Rogue household goods carriers target of FMCSA rule, legislative oversight

| Wednesday, June 11, 2003

The Federal Motor Carrier Safety Administration July 9 issued an interim final rule specifying how interstate household goods carriers and brokers must assist their customers shipping household goods.

"This rule promotes fair dealing by movers and provides consumers with the necessary information to make educated decisions about moving their belongings across state lines," FMCSA Administrator-Designate Annette M. Sandberg said. 

Testifying June 10 before the Senate Committee on Commerce, Science & Transportation, Sandberg said state attorneys general should have authority to enforce federal regulations applying to household goods carriers.

"If a carrier gives false information, or there's a situation where goods are held hostage, (the state attorney general) should have the ability to enforce federal statutes," she said. Sandberg said she didn't know whether there was a legal precedent for this.

Meanwhile, Sen. Gordon Smith, R-OR, cited an incident in his youth where his family's goods were held hostage – the practice of "rogue" movers who refuse to deliver unless the consumer pays an inflated price. In Smith's case, his father got results by calling the old Interstate Commerce Commission.

"People could go to the old ICC, but in 1995, the household goods regulations were transferred to DOT – but the agency has been indifferent to consumer enforcement issues," Smith said. "FMCSA is asking Congress for more funds (to oversee household goods carriers). I think this should be the subject of a new hearing – I've had too many complaints from people who say they've moved to my state and have been ripped off. The industry is full of corruption."

The FMCSA rule

The rule requires interstate carriers to provide written estimates, have an arbitration program for individual shippers, deliver goods on agreed upon dates, publish truthful ads containing their name and DOT number, and weigh shipments of customers given non-binding cost estimates.

Household goods brokers will be subject to the same advertising requirements as movers, and movers will be bound by the estimates of brokers with whom they have written agreements.

Under the rule, the most a carrier may demand is 100 percent of a binding estimate before delivery or 110 percent of a non-binding estimate at the time of delivery. If a mover determines additional services are necessary to properly service a shipment after the household goods are in transit, the new rule requires that a shipper be informed before the additional services are performed. Consumers must sign a written attachment to the contract if they agree to pay additional service charges. 

Moving companies must also furnish five documents to their prospective shippers before they execute a contract for a shipment of household goods. These five documents are a brochure called "Your Rights and Responsibilities When You Move"; a concise and accurate written estimate of charges; a summary of the mover's arbitration program; the mover's customer complaint and inquiry handling procedure; and the mover's tariff containing rates, rules, regulations, classifications or other provisions that allow shippers to determine the exact rates and services applicable to their shipments.

FMCSA estimates there are approximately 4,000 active HHG carriers in the United States and about 600,000 interstate moves annually. Interstate moves represent 40 percent of all moves that take place annually. The remaining 60 percent represent self-haul, intrastate, corporate and government moves that are not regulated by the federal government or were deregulated by the Interstate Commerce Commission Termination Act of 1995.

The beginning compliance and enforcement date for this interim final rule is March 1, 2004.

--by Dick Larsen, senior editor

Dick Larsen can be reached at dlarsen@landlinemag.com.

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