Freight 360

Avoiding Fraud Carriers | Episode 290

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In this episode of Freight 360, the hosts break down freight brokering basics with a focus on carrier selection and fraud prevention. They cover how the current economy affects the industry, share a global outlook, and dive into a real case of identity theft. Key takeaways include best practices for vetting carriers, staying ahead of fraud tactics, and the value of training and education in spotting red flags.

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Speaker 1:

All right, welcome back for a in-person episode of the Freight 360 podcast. Here we're at episode 290, and we're going to do a little bit more of the basics of freight brokering in today's show. We've had some instances recently in both of our companies where we've had some either poor carrier selection or poor vetting things of that nature. So we'll talk through some ways to protect yourself, prevent these issues from happening inside of your company. But first, if you're brand new, make sure to check out all of our other content at Freight360.net and on YouTube and across social. You'll find the Freight Broker Basics course on our website as well. If you're looking for an educational option, Share us with your friends. Leave the five-star review. Leave comments. All that good stuff. Ben, I would ask you how Florida is, but I'm hanging out with you.

Speaker 2:

I know it's nice being here in person.

Speaker 1:

Yeah Well, a little sports real quick here. What do you think about Rory man Just closing it out on Sunday?

Speaker 2:

That man just closing it out on Sunday. That was the best man. Grand slam. That was the best masters I've watched since Tiger in 2019 and probably since the early 2000s. Yeah, like one, it was great. I'm glad to see he won and second, like how he won. Like I even hesitate to say I'm glad to see how he won because I mean he definitely gave Justin Rose every opportunity to win that.

Speaker 1:

Yeah, the fact that it went to a playoff hole in general was wild, just because he missed a putt. And it was a short putt, it was like a three-footer. Very happy that he finally pulled it off. He did the job. Yeah, yeah. So he's got the Grand Slam, he's got all four majors on his belt now Up in Pittsburgh.

Speaker 2:

He's coming up this year, so the US Open is going to be at Oakmont, nice. I'd love to be able to see Rory take a US Open. I mean he's playing really good golf. He's definitely shown the fact that like he's I hesitate to say choked when it really matters. But I mean he did last year and he's done it a number of times. So I'm really hoping he can kind of keep it together through the US Open.

Speaker 1:

Yeah, we'll see. It's a long season ahead In news there seems to be. You know, I feel like I downplayed it on last week's episode. I was like there's really nothing to talk about, and you're like, except for the fact that the entire economy is falling apart.

Speaker 2:

Collapsing on itself. The and the entire world is negotiating against the United States to restructure the entire global supply chain and cut us out of it.

Speaker 1:

Yeah, I mean, besides that and the fact that, like there was pause on these tariffs, though, like the majority of them, he definitely paused, but that means nothing because no company can actually predict or make decisions into the future.

Speaker 2:

So no one's buying anything, nobody wants to put orders in, nobody's going to build manufacturing facilities and the things that were in place whether you like, the Biden administration or not, like the CHIPS Act was meant to be able to restructure manufacturing of those things in the United States, and he threw that out the window. And he's absolutely no guidance on whether or not they're actually going to incentivize manufacturing in the United States. And he threw that out the window and he's absolutely no guidance on whether or not they're actually going to incentivize manufacturing in the United States. And here's a crazier stat that I listened to this morning is that they pulled Americans on manufacturing jobs and something like 75% of Americans said, yeah, all this stuff should be made in America. Then they asked them a second question Would you go work in a factory? And 80% of those people said yeah, I wouldn't, but somebody else should.

Speaker 2:

And on top of that, the people that want to come into the country through immigration to take those jobs, we're now sending them to other countries. So there's absolutely no thought, no plan, no guidance, no even from like an elementary point of view to figure out, like, if you want to bring these jobs in, who's going to do them? Because the entire country has basically said we don't want them. We've moved away from these jobs, and not only do we not want to work in a manufacturing facility, we don't even want to go to an office, we want to work from home and we don't even want to go to an office to do an office job anymore. That's how far our country's moved away from going to a factory and sewing shoes together. But somehow this administration thinks this genius idea of getting people to do jobs that no one will do in a first world country is all of a sudden going to happen.

Speaker 1:

But hey, you know, we'll see. I think if you pay people enough money, you can incentivize them, but it depends.

Speaker 2:

Well, there's the problem Pay people enough. So if you're going to an office job and making sixty five to seventy five grand a year, how much do you think a shirt would cost if we're buying it for?

Speaker 1:

three, I guess. I guess you have to increase your efficiency and reduce your headcount. I don't. I don't have an answer to that. What I will say is this right Whenever there's crazy stuff going on, these are great opportunities to get on the phone with potential customers and existing customers to talk about the impacts of how it's affecting their business, what it might mean for you know, the ripple effects later in the year and obviously no one knows what's going to happen. It's the question of like is this a game of poker right now? Or is you know? Is this a bark with a bite that's going to come with it? Who actually knows? But it's good, good opportunity to have conversations.

