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What Are Chameleon Carriers And Why They Need To Be Stopped

February 27, 2018 by Steven M. Gursten

Chameleon carriers are 3 times more likely to cause a truck accident

Chameleon carriers: Crackdown on unsafe trucking companies must continue

Lawyers who specialize in helping people injured in truck accidents have known about unsafe trucking companies known as chameleon carriers for years. These are truck companies and busing outfits that try to hide from their dismal safety records and often deadly crash history by shutting down and then re-opening under different carrier names. This allows them to game the system and hide safety records by obtaining a new name and a new USDOT number.

Sadly, these unsafe trucking companies have caused an inordinate number of preventable wrecks, but until recently there has been very little that federal and state regulators could do to stop this dangerous practice.

That’s starting to change, however, and the hunt to stop these dangerous chameleon carriers has begun in earnest, as WOOD TV of Grand Rapids demonstrated in a recent story that focused on one unsafe trucking company operating out of Lansing, Michigan. Disclosure: I met with Susan Samples in Grand Rapids to discuss the issue of unsafe chameleon carriers and have corresponded by email with her while she was investigating this story.

In her February 15, 2018, story, “Feds fight unsafe ‘chameleon’ trucking companies,” WOOD TV’s Target 8 Investigator Susan Samples reported:

  • The owner of the Lansing-based, trucking company, Specialized Solutions, LLC, “has a ‘history of non-compliance’ that goes beyond Specialized Solutions. Inspectors linked him to at least four other trucking companies, including Azda Logistics.”
  • A 2016 compliance review observed that “Azda Logistics LLC with [the person who currently owns Specialized Solutions, LLC] as the owner, manager or company representative appears to be a reincarnated carrier from at least four other motor carriers, three of which have been put out of service …”
  • A 2016 compliance review of Azda Logistics predicted that “Azda Logistics will most likely reincarnate itself as Specialized Solutions LLC to avoid an adverse safety rating or history …”
  • Even though “officials at the FMSCA, responding to Target 8’s questions this week, said they ultimately found ‘no evidence’ to support a charge that [the owner of Specialized Solutions, LLC] reincarnated carriers specifically for the purpose of evading regulations,” the owner of Specialized Solutions, LLC, “himself told Target 8 that he had switched company names in the past to hide his troubled safety record from potential customers, but not from government regulators.”

I realize the FMCSA appears to have “cleared” the trucking company of being a chameleon carrier, but, as the saying goes, if it walks like a duck and quacks like a duck …

As an attorney who has handled over 300 truck accident cases – both for injured motorists and truckers – this report is harrowing but also welcome news. Yes, it’s horrible to see that chameleon carriers are out there, putting everyone’s lives at risk on our roads. But I already knew that. Now, hopefully thanks to Susan and her story on chameleon carriers in the trucking industry, thousands of people in West Michigan now know about it too. Shining the spotlight on this dangerous practice can only help to raise public awareness and push our safety regulators to do more to stop this.

And speaking of safety regulators doing more, what has been so infuriating to me for years has been the FMCSA’s head-in-the-sand approach towards chameleon carriers. We saw a glimpse of this in the WOOD TV story. Despite evidence that this trucking company is clearly unsafe, the federal safety agency whose mission “is to reduce crashes, injuries and fatalities involving large trucks and buses” somehow convinced itself there was “no evidence” that the owner was trying to evade safety regulations by repeatedly closing businesses with bad safety records and, then, re-opening the same trucking company under a new name.

What are chameleon carriers?

Chameleon carriers are usually small trucking companies that have had too many safety violations and have caused too many trucking accidents. Instead of shutting down the business (as they should) to protect the driving public’s safety, these trucking companies change their names and “start” doing business as a brand-new company – but with the same old dangerous people, the same old under-serviced trucks and the same old unsafe ways still intact.

Here’s a description from the U.S. Government Accountability Office (GAO)’s March 2012 report to Congress, “Motor Carrier Safety – New Applicant Reviews Should Expand to Identify Freight Carriers Evading Detection”:

  • They are “motor carriers [that] have registered and been operating illegally in interstate commerce by using a new identity in an effort to disguise their former identity and evade enforcement actions issued against them by the Federal Motor Carrier Safety Administration (FMCSA)—the federal agency responsible for overseeing motor carrier safety. Such carriers are referred to as chameleon carriers and may include interstate passenger carriers (intercity and charter or tour bus operators), household goods carriers (hired by consumers to move personal property), or freight truck carriers (shippers of commercial goods).”

How dangerous are they?

In its 2012 report, the GOA reported:

  • “18 percent of the applicants [for operating authority from the FMCSA] with chameleon attributes were involved in severe crashes compared with 6 percent of new applicants without chameleon attributes.”
  • Between 2005 and 2010, “new applicants with chameleon attributes were three times more likely than all other new applicant carriers to later be involved in a severe crash—one in which there was a fatality or injury.”

The GAO explained that “chameleon attributes” meant that a carrier: “[S]ubmitted registration information that matched information for a previously registered carrier”; and, “[t]he previously registered carrier had a motive for evading detection,” such as “a history of safety violations” or a “bankruptcy that might motivate a carrier to become a chameleon carrier.”

How widespread is the problem of chameleon carriers in the trucking industry?

In its analysis of FMCSA data, the GAO found:

  • The “number of carriers with chameleon attributes” increased “from 759 in 2005 to 1,136 in 2010.”

How has the FMCSA’s “Vetting Program” evolved? 

The FMCSA’s hunt for chameleon carriers officially began after an August 2008 fatal bus crash in Sherman, Texas involving one which killed 17 people. The carrier had been ordered out-of-service just two months prior by the FMCSA.

Immediately thereafter, the FMCSA began its “Vetting Program,” which is a “dedicated process to identify and prevent these trucking companies from applying for and receiving operating authority.”

Although the “Vetting Program” was initially limited only “to bus companies (passenger carriers) and movers (household goods carriers),” it now includes freight carriers, too.

As of 2016, the program incorporates “an algorithm and corresponding software” which conducts “an automatic risk-based assessment that calculates a risk potential based on the likelihood that an applicant for operating authority [i.e., a trucking company that wants to operate in interstate commerce] is a chameleon carrier, is attempting to reincarnate, or is attempting otherwise to receive authority illicitly.”

(Sources: U.S. Government Accountability Office’s March 2012 report to Congress, “Motor Carrier Safety – New Applicant Reviews Should Expand to Identify Freight Carriers Evading Detection”; Federal Motor Carrier Safety Administration, “Utility for Risk-Based Screening and Assessment (URSA),” Updated January 8, 2018)

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