double Brokering and we have a clear understanding of a freight broker, we need to understand and define a “Double Broker”. A Double Broker is a “potentially” licensed broker by the FMCSA posing as a trucking carrier taking a broker’s freight without His or Her’s knowledge and reselling it to the trucker who is moving the freight, making a profit or taking the total payment of a load. It is very imperative that I highlight “Posing as a Trucking Carrier” and without his or her knowledge because double brokering can be confused with “Co-Brokering”. While the functions are the same, they have two different “intentions”. Co-Brokering is when two brokers come together and agree to assist one’s freight to achieve a shipper’s need. This is legal and the two brokers in this case should follow and practice industry guidelines and standards that are set forth in good faith if this is present. Furthermore, to sum this up, a double broker is just a digital thief waiting on opportunities to steal. Double Brokers snag most of their opportunities from trucking boards: Truckstop.com and DAT.com. Some could slip into the cracks where they are a part of a broker’s carriers list for daily available loads via email or their TMS systems. These crimes are bound to happen and we must be prepared to combat them. Below I will point out ways for each entity on How to Combat Double Brokering.
Shippers
It is your freight that goes into the hands of brokers and you want to utilize brokers that have a strong knitted carrier vetting process. Most shippers before onboarding brokers ask the question “What is Your Vetting Process when sub-contracting?” This is important and should be asked in your carrier questionnaire to get familiar with how your broker is going to handle your freight. Another good question is “What percentage of your freight goes onto load boards?” I hate to play devil’s advocate here because we are a broker and utilize the load boards, and load boards are good because of capacity, but it needs to be minimized. I also notice this question is becoming more common from insurance underwriters because of the great increase in liabilities. I will discuss this more in the broker section in this article, but I believe 95% of double brokering is happening from load boards. Make sure your brokers are vetting their carriers.
When tendering freight, large and medium shippers generate their own BOL’s (Bill of Lading), and the carrier company is listed on the BOL. In this case you would want the broker to be listed. Shippers who are not doing this should list their broker on the BOL and if you don’t have a system to generate BOLs have your broker generate one being very descriptive and use this BOL when the actual transporting carrier arrives to load. The reason why the BOL is so important is because the actual transporting carrier can verify the broker listed for the specified shipment. If the carrier notices a different broker than he has agreed to transport the freight with he should let the site know and contact the broker listed and the broker he has agreed to transport immediately and discuss the discrepancies.
Another way of verifying the actual transporting carrier is having your broker let the shipping site know who the carrier will be beforehand. That is the trucking company and USDOT number, driver’s name, phone number, trailer and tractor number. We have one shipper that requires brokers to enter carrier information (carrier name and DOT#) into their TMS alongside given a driver check in form to have when the truck arrives at the shipping site. From there, when the truck arrives to check in a dock worker looks at the side of the trucking cab to verify if the name and dot# listed is the same in the TMS. If its different, shipper will then notify the broker to verify and will not load the carrier until resolved. The same goes with the check-in form. I like this practice because it has helped strengthen the vetting process. In this case prior to booking broker must ask the dispatch and the driver does the carrier’s name on the rate agreement matches on the side of the truck. If a shipper takes on this method this can be disruptive to a shipper business if the broker does not adopt this practice in its vetting process and freely sends in wrong carriers without verifying.
Finally, shippers should keep their networks to a minimum. Utilize carriers and brokers with strong vetting practices that you have great relationships with. This will minimize having your freight plastered all over the place when dealing with newer brokers with weak practices.
Brokers
Brokers are first in-hand when receiving freight from their shippers and must always take precautions when subcontracting. Whether a shipment is a spot-quote or contract, a carrier capacity strategy should be used to minimize using new carriers. Preferably, your first go to should be carriers that you have a relationship already with. But even if you decide to still use a carrier in your network, the vetting process should be repeated because anything could’ve happened between the last load they hauled from you such as service failures, operating authority revocation, claims, expired insurance, and the list goes on. And if the double broker slips into the cracks where you had no known whereabouts this can be checked! There are many sites to use to monitor carriers such as RMIS, Carrier411, and many more. As stated in the shipper section, Load boards are good and should be minimized but they will be used. When receiving phone calls from carriers off Load boards it’s very important there is a protocol followed. Before pitching any freight, a carrier check should be used internal and external. Check for setups, any internal commentary, external reports, active authorities’, insurance limits, safety scores, and good standing with DOT regulations. Any double brokering reports listed there should result in no more communication and should be notified and recorded. I also like to point out looking at area codes when receiving inbound calls. Post pandemic, our company noticed a large influx of inbound calls whenever a load was posted on the load board and calls from the same area code Glendale, CA. If you are broker reading this then you can relate. Once you notice these atrocious inbound calls, these numbers should be blocked and reported. You should also pay close attention to emails that relate to these area codes, locations, and motor carrier’s numbers and should be blocked as spam. One thing I would like to point out is if you want to book a carrier and feel a little uneased and not too sure, please reach out to the actual truck driver who is going to haul your freight for a casual phone conversation before sending out a rate agreement. A few things to look out for is professionalism, how long it takes to answer phone or if they answered the phone, verifying company name and mc#, accepting tracking. This also helps you determine the quality of the driver.