Speaker 2:

Agreed, and I think the only argument from that side of things that I agree with is like you can't negotiate without leverage, so you can't tell people when you're willing to give up in order to get what you're trying to get at the end of the day, which I agree in premise right. But to be honest, I'm going to start learning how to broker freight in India or Europe pretty soon, because who the hell knows if we're going to buy anything in the United States anytime soon.

Speaker 1:

You know what's wild is I actually? So I went down like a rabbit hole maybe a month or two ago about how freight brokering in Europe works, and I don't. I don't remember it specifically, but it's an industry over there too and it's kind of managed country by country and very, very loosely regulated in comparison to how it is in the United States.

Speaker 2:

So I had a really good conversation with Dean at DAT about India.

Speaker 2:

He was there earlier this year, and he was, like the industry and freight brokerage in India operates very similar to the United States in the 80s.

Speaker 2:

Like there's literally telephone books and like you just call through it until you find a truck to pick up your goods and you negotiate it the exact same way we did, really, 40 years ago. The problem with that opportunity, though, is in the value it creates, right, because, like, even if you made a% or 40% margin on a shipment in India, with the currency, it equates in the United States to something like 10% of that. So it's like you made $300 and there's opportunity. It's definitely I forget the term green space or wide open opportunity to be able to bring technology in there. He had said, however, like, theoretically, if you moved a hundred or 300 loads a day, like even at 300 bucks a load you had in the United States, you'd end up making like 50 bucks. So like that's the trade-off, but it's an interesting it's an interesting, I think, issue that will be solved, likely by technology, and if you could do that at large enough scale, there's definitely opportunity there.

Speaker 1:

So I forget what country I was looking up in Europe, but they use load boards, just like we used DAT, so I thought that was pretty interesting. Anyway, not to go down a rabbit hole, we're going to talk about some um basics of, uh, carrier selection and fraud. Um, this stuff has been going on for three years now. It feels like like this the rampant double brokering, uh, and what's crazy is like there are at this point now, within, like on my team I have plenty of people that never existed in this industry before.

Speaker 1:

That started, before, like, the craziness of a fraud went haywire. So, like, trying to explain to them how things used to be versus how it is now is like it's becoming a distant memory at this point of what it was like. Environment that we're operating in now is is one in which, um, if you're not taking like it feels like three, four steps to ensure that, um, you know you've got the right person, the right place at the right time and, you know, with the right intention, um, you're, you know you're exposed, like, for example, uh, stolen cargo is like, let's start with that. You, you want to talk about the one that you were dealing with most recently.

Speaker 2:

Yeah, so we had a client, okay, that reached out to us about a stolen load that I was helping them work through, and here's how the load was booked and here's how it's played out literally till this morning. I was just on the phone with the crossstalk and the broker at this company this morning working through this. So, and I'll tell you who the company is mostly, just because I want everyone to be aware for how this company is. Basically, they're not being defrauded, they're being impersonated. Yeah, that was the word I was looking for. Saw identity. So the company was Orozco Trucking and they're a pretty big company and, honestly, like most of the brokers of this company and our company have used them. There's no issue with that company. There's no flags, there's no okay, there's nothing legitimate or illegitimate about that company. Yeah, but they've been impersonated.

Speaker 1:

Yep.

Speaker 2:

Someone stole their identity Right and if you look them up on Highway, you'll see. I think there were four warnings in 2024 that I had seen where somebody created a Gmail address where, instead of it being and this is what's important the company domain right. So they were Gmails that were created that were like OrozcoTrucking at Gmail or RatesOrozcoTrucking at Gmail and, to be honest, like I might pull it up on my laptop to read literally what the insights were. But how they actually stole this load was a criminal organization created a domain that was exactly like OrozcoTrucking, like the spelling is identical except for the I, and I don't know exactly what language it's in. But I went and found the domain the I is an I in a different language. So instead of it being a dot or like a little line, like you see in any text message, it's like a little bit of a slant. It's not a line like this, like. It's a little bit of like a I don't know like a horizontal.

Speaker 1:

Yeah, you see it like in the. You know French and other languages where they've got. You know the accent a goo and other various. You know you got little symbols that go above letters, right.

Speaker 2:

So if you copy the domain out of the email address of the dispatcher that was talking to this broker and you just put it into your browser, right, it comes up and you can see it's a domain and it's owned by somebody, but there's no website there. It shows you know this domain is owned. If you want to buy it, you can reach out to us, right, so you know that somebody has this domain, created it and could likely have email addresses. And that's the important thing For anybody that doesn't understand this right, when you own a domain, then you have the ability and the login credentials to create email addresses for that domain.

