FTC Charges Operators of Scheme That Used Fake Government Affiliation to Sell Commercial Trucking Registration Services

FTC Charges Operators of Scheme That Used Fake Government Affiliation to Sell Commercial Trucking Registration Services

A federal judge has granted the Federal Trade Commission’s request for a preliminary injunction against two people and their companies for allegedly tricking small commercial trucking businesses into paying them for federal and state motor carrier registrations by impersonating government transportation agencies, such as the U.S. Department of Transportation (USDOT).

Consumers who own and operate certain types of commercial vehicles must register annually with the Unified Carrier Registration (UCR) system or their state government and pay a fee based on their fleet size. Some of these small businesses also must file a Motor Carrier Identification Report every two years, which can be done at no charge on the Federal Motor Carrier Safety Administration website.

According to the FTC’s complaint, the defendants have taken in more than $19 million from thousands of small businesses by sending misleading robocalls, emails, and text messages that create and reinforce the false impression that they are, or are affiliated with, the USDOT, the UCR system, or another government agency. As noted in the FTC’s complaint, the defendants used official-sounding names, official-looking websites, warnings of $1,000 in civil penalties or fines for non-compliance, and threats of imminent law enforcement to trick consumers into using their registration services instead of using official government website services.

According to the complaint, the defendants deceptively disclosed the total amount charged, without telling consumers the cost included the defendants’ service fees that ranged from $25 to $550 or more. The FTC also alleges that many consumers who paid the defendants’ UCR fees were automatically enrolled, without their knowledge or consent, in “SafeRenew,” the defendants’ annual renewal program for UCR fees.

Defendants James P. Lamb, Uliana Bogash, DOTAuthority.com Inc., DOTFilings.com Inc., Excelsior Enterprises International Inc. and JPL Enterprises International Inc. are charged with violating the FTC Act and the Restore Online Shoppers Confidence Act.

The Commission vote authorizing the staff to file the complaint was 3-0. It was filed in the U.S. District Court for the Southern District of Florida. The court entered a preliminary injunction against the defendants on September 29, 2016.