A freight broker is a businessperson who arranges the shipment of goods for another company or individual. Freight brokers are usually in charge of finding shipments, negotiating rates, and arranging for transportation. They work with carriers to move cargo from one place to another.
Unfortunately, the answer is NO, unless you are registered with the Federal Motor Carrier Safety Administration (FMCSA) as both a freight broker and a carrier.
The FMCSA defines a motor carrier as “a for-hire carrier that transports passengers or property in interstate commerce and is a commercial motor vehicle operator.” In order to get your own carrier authority, you must meet certain requirements set forth by the FMCSA. These include having a U.S. Department of Transportation (DOT) number, being registered with the FMCSA, and having insurance.
If you are found to be operating as a freight broker and carrier without the proper authority, you may be subject to fines and penalties. The FMCSA has the authority to shut down your business if you are found to be in violation of their regulations.
The fines for operating as a freight broker and carrier without the proper authority can be quite costly. Fines start at $2,500 per violation but can go up to $25,000 per violation. You can also be subject to civil penalties of up to $10,000 with a maximum penalty of $30,000. The FMCSA has the authority to shut down your business if you are found to be in violation of their regulations.
It’s important to note that even if you hire someone else to drive your truck, you are still considered the carrier and are responsible for ensuring that the driver meets all of the FMCSA’s requirements:
Federal Motor Carrier Safety Administration (FMCSA) Requirements
1. You Must Have a U.S. Department of Transportation (DOT) Number
It costs $300 to get a U.S. DOT number. In order to get your number, you must be registered with the FMCSA and have insurance. You must also meet certain requirements, including having a physical office and hiring employees.
2. You Must Be Registered With the FMCSA
You can register with the FMCSA by going to their website and filling out an application. The registration process is simple and only takes a few minutes.
3. You Must Have Insurance
You must have insurance to operate as a carrier. The minimum amount of insurance required by the FMCSA is $750,000. The cost of insurance for a truck carrying $750,000 worth of cargo will depend on the insurance company you go with, the coverage you choose, and the deductibles you select.
However, it is safe to say that your premium will cost thousands of dollars. For example, GEICO offers insurance policies with a $5,000 deductible that start at $5,000 per year.
You cannot be a freight broker and also own trucks. If you want to own trucks, you need to get your own carrier authority from the FMCSA. Keep in mind that even if you hire someone to drive your truck, you are still responsible for ensuring that the driver meets all of the FMCSA’s requirements. If you want to operate as a freight broker, you need to obtain a license from the FMCSA.