Speaker 1:

Let me ask you this real quick Did Orozco know that their identity was stolen before this happened? Yes, Because. My first thought is why did they or no one else put an alert up on highway? There is an alert.

Speaker 2:

There is, but there's an alert. And here's the thing the interesting. I'm going to pull up and I'll read the alert. But the alert says that like and it's kind of ambiguous and like you wouldn't know, this is what the alerts related to, unless you know how this happened. So, for instance, it says I booked a load at and this is a verified email rates at Roscoe Trucking. And this is what the insight said and I'll read it for you as soon as I get this up. And they said I spoke to the owner of Roscoe Trucking and they said they are not involved. And then the alert says in there, from the broker that had a load stolen I think it's 2024, and I'll pull this up it says contact them, basically at the verified phone number to make sure you're booking a load with Orozco Trucking. Yep, I'm logging in right now.

Speaker 1:

Yeah, I mean, while you're doing that, I'll just point out a couple of things. While you're doing that, I'll just put out a couple of things. The takeaway and some of the best practices here is when you see well, first of all, even if you don't see an alert about identity theft on a carrier vending site like a highway, it is very important that either whoever's onboarding the carrier or booking the carrier or dealing with that carrier in any way, shape or form, that they're verifying that at a minimum right, whether it's highway verified contact or FMCSA's registration information phone number. If in doubt, call the phone number that's registered and talk to whatever it is the email address associated with it as well.

Speaker 2:

Well, to that point, the thing you want to do is, if you have, like my carrier packets, for example, right, my carrier packets will show you the name changes in the FMCSA, so you don't want to call the most recent one, you want to call the oldest phone number, because that one is going to get you likely to the owner. Like every time I've ever worked, through or you'll find out.

Speaker 1:

It's the previous owner. Yes, hey, we sold it to so-and-so, exactly.

Speaker 2:

And then you work your way back through that right.

Speaker 1:

But I mean, this is the stuff. You'll see. We had one. We had Well, we're still dealing with it right now at our company.

Speaker 1:

But we had one recently where the carrier, so a load got stolen and the carrier is claiming that their email server got hacked because the the email was verified through highway, everything was legitimate, the domain was correct, the email address was, everything was good to go. And then we're sitting there thinking is this carrier just trying to scam us and claim that their identity was stolen and they just sold the freight themselves? Or was their identity actually stolen, their email hacked and someone had access to their email, and you know? So immediately we start putting up alerts on them until we can get to the bottom of it. They were able to verify with the police and everything, and police reports that someone did hack in and was impersonating them on their actual email address. But how could this have been prevented? Well, you know, had we called that phone number, um, it would have done the you solve the problem.

Speaker 1:

But here's here's the problem. It's like they passed every rule in highway and the email address was verified. So it's kind of like, where do you draw the line? Do you? Every carrier that you onboard, are you going to call that phone number to verify that it's, that that's who it who it is and it's the right person? That's a decision that you need to make at your own brokerage, right. There's not, like a um, a best practice that will fit every single brokerage, because if you've got a company like tql that's got thousands of brokers and they're onboarding probably you know 500, maybe over a thousand carriers a day, I have no idea what that would look like Versus if it's just you and you're getting started off and maybe you're onboarding two a day, right.

Speaker 2:

And if you're onboarding a couple of day, not a big deal, probably worth it to make those phone calls. Well, and here's the thing that I've learned is that, like if you have just the regular highway, it definitely has unverified phone numbers. And the reason for that because I dug into this too they use multi-factor authentication. Ironically, what I'm doing right now to get into Highway right Like into my computer- Putting your email address sends you a code?

Speaker 2:

Yeah, it sent me a code. It sent it to my phone from my laptop to make sure that this is me and to make sure that I'm the person that they think they're talking to, right? So Highway does that for carriers, but they do not do it repetitively, meaning like they do it at onboarding for a trucking company. But if Nate owns a trucking company and Nate gives me his login, it doesn't ask me the second time, which means the MFA that verifies you with a photo, with your ID in real time and connects to your bank account only happens at onboarding, does not happen over and over again. And they said they're working on that but is not there yet.

Speaker 1:

Yeah, I was going to say, like whenever, like as a broker login on highway, I feel like every time I switch IP addresses, networks, whatever I get prompted, or just periodically, right, like if I'm just at home, like maybe every couple of days or whatnot. Steven said DAT talked about this. Oh yeah, when you were interviewing Kerry. Yes, from Trucker Tools and the CEO. So, yeah, it's, this is. I mean, I know, when we had the marketing guy, was it the marketing guy from DAT that was on last year Talking about upcoming things that they're going to implement with multi-factor authentication and whatnot?

