Is Brokering Moves Illegal?

Hey, my friend. It's Louis Massaro, CEO, Moving Mastery and founder of Moving Sales Academy. Is brokering moves illegal? I've been getting this question a lot lately, so I wanted to address it. Alright, those of you who've watched my previous video on how I almost went to prison for running my moving company, I really got into how I was in the moving business, had offices throughout the country. Then I had long distance trucks running all around the country and I decided to sell the long distance trucks, get into brokering. Long story short, I ended up pleading guilty to felony charges based on running a brokerage business. So the question becomes, is brokering illegal? Right. If you don't know the story, I'm not going to get into it. In this video, you can go ahead and check for the video that says how I almost went to prison for running my moving business. I go through the whole story in there today. I want to address, is brokering moves illegal? And the answer to that question is no. Brokering moves in and of itself is not illegal. But what I want to do is break down some things that you need to be looking at and you need to be concerned about if you're going to be a broker and if you're going to work with brokers. All right, so what I wanted to do is I brought with me a book from Michael Garcia. Michael Garcia is the moving industry's leading interstate moving attorney. He actually wrote this book, Interstate Moving Consumer Protection and Legal Compliance Guide. All right, Michael's a great guy, guy, he knows what he's talking about. And I wanted to read you something out of this book, you know, not only to think about the brokering situation, but, you know, and my story and what happened to me and let that be, you know, kind of a decision factor for you on whether you want to be a broker or continue to be a broker or whether you want to work with a broker. I want to read you some stuff right out of this book so that you can understand, you know, where you're at. Like what, where do you stand if you're going to broker moves? All right, so let me read this to you. It says as the consumers, as the consumer shipper's agent, okay? So as a broker, you're actually an agent for the shipper, the customer, the person that's moving interstate, all right, you're the one that's going to go out and find the mover for them. You're their agent. Okay? Interstate brokers have a legal duty to consumer shippers to act in good faith and issue Honest and accurate estimates. Interstate brokers can and are held civilly and criminally liable for the following, Number one, Failing to clearly describe and represent their services as an interstate broker. Okay? This was part of what caused me to get in trouble. All right? When we first became a broker, we were also a moving company, right? I also had locations throughout the country, local moving companies. So my website had pictures of trucks all over. Real trucks that we owned. Talked about us doing moves, because we did. But our interstate page talked about us being a broker, but that wasn't enough, right? Because consumers were confused because when they went to the site, they saw that we had trucks, they saw that we talked about being moved. They even saw pictures of our movers. And that's part of the reason that I ended up getting in trouble for being a broker. All right? So that's really important that you disclose that to the customers, all right? If you're going to be a broker or if you're working with brokers, okay? Because remember something, even if you're not the broker, if you're the carrier and your broker is not complying with the law, it's going to fall on you, all right? So it's just as important that as a carrier, you understand what should be getting done legally to make sure you're protected as well. So you want to make sure that you're definitely clearly stating that you are a broker. What we ended up doing was creating a whole nother website, even created a whole nother brand that was never associated with my old brand. So that there was no confusion at all about us being a broker. Right? The new website had no pictures of trucks, no pictures of movers. Every single page said, we're a broker, we're a broker, we're a broker. Whereas the old site, because we were a moving company also, there was confusion, all right? So it's not enough to say, hey, well, on my interstate page, I talk about being a broker. I'm living proof that that's not enough. All right? You have to clearly make sure your customers know that you're a broker. All right? Number two, failing to obtain an interstate license prior to conducting business. You must have a broker license before you broker any moves. Failing to secure and file a $75,000 certi bond with FMCSA. You have to get a certi bond at 75,000. You don't pay 75,000, but you must get the certi bond so that you're legal brokering a shipment to unlicensed motor carrier. You need to vet everybody that you do business with. All right? As part of being a broker, that's the most difficult part. You're essential. You know, we spent a lot of time policing carriers, doing background checks, trying to figure out, you know, when somebody applied, were they a carrier that we at one point blackballed and we didn't let them in. Our company anymore that's now has another company in someone else's name and now they're trying to reapply to be part of our network. You need to make sure that A, they're licensed and B, they're going to do a good job. If you're a broker, okay. Failing to provide potential consumer shippers with a complete listing of all the motor carriers in your broker network, all right? As part of being a broker, you must give every single customer a list of every carrier that's in your network, all right? So whether that's electronically, through email, whether you mail it to them, whether you give it to them, if you do an