Definition of Freight Fraud
Freight fraud is defined as when individuals commit crimes such as identity theft and/or provide false credentials to obtain funds, shipments or other services related to the trucking industry. While cargo theft is physical theft of the product, freight fraud is based upon an individual manipulating an identity and providing false credentials to deceive a shipper, carrier, or broker.
According to a recent study, the trucking industry experienced a total loss of $455M due to fraud in 2024. This number increased by 400% compared to previous years due to an exponential rise in double brokering complaints. All parties involved in the freight industry experience risks and disadvantages of fraud due to the vulnerability of digital freight matching platforms being exploited by fraudulent individuals.
Types of Freight Fraud Schemes That Are Currently the Most Common
Double Brokering Scams
Double brokering is when a carrier accepts a shipment from a broker and then brokers the shipment out to another carrier without permission from the broker or carrier. The scammer obtains payment for the shipment, and then disappears prior to the carrier receiving payment for completing the shipment.
These types of scams are difficult to identify, since scammers typically utilize stolen MC numbers and/or forged insurance certificates. However, the following warning signs indicate potential double brokering scams: (i) Carriers are accepting shipments unrealistically quickly; (ii) Contact information is inconsistent; and (iii) Rates offered are extremely low.
Identity Theft and Stolen MC Numbers/Fake MC Numbers
Individuals commit identity theft by impersonating legitimate carriers using the FMCSA credentials of the legitimate carrier. These scammers then create fake email addresses, spoof the phone numbers of the legitimate carrier, and produce counterfeit insurance certificates. Due to the public nature of FMCSA data, it is relatively simple for scammers to obtain the legitimate company information and modify the contact information.
Scammers also purchase abandoned MC numbers or obtain unauthorized access to FMCSA accounts to modify the contact information. Additionally, scammers will modify insurance certificates by creating a duplicate of the legitimate certificate and replacing the phone number(s) with a disposable/throwaway line(s).
Load Hijacking & Fake Dispatchers
Scammers are able to access legitimate carrier email accounts by utilizing phishing attacks and then intercept rate confirmations and load tenders. Scammers utilize email domain spoofing and caller ID manipulation to appear as the trusted dispatcher.
Smaller carriers are often targeted due to the lack of advanced cybersecurity measures implemented by the smaller carriers. During the first quarter of 2025, over 400,000 fraudulent attempts were prevented.
Red Flags Indicating Potential Freight Fraud
Warning signs indicating possible freight fraud include: (i) Rates that are lower than market prices or (ii) Carriers that accept shipments without discussing price or terms. Additionally, the following are potential indicators of freight fraud: (i) Urgent payment demands (especially if requested via Zelle, Cash App or via accounts that do not correspond with the company name); (ii) Inconsistencies among various documentation including W-9 forms, FMCSA profile documentation, and insurance documentation; and (iii) Mid-transaction changes to contact information, phone numbers or email addresses.
Methods to Detect Freight Fraud Prior to Financial Loss
Prior to booking loads with a carrier, verify the carrier’s authority and insurance using FMCSA’s SAFER system; however, do not rely solely on this method. Contact the agent representing the insurance policy via the telephone number(s) provided by the insurance agency, not the certificate. Verify contact information across at least three different sources. If the email domain does not correlate with the company name and/or utilizes a free service (such as Gmail), investigate further. As mentioned previously, manual verifications are insufficient as scammers continuously update the FMCSA record in real time.
How FreightCheckers Assists in Mitigating Fraud Risks
FreightCheckers continuously verifies and monitors the validity of a carrier’s credentials, insurance status, and authority changes. FreightCheckers cross-references a carrier’s identity against multiple data sources and identifies and notifies customers of suspicious activity, contact changes made to a carrier’s FMCSA account, cancellation of a carrier’s insurance policies, and/or sale of a carrier’s MC number prior to a customer booking a load with the carrier.
Why Freight Fraud Prevention Needs Continuous Monitoring
Preventing freight fraud is a continuous process. Although a carrier may have been previously vetted, a carrier’s credentials may be compromised once a fraudster purchases the carrier’s MC number, hacks into the carrier’s account or spoofs the carrier’s identity. Therefore, proactive screening protects a company’s relationships by identifying issues such as canceled insurance policies, sold MC numbers, or unauthorized changes made to a carrier’s FMCSA contact information prior to those issues impacting a company’s operations. Contact FreightCheckers to learn how continuous monitoring can protect your freight operations.
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