Speaker 1:

Either way, the big takeaway here is that the bad guys they're learning and evolving, right. They're like, oh, you guys are going to do this. Well, now we got to find a way to beat that. And then, once they find a way to beat that, we have to find a new fix, and then they're going to figure out a way to beat that. So we always have to try and stay two steps ahead. That's why I'm all for. You might be good with just checking on one system, but if you can do a couple extra steps, you can do a couple extra steps. You can prevent the headaches here. Um, did you get the?

Speaker 2:

I'm looking up the MC cause there's a lot of them. I'm going to actually ask this broker right now.

Speaker 1:

So another takeaway that I'll add in here too. This is back to the story with with my team Um uh, like I said, we put some flags up on Watchdog Highway, etc. That we thought this carrier had stolen our cargo. Once we verified that the carrier had their identity stolen, we corrected everything. With those reports. I want to point out a bad review on Google or a negative report on highway. If circumstances or information changes it, I find it very appropriate to go ahead and make those changes as well, because you don't want to. You don't want to carry who's victim of something, to be the one paying the penalty for, for the bad guy.

Speaker 2:

So here's the carrier and here's the MC. Again, this MC is clean and this trucking company did nothing wrong. Again, somebody is impersonating them, but it's Orozco Trucking, o-r-o-z-c-o Trucking and the MC is 681958. Now here is the highway alert. It says Now here is the highway alert. It says book load with Alex VoIP phone number driver. David VoIP phone driver, tracked on MacroPoint, likely falsified. So if you're using MacroPoint, realize that like criminals can hack that system and impersonate something so you might look like it might look like a driver's tracking, and they aren't. Then it says Alex sent another driver to pick up the load at 10 pm. Driver info not given. Driver took the load to an alternative warehouse where it was transloaded and is now missing and reported stolen.

Speaker 2:

Confirmation was sent to email address and this is the kicker dispatch at aroscotruckingcom. But Arosco denies involvement. They confirm Alex is not an employee or authorized representative. Please contact Arosco with phone number listed at FMCSA to limit fraudulent brokering, right? So again what Nate was saying earlier you call that phone number.

Speaker 2:

But we found out how that happened because that person likely looked at that email address and said, yeah, visually it looks like OrozcoTruckingcom, but the load that was stolen from the client we were working with it's that I. It's not an English I. It's a domain that has a different language, with the eye that has a little bit of a line at the top instead of a dot. So even this person in Q2 of 2004 had a load stolen from what they thought was a legitimate domain. And the only way you would have found this and this is what's important like to the human eye, like it is almost imperceptible, you would have had to copy that email address or just the domain, put it into your browser to see it doesn't go to their website, because if you copy the real RoscoeTruckingDomaincom, it goes directly to a legitimate company and you can see and I did this in two different browsers, you can see the fake one and the real one goes to the real company's address.

Speaker 1:

I believe Highway released last year an email plugin that can verify the email. It'll check it for you, and something like that will catch those. Here's the thing, though. Like back to my other point, it is a decision that you have to make at your level of. Is the process, the time and the cost? Is there a balance out with my risk tolerance? Basically, is what it comes down to. So and that's going to look different for everybody Large companies with a lot of brokers, a lot of young brokers they're going to spend a lot of money for technology and have, you know, second and third level layers of protection to prevent these things from happening. And one other thing to add in too when it comes to your process, you have to decide who is going to onboard carriers. Are you going to let your brokers onboard their own carriers? Are you going to have a compliance team who are the experts and know what to look out for? Onboard your carriers? Is it going to be a mix of both? Again, decision that you've got to make at your company.

Speaker 2:

Well, here's what's important. Right Two to Nate's point. Right One is like there's always a risk tolerance and not like and again I want to point out, this carrier has no issues with them. They got 482 trucks and, like I've used this company. I know lots of brokers that have like, there's nothing wrong with this trucking company. But that's what criminals look for. They look for a legitimate company that everybody's comfortable with, you've booked a lot of loads with, and then they find a way to be able to convince you to not go through the processes Nate's talking about, to just go oh yeah, I know that MC, I know that company just send them the information. And then here's what's meant to work and here's what doesn't work. And here's why what I found in just this scenario right so my carrier packets has verified email addresses in there. Right, so does RMIS. So does Highway.

Speaker 2:

Highway to Nate's point has an integration that will plug in to either Gmail or Outlook, that will flag an email address in your inbox so, as you're talking to them, you can see in real time, like this isn't who you think you are and why. This is a really good example to talk through is again to the naked eye. We've talked about this before like they'll put an S in there where it looks close, but if you look close enough you can see it. This is the first one that, even looking closely, you almost cannot tell. And the only way you can tell is if you copied and pasted it to see that the domain was different, because again, to the naked eye like it looks identical. It's just a little bit of a difference, right? So my carrier packets, rmis and Highway have verified emails. Highway has a plugin to your email to see that when you're talking to them. I don't believe RMIS or my carrier packets has it.