Tracking is very big and double brokers do not like it. Prior to booking your driver, have them accept tracking immediately. It is 2025 and you have no choice but to keep up with tech and everyone is tracking shipments so do not fall for the okie doke. You will hear “Driver doesn’t know how to accept tracking” Don’t give him the load! Also, if dispatch and driver are very combative about accepting tracking, then you should not use this carrier. Once your driver is on tracking you should always be on the control tower keeping a bird’s eye view on your load. Pay attention to movements and any disruptions in the tracking. If there are any disruptions in the tracking, you should reach out to carrier immediately and have them turn their tracking back on immediately.
Now with all this coming into play driver has accepted tracking and is following instructions, can this still be a double broker situation? Yes. There are some smart double brokers that will provide great communication with you. You must read between the lines. For example, Dispatch might say, “We tell our drivers not to answer the phone because safety is a priority” Now there are trucking companies that do have a no phone policy while their trucks are on the road and respectfully it should be acknowledged. However, it is very important that You press hard to communicate with the driver prior to the load being picked up to prevent this case from happening.
My Load Was Double Broker, Now What?
Your driver never answers the phone, tracking is showing something else or its completely off, dispatch is giving you the run around, a new report it is showing from another broker double broker, please follow these proper steps. First, if the transport carrier is still in-transit, immediately flag your shipment and reach out to management before the freight arrives at its destination. You should immediately reach out to the shipper and request who was the actual carrier that was loaded. If you cannot retrieve this information reach out to the consignee and have them request it when the carrier arrives and all necessary paperwork. Do not contact the carrier or in this case the Double Broker to let them know you caught on to them. Once you get the actual transport carrier information all communication and payments should be routed to the delivering carrier.
Your accounting team should also have a SOP when shipments are flagged as double brokering to halt any payments. Accounting should verify signatures, matching names, and look at any forgery on rate confirmations and POD’s.
Trucking Companies
Trucking companies should be vetting freight brokers just as brokers vet carriers. Looking at credit scores, days to pay, and how long they have been in business will help your decision making not only to see if a broker is legit but your dealings with the broker. Smaller companies or independent truckers are easy prey for double brokers. When you are looking at freight on a load board and see an outrageous rate on a lane, please be cautious or just don’t call. For example, a load of lumber from Tulsa, Oklahoma to Houston, Texas paying $6000. Like really? Come on nah? Also, look out for multiple load postings with the same lane or similar lanes. This is where a double broker is intercepting a freight broker’s freight. Again, please make sure you are screening your brokers and having a casual conversation with your broker.
As I stated earlier in the shipper’s section about Bill of Ladings you want to take a thorough look at the BOL when you arrive at a shipper before loading. Make sure the broker that you have an agreement with is listed on the BOL. If it is not, please reach out to the broker who is listed and get as much information as possible before loading.
Factoring Companies
Factoring companies should also take heed when processing invoices and funding their carriers. They should look at any forgery on documents and anything unusual, especially with a broker that they normally do business with. OTR Solutions has done a fantastic job of doing this. For example, they flagged our company and reported that they seem to see some odd activity with someone using our company name with a Gmail account. To rectify this our accounting team had to call in to process certain orders. Now it may seem a bit tedious, but I understand and applaud the process.
Onboarding Platforms, Loadboards, and Technology Insight
I must tilt my hat and give credit to all industry tech companies that continue to advance their systems to help freight brokers, shippers, and carriers fight fraudulent activity every day. Freight brokers reading this, it is important that you utilize an onboarding system that screens carriers to prevent letting unqualified carriers into your network. There are a few such as RMIS, Highway, and MyCarrier Portal that are very cost-effective and these companies will build a program to accommodate your need so not having one is inexcusable.
For Load boards, they have continued to advance their cyber security in many ways. One example is incorporating a two-step authorization code when logging into their website. Also, DAT has become notorious on sharing user logins and on top of multiple IP addresses being used for a single user. Yes sir, DAT will put a block on your user account.
I’m a fan of new ideas and innovations to help everyone move forward.