WASHINGTON — A proposed rule aimed at cracking down on junk fees charged to consumers has caught the attention of the Federal Motor Carrier Safety Administration.
The proposed rule, issued by the Federal Trade Commission last year, would, among other things, allow the FTC to seek civil penalties against fraudsters and more readily obtain financial remedies for consumers who are harmed.
FMCSA weighed in on the proposal by calling out unscrupulous towing companies that overcharge truck drivers who call for assistance for a variety of reasons, including when they are involved in a crash.
“Predatory towing negatively impacts consumers, including commercial motor vehicle drivers and trucking companies,” said FMCSA Acting Deputy Administrator Sue Lawless. “It is detrimental to the overall health of the trucking industry, and it’s time to end excessive rates, surcharges and other unfair fees associated with predatory towing.”
In comments submitted to the FTC on Wednesday, Lawless cites several potentially unfair or deceptive fee practices used by predatory towers. They include hiding fees until the job is completed, charging for unnecessary or worthless services, and imposing an excessive number of fees for excessive amounts – all of which can add up to thousands of dollars, she said.
Once towed, truck owners and operators “are in a very vulnerable position and highly susceptible to predation,” Lawless wrote. “Predatory towing companies can and do use their possession of the vehicle as leverage to price gouge and otherwise prey upon [drivers] who are in no position to push back.”
Such practices, she asserted, “fall within the purview of the proposed regulation “which would greatly benefit truckers if finalized.”
A study published by the American Transportation Research Institute (ATRI) in November found that excessive rates and unwarranted additional service charges were the two most common forms of predatory towing, experienced by 82.7% and 81.8% of surveyed motor carriers, respectively.
ATRI also found that 29.8% of invoices were found to include either excessive rates or excessive additional charges. Roughly half of these cases had excessive rates for equipment, labor or storage, and the other half had excessive miscellaneous or administrative charges.
In supporting prohibitions or restrictions on excessive fee practices, FMCSA urged FTC to focus on consumers “who have little to no ability to avoid, negotiate, decline, anticipate, or limit the number or cost of the fees, or consumers who are vulnerable, in distress, or otherwise limited in choice by their circumstances.”
The agency suggested that a final rule treat each illegal junk fee as a separate violation, and that it expressly prohibit companies from charging or collecting fees “that are not appropriately disclosed, are not included in the total price, and/or cannot be fully calculated upfront.”
In addition, because truck drivers often drive in multiple states, FMCSA requested that the FTC “provide guidance on how [the proposed regulation] would affect different state and local laws governing fees in the towing industry, either in the final rule or in subsequent interpretive guidance.”
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