Speaker 1:

I'd be willing to bet, though, with the way technology is going, I think you're going to find more and more tools get released or tools that get added features that will help you with things like this, because, I mean, this fraud's not going away, it's just going to keep changing. It's going to look different.

Speaker 2:

And again, like, what I want to point out is what used to work and what doesn't work anymore. Because, again, it's always going to be a give and take. As technology advances and we find ways to protect against what the criminals did yesterday, they're going to find a way, and they're trying to find a way Because if there's money there, they're trying to advance and they're usually at least a half a step ahead of wherever the technology is to protect you. So understanding these processes is really the best way to protect yourself, right? So again, to just go back a second, like, these systems are meant to not allow you to email pickup addresses and pickup numbers to a driver unless you know who you're doing business with, right, the issue I found at least specific to this situation was yes, if I went into my carrier packets, I could see their verified emails, right, and those emails are the only ones that get transitioned to my TMS.

Speaker 2:

Well, it isn't ours, the client's, in this situation, but like you could see that that email address goes over to that carrier profile. However, when you send a Raycon out of the TMS, you can still copy and paste in any email address you want. So if a criminal is convincing enough and they say by email hey man, I don't have access to that email. My boss does just send it here, which, when you're time crunched and you're booking a lot of loads and you don't have a lot of time, you just copy that email address, put it right in your TMS. It'll still send the rate con information, even though you have all of this protection you're paying for on the other side of things I mean, yeah, that you make a great point right there.

Speaker 1:

That's worth noting is like you can have all the best processes and technology and you end around them. Yeah it, it's only as good as is the process how you use it. You know what I mean like. So, for example, like we um, we implemented highways onboarding system about a year ago and you know we've tweaked around to get our rules and our processes to a point that we think is the best possible place that it could be in, right, and we'll change them. As you know, the industry and the operating environment dictates.

Speaker 1:

But we have people that will like argue with us like internal, like brokers, that are like maybe it's a Friday, they're having a bad day and they're in a pinch, and they're just like, well, this is the only guy I can get. And we have to like take a tactical pause and say listen, what is the purpose of us implementing all these processes and this, these safeguards, if you just don't want to use them? And you know, and, and sometimes you have to talk to your team members and you have to draw a line and say sometimes the answer is just going to be no. Unfortunately, nobody wants to say no and we always have a phrase at Pierce that we're flexible enough to bend without breaking. So we'll do everything we can to try and find a way to say yes to our customers, to our carriers, to the brokers in our organization.

Speaker 1:

But there's a line that cannot be crossed with every single one of those parties I just mentioned. Right, if you have to tell a customer no about extending credit, if you have to tell a broker no about onboarding a carrier, if you have to tell a carrier no about onboarding them into your network based on, maybe, csa scores or crash history, whatever it might be right, you need to draw a line somewhere and maybe there's that gray area and oftentimes there is a gray area and that gray area might be vast or it might be a very thin gray area, but ultimately there's a no-go land that exists. And I think one of the hard things that managers and leadership have doing is telling no to one of the people on their team because they almost feel like, well, I'm not setting this person up for success if I just prevent them from doing business, but the reality is you are setting them up for success because you're helping them learn and understand, or to draw that line, yeah.

Speaker 2:

And I want to go further down that line right is one we wanted to go through this example to show you and to understand. There are almost, you know, like I'll say it's like I think there are always going to be vulnerabilities that can be exploited, no matter what you do, no matter what you spend Right, and even out of, like the companies that Nate and I have talked to, that build this tech, they will. None of them have said it's 100%. Every single company we've ever talked to that is on the front line of protecting companies will say 99.9, 99.8. We know there's always some non-zero percentage that somebody is going to be able to still get information or steal something from you. We'll get as close to 100, but it's never going to be 100. And it's for what we were talking about earlier right, and I think the biggest thing to point out is what Nate is saying related to processes.

Speaker 2:

I think the best protection against this is to learn how and what is happening. It's education right, because in every instance I've ever looked through every client, every stolen load, any scenario that I've got on and looked at and dug in, I could see it Like I could see it probably within like two or three minutes, like pretty quickly. Like there were scenarios where loads were booked and it was a stolen carrier and I'm like, you booked a reefer. This carrier has one truck listed and it's a flatbed, didn't you see that? Well, no, they don't know how to look at that. Oh hey, you guys book this load. None of their trucks are listed on their insurance, none of their VINs are. Did you ask any more questions? Nope, so the point I think that is really important to get across to anybody listening to this is, like, not just the owner of the company needs to understand, I would say, like the old school way of vetting carriers, but you got to understand what information is where, so that you can train your teams to see the red flags. And I always, like, when I do this with a company, I'm like look, if you see one red flag, look a little deeper. If you see two, you really got to look deeper. If you see three, it's probably better to avoid it, right? Because, like, sometimes, like one red flag is not an issue and sometimes two isn't an issue, sometimes three legitimately isn't, but like now you got to make a couple more phone calls. It slows you down and your teams are all likely at any brokerage out there under the gun to book more loads in less time.