on site estimate, you have to give them a list of every carrier that's in your network, all right? Failing to provide consumer shippers with the booklet rights and responsibilities. When you move. This is whether you're a broker or whether you're a carrier. They need to get a copy of that. You could do that digitally as well. You could send them a PDF of that. Number seven, failing to provide a written estimate for services based upon the motor carrier's published tariff. This is something that I know there's a lot of people not doing okay. As a broker, you have to know who you're giving that move to at the time of booking it, and you have to book it on their tariff, okay? So if you don't know what a tariff is and you're a broker, get this book. Because it's a problem if you don't know what a tariff is. If you're an interstate carrier or a broker and you don't know what a tariff is, you need to get this book. I'm not going to explain it. I'll put a link down below where you can get a copy of this, all right? You have to book every job on that particular carrier's tariff, right? So for us, if we knew it was on the east coast in a certain area and a certain carrier was going to be handling it, we would book it on their tariff, all right? Using their rates, their information. Because as a broker, all you are is essentially, you know, a booking agent. I don't know if that's technically correct, but you know, you're you work for the carrier, the carrier doesn't work for the broker. A lot of times, you know, there's a misconception there, thinking that the carrier kind of works for the broker, but really the broker's booking moves for the carrier on the carrier's tariff. Very important. All right? Failing to maintain a master list of brokered transactions, you have to, you know, keep a master list of everything from all your customers, all the deposits you took, all the financial transactions back and forth between you and the carriers. You have to have a list of that as well. All right? Failing to have A properly signed 409 agreement with each licensed motor carrier in your network. 409 agreement is essentially a broker agreement between the carrier and the broker that has all of your terms. It's a contract, right, Between a broker and a carrier. You must have one with every carrier that you work with. Again, these are things that brokers can be held civilly and criminally liable for. All right, so these are very important. Let's see. Failing to provide consumer shippers with written notice of deposit, refund and cancellation policies. It needs to be very clear what your refund policy is, what your cancellation policy is, and it needs to be spelled out for them. So, you know, for us, we had. They could cancel up until seven days prior to the move. All right, that needs to be in writing in the terms and conditions when they book their move. Very clearly. And number 11, conducting business, evidencing a pattern of fraudulent estimates called lowballing. All right, this is another reason where we got in trouble. We weren't necessarily giving lowball estimates, but we were giving moves to carriers that were raising the price on those moves. So when they raised the price on those moves, our estimates look like low ball estimates. Right. Wasn't our intention. We weren't purposely doing it, but it doesn't matter. Right? That's why you have to really police everything that's going on. You know, we could sit all day and say we weren't given any low ball estimates, but if the price went up, then the estimate you gave was low to the consumer. That's a low ball estimate. All right, so if there's a pattern of that, again, these are reasons that as a broker, you could be held civilly and criminally liable. All right, there's a lot more to it in here about brokers. There's everything you need to know about interstate moving in here. I'll put a link below where you guys can get a copy of this. I suggest that if you do any type of Interstate moving, whether it's broke, whether you're a broker or a carrier, that you definitely look into this. Listen, you need to know the law, period. You need to obey the law. I know that sounds like common sense, but you need to go through this thing with a fine tooth comb. All right? Highlight it, mark it, check off what else, circle what you need to do. Make sure you're following every single guideline. It's not a joke, all right? You guys know my story. I mean, I literally had to plead guilty to, you know, fraud felony charges from being a broker. All right? It's not a joke, all right? So if you're gonna be a broker or if you're gonna work with brokers, make sure things are getting done correctly, all right? I can't say it enough, I can't stress it enough. If you haven't seen the other video, it's called How I Almost Went to Prison for Running My Moving Business. Go watch that. I explained the whole story. I hope this was helpful until I see you next week. Go out there every single day and profit in your business and thrive in your life. I'll see you later. Hey, my friend, it's Louis. I hope you enjoyed this episode. Do me two favors. Number one, subscribe to this channel so that you continue to get updates every time I release new training for you. And number two, if you'd like to get ahead a little bit faster and become more profitable in your business, what I'd like to do is give you a copy of my 10 rules of a profitable moving company. These are the same 10 rules that I applied in my business that helped me grow it into a multi million dollar nationwide company. Okay? So all you need to do is click on the link on this page or head over to LewisMassaro.com 10rules. So that's Louis. L O U I S Massaro. M A S S A-R-O.com forward slash 10rules. Just put in your name and email address and I'll email you out a copy. Okay? Until then, every single day, go out and profit in business and thrive in life. I'll see you later.