Shut-down carriers reappear reincarnated under new names
Who’s got your goods? Some truck operators shut down by the government for safety violations morph, chameleon-like, into supposedly new companies.
The Federal government recently took the first action to shut down a trucking firm identified as a “chameleon” carrier, under new get-tough regulations. The Federal Motor Carrier Safety Administration (FMCSA) shut down Alabama-based MTI Transportation, after safety investigators determined it was merely a front for a rogue carrier that had been issued out-of-service orders on May 11.
“MTI Transportation continues, in all significant aspects, the operations of BM&L,” said the FMCSA. “MTI Transportation is a disguised reincarnation of BM&L.” MTI operated trucks and drivers previously part of BM&L Transportation, from the same premises, with even the same telephone numbers.
The FMCSA is pursuing an increasing number of truck and bus safety violators, shutting down 10 trucking outfits in 2012. A regulation that took effect May 29 allows the FMCSA to target chameleon or “reincarnated” companies, and stop them from continuing the same practices under a different name.
For a shipper, consigning freight to a carrier that shuts down, whether due to bankruptcy or government order, is a nightmare. Physical possession and even legal ownership of your merchandise can be tied up in a lengthy and costly dispute. So if your logistics department gets some great rates from a new carrier, be sure it’s not a reincarnated chameleon.