Speaker 2:

Track and trace. The whole industry operates on trying to do more than you ever have time to do. Like that is free brokerage, if I could define it. Like you're always going to have 15 hours of work to do inside of seven to eight hours. So everybody's trying to do more with less.

Speaker 2:

But understanding what systems tell you what, how and why they exist is, I think, the best protection. So, like in these companies, examples like what we do is like we'll go in and like hey, does your frontline know how to look for these things? Even if they can't authorize or approve a carrier, they need to be able to look and understand what the information's telling them right, like are the VINs listed? Are there the legitimate carriers seen? Were there inspections? And again, there's always going to be exclusions.

Speaker 2:

Just because a carrier has no inspections doesn't mean you can't book with them. Maybe they run local freight, maybe they haven't been in business that long or run enough long hauls to have a lot of inspections. That doesn't mean you hold it against them, but take one more step and look a little further and go okay, why might this be the case? Get on the phone, because I think the biggest issue that criminals exploit in our industry is that so much of us are used to talking to people through text message apps, emails, that there's a hesitancy to get on the phone and do like the person-to-person communication. And again, yes, it's faster to book an email, it's faster to book a truck through a text message, it's faster to do it that way. But if you see two or three red flags, you've got to slow down and prioritize protection over speed in those scenarios.

Speaker 1:

Yeah, agreed, 100%. And the other thing I'll add in too is and I alluded to it before is don't be afraid to change your processes and the level of protection you're putting up. For example, you made me think of something when you were running through that, as like one red flag, two red flags, three red flags Remember your carrier, vetting and monitoring programs speak different languages. Right Like Highway might call it one thing, RMS might call it another.

Speaker 2:

They all don't talk to each other as efficient as you think Just because they're connected. I can assure you there are issues in EDIs or in APIs between all of them where some of that data doesn't come through 100% the way we expect it to.

Speaker 1:

Yeah. So think about this right Highway. We talk about a lot. We both use it and have used it in the past Highway has what's called insights. Right, Insights could be neutral. They could potentially be bad bad it just depends on what insight it is. There's a ton of them. Um, for example, one of the uh like one of the rules that we had set is if a, if a carrier has I think it's five or more insights, they're going to require an override right. And what would an insight be? Would be like someone tried to log in from the wrong log into the wrong carrier, wrong MC number. Right Could have been a theme but not on insurance.

Speaker 1:

Yeah, yes, scheduled autos policy, but a VIN number has been seen and is not listed on the cert. Could be an old cert, who knows? Yeah, so brokerage located within or at same address or nearby, right, could be a chance for double broker. Could just be a legitimate company that has both. You've got insights on users in North America, for example, right. So these are all you know. These are just kind of like hey, fyi, but again, you have enough of that. A little deeper, right, you may like what's. What's hilarious? Hilarious is our own trucking company. So Pierce Worldwide Logistics is a brokerage and Warren Pierce Co is the asset authority. Our trucking company doesn't pass our brokerage's rules and we have to override them Because we have reused contact, reused phone number, broker authority, same address, all these things that are like, yeah, I mean they're, they're all legitimate, but to an outsider, like we get, you know, we get our carrier division all the time we'll get calls and they're just.

Speaker 1:

I just want to verify this is going on, one of your trucks not going through your brokerage, correct? And we have no problem having that conversation. We appreciate it because we know that the person we're dealing with takes it seriously, right, the same way that we do so. But again, always refine and make adjustments to your processes. And when you hire somebody new, please, please, please, do not take shortcuts on training them. Do not put them out to the wolves too soon and don't have like the newest guy training the next newest guy, like.

Speaker 1:

A lot of times you'll I've seen teams where, like whoever's the newest has to hire the new guy because it's kind of like you know it's like the crappy job. But the reality is you should be having like whoever's an expert in your TMS, that's who should train somebody on a TMS. Whoever's an expert at carrier selection and carry development, that's who should be teaching that stuff right. Whoever's the best at sales and pipeline management, that's who should be teaching that stuff. If you can right, you don't always have an expert in every little area, but, like you said before, you only got so much time in the day and everyone's trying to take shortcuts and be more efficient. These shortcuts can cost you lots of money. I mean, can you talk numbers on the stolen one that you were referring to before?

Speaker 2:

Okay. So in that scenario here's how it played out, as of right before recording was, they reached back out to the carrier that stole the load and they got the carrier to negotiate. Carrier said we think this load is a hundred grand, we want 10 grand up front. And then they negotiated down to seven and said hey, we'll pay you Cause. Again, from the broker's point of view they're like well, dude, if we give you 10 grand, what's going to assure the fact that you're in, deliver load Right? And they said well, here's pictures of the cargo at the warehouse. And they sent me the photo and I dug into the back end of the photo to see if there was a GPS tag, to see if I could figure out where that photo was taken Some metadata?

Speaker 2:

yeah, and there wasn't. However, here's how it played out. Was the scammer, right, said, hey, pay me half and then half when you pick it up. And then the broker said, ok, and then here's what the scammer says I know what you're thinking. You're going to pay me the call it five grand up front and then screw me on the other five grand. And they said we know your MC, we booked a load with you, we have at least a handful of clean MC trucking companies and if you screw us on the other five grand, we're going to steal your next load, notify your customer and tell you that you booked this negligently and we're going to blow that up.

Speaker 2:

So, like, this is how blackmail, this is how savvy, right, these companies are that like they're aware of how this works and, honestly, like my guess is they're probably former dispatchers and brokers that know how the industry functions, like Nate, and I joke. I'm like dude, we can make a hell of a lot more being criminals. I'm like I know exactly how they're stealing freight. I'm like we could just steal a couple hundred thousand dollars worth of freight in a day, right Like. But at the end of the day, why we're sharing this information is so that you can protect your companies. Because there's one last example I want to explain, and this is the one that I think is the hardest to catch, and I think there's probably only one way you would catch this right. So, another client, another stolen load situation, right Now in this scenario, right, it was a one truck company that only had a flatbed, and I alluded to it earlier right?

Speaker 2:

So when this company booked them for a dry van, that is the first flag when you look at their listed equipment you go wait a minute, like you only have a listed flatbed and you booked a dry van. Pick up the phone and have that conversation. That is the thing I want to get across. That would have prevented all this. But I want to tell you how this whole criminal scheme played out, so that you are aware of what they're doing.

Speaker 2:

And as a trucking company owner owns one truck, another person approached him and said I want to buy your trucking company. I'll give you, whatever the number was, 50 grand to buy your trucking company. The owner of the trucking company goes OK, I'll sell you my company for 50 grand. The guy saying that he wants to buy the company goes okay, give me your login so I can vet your information before I wire you the 50. So the legitimate owner of the trucking company gives him his DOT or FMCSA login and their highway logins. That person changed all the information to their email addresses, got the domain login to change the email addresses to them and change the FMCSA information. So got everything they needed. Before wiring the person that thought was selling their company the 50 grand got everything they needed booked.

Speaker 1:

What do they call that? Is that social engineering or what's when you it is? That's exactly what it's called insane.

Speaker 2:

So they change all the information literally to the fmcsa new phone numbers and the domains are all correct, like all the email addresses and also in every system carrier 411, highwayis and my carrier packets all look legitimate, no warnings, nothing, because nothing wrong had happened. Right, nate sells me his company or says he's going to sell it to me. I go hey, nate, give me all your logins. I want to check all your information. I change all the information before I give Nate money. Now what I do is I go and book 15 loads tomorrow and what they did was they got magnets printed out with the company Nate's company in this example. Right, put them on.

Speaker 2:

All these trucks went and picked up 15 loads, stole all 15 of them and nobody thought to pick up the phone and call Nate and go hey, nate, you booked a van with me, but you only show a flatbed. The only way you would have seen that fraud instance was to look at the equipment and to call the old phone number. And I can tell you the first thing I did when this client brought this to me was I went right to the FMCSA change log, looked at the old phone number, picked up the phone and called him and he goes. Yeah, he goes. Don't book any loads with that company. That guy screwed me out of 50 grand, said he was going to buy my company. Asked me for my logins, changed everything. I'm pretty sure he's stealing from everybody. 30 seconds into the phone call, the original owner told me exactly what happened. However, it was after the fact that all 15 loads were stolen.

Speaker 1:

I had one. Just to wrap up on. That similar situation is I had one I think it was last year was training somebody that's fairly newer and they were going to book a I don't even know what it was. They were booking something full truckload from a company that only had sprinters and cargo vans, and I was like you know, yeah, they look good on all the vetting systems, but you're trying to book them for equipment that they don't. Not only do they not have, but they clearly market themselves as this, this niche Right.

Speaker 2:

That's the thing that should make the hair on the back of my neck. Oh, wait a minute. Ask another question.

Speaker 1:

Yeah, this seem correct and this is where, like you can't you cannot replace experience you will eventually know what to look out for. Just second nature You'll know what to say on the phone when you're talking to a driver, just to make sure that you get the warm and fuzzy and you don't have any alarm bells going off inside your brain. But in the meantime, until you get to that point, that's why we are super adamant about having something to reference. We talk about that dispatch checklist or some sort of a manual thing to look through. When you started in brokerage, I had it. At Asset and 3PL we had an employee manual, and when we would hire somebody new, we do the same thing. When we've got an agent, that comes out like there is material, both um digital, like pdfs and videos, that we have people you know for them to reference. But like you probably had something to reference when you're booking your loads when you were brand new, right and here's the thing, right.

Speaker 2:

Like to nate point, I think the best prevention is understanding what you're looking at, because, again, in the economic environment we're in like, freight isn't increasing, carriers are not making a ton of money, everybody's trying to do more with less and move faster, right. So in that scenario, right Like it's more and more likely that you're going to be vulnerable to a situation like this because you're prioritizing speed over protection. And again, there's not one perfect way to prevent all these things. But to Nate's point, like, understanding the basics, I think, is the best prevention. Right, the reason I'm able to see this or I guarantee if I sent Nate any of these situations and he looked at it the first thing we look at is what we were trained on and again, as technology gets better, it goes hey, you don't need to do all these steps, you don't need to look at this, don't need to pay attention to that Book. More loads, faster, okay, that is good to an extent. But guess who also knows that? Everybody trying to steal from you, every criminal out there, realizes you're prioritizing speed over protection and they know exactly what your habits are, right. One of the things that I think makes this even more likely is like oh, I booked a load nine times with this carrier, I don't need to look at them again. So you don't look at them again. But guess what? So you don't look at them again. But guess what? Somebody hacked their domain, created a bunch of fake email addresses in the time you booked your last load and the next one, and you think you're talking to the same company. You're not. Like, if the biggest point I get across is like we need to know who we're doing business with, right, like, and that's why you can't just accept green light, red light, you've got to be able to look a little further and it doesn't take that long. Like for me to vet a carrier to Nate's point and the way. Like we were trained to do it, it takes me 15 seconds.

Speaker 2:

Like my habit still to this day is, if I'm talking to anybody, what's your MC? As I'm talking to them, that MC used to go into safer web and I would look at the FMCSA. Now it goes into highway. But I put it in three places. I have all three browsers open. It goes into carrier 411. It goes into highway and it goes into my carrier packets and I look for any type of violation, any type of red flag, and if I see one, I ask three more questions. If I see a second one, I'm asking five more questions and then, if I see a third one, I'm looking at that change log and when I get off the phone I'm calling the oldest phone number.

Speaker 2:

Right, because, again, like, even if you're just for round numbers, say, you make 200 bucks a load, right, how many loads do you think you've got a book to make up for losing a hundred thousand dollar load? Right, even if you have insurance 10 grand, 10 grand, deductible 20 grand and then the customer is going to withhold all their invoices until you pay that right. And as a broker you are removed from the cash flow of the business sometimes, so you don't see that impact, but it is enormous. Right, like that customer owes you 300 grand, you lost $100,000 shipment they aren't paying any bill for 45 days.

Speaker 1:

You know it's funny I thought about this because I had this conversation like two weeks ago with somebody and it's happened in the past too is like the if you make an error and you let's say like you book a truck that doesn't have the right insurance or the right limit, or they have an exclusion, whatever, Right, you said, imagine how much work you have to do to make up for that.

Speaker 1:

We did the math on one of the girls at our company recently on a claim where she made a mistake and it was like you're gonna have to basically run that customer's freight for free for like six months. You're gonna work for free for six months to make up for that loss. But anyway, the last thing I wanted to add in here, back to you know, um, training and whatnot, is like the stuff that we look for now. A lot of it's very different from when I first got into brokerage, but the one you know, and we evolved. But the one thing that my, my old boss told me and like it'll always stick with me and this is true today is like, if it seems too good to be true, it probably is right, it smells like shit and it looks like.

Speaker 1:

yeah, it tastes like it walks like a duck, you know exactly so, because the whole thing is, it's like you know, if you somehow book a truck falls off on a friday, you just somehow magically book the right truck at below market rate on a friday at 4 pm.

Speaker 2:

Like I don't think so, buddy, like I mean maybe every now and then three hundred dollars below that average at four o'clock in the afternoon on a friday put.

Speaker 1:

Very well, that could very well happen to you. Maybe ask a few more questions. Yeah, do your due diligence, so, but good discussion, we just wanted to talk through this stuff.

Speaker 2:

Um, good, doing one in person, man, it's always, always, uh always a pleasure for sure, and I think maybe next week we can just do some screen sharing and show you, take you through these platforms, show you what you can look for, what to see. Maybe go step by step, because we want to do more like 101 stuff, where it's just like things that are fundamental to doing this job. So more content to come. Final thoughts Whether you believe you can or believe you can't, you're right, and until next time, go Bills.

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Benjamin Kowalski

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Nate Cross

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