Business

It’s a sunny day in Fort Worth, Texas. A driver pulls up to a diesel island at a favorite interstate truck stop and swipes a company fuel card. As $800 worth of diesel fuel slowly fills the tanks, the transaction seems perfectly normal. Appearances, however, can be deceiving. It might be weeks before the carrier notices something strange about the driver’s fuel card statements. The fuel card was, as expected, used to pay for diesel along the driver’s regular route across the southern tier of the U.S. However, it also filled the tank in places like New York and Iowa. Before long, accountants handling fuel payments for the carrier realize the driver has been a victim of fuel card skimming. “The actual cost of fraud for trucking is unclear, but agencies have stated it’s millions of dollars each month,” said Spencer Barkoff, co-founder and president of Relay Payments. The problem is growing. “Overall, the FBI reports an increase of 700% of card skimming at all businesses in the first six months of 2022,” he continued. A fleet of 100 trucks might pay $20,000 a month in fraudulent charges. However, the impact of these charges goes beyond the company’s financial bottom line. “Additional costs include the operational headaches that fleets and drivers face when they are the victims of card skimming,” Barkoff said. Drivers are grounded because they’re unable to pay for fuel. Deliveries are delayed. Drivers have fewer available hours of service. And the carrier provides poor customer service. “Dealing with the aftermath of fraud, such as identifying and disputing fraudulent transactions and submitting claims is burdensome,” Barkoff said, noting that it complicates cash flow and back office operations for fleets. “We have one fleet customer whose CEO had to drive to meet a driver and physically hand them a new credit card after their existing billing card was closed due to card skimming fraud,” he said. “It’s a logistical and cash flow nightmare.” Barkoff explains how fuel card skimmers operate. “Card skimming involves the use of illegal devices that steal credit or debit card information from unsuspecting individuals,” he said. “Skimmers are installed on ATM machines or fuel pumps, and they capture sensitive data when a driver swipes a card.” Because fuel cards are a primary form of payment in the trucking industry, truck drivers are particularly vulnerable to card skimming. “Card skimmers collect the information to create dummy fuel cards, make fraudulent fuel purchases with those cards, and resell fuel for their own personal profit,” Barkoff said. Carriers and fuel-card issuers often set daily spend caps to limit fraud risk, but scammers have various ways of working around these measures. So, how can carriers and drivers fight fuel card skimming? Richard Sullivan, a consultant with the Truckload Carriers Association (TCA), says a primary method is education. Sullivan has worked with the North Carolina Attorney General’s office to develop materials to educate fleet operators, drivers, and law enforcement about fuel card skimming, the complicated process, and the multiple crimes being committed. “Law enforcement will arrest someone for using a skimmed card, but they seldom hold those responsible,” Sullivan said, “Law enforcement doesn’t understand the enormity of the fraud taking place. A series of criminal actions are involved.” Scammers create a device solely for the purpose of skimming sensitive information and then install it inside or on a fuel pump. Then, using trucks illegally retrofitted with bladder tanks that hold 250 to 500 gallons, they purchase fuel using the skimmed cards. These bladder tanks are unregulated, and they’re dangerous; static electricity can easily create explosions. Later, the trucks deliver the fuel to a central hub, where it is sold on the black market. No taxes are collected, so the merchant, fleet, driver, and government are all subjected to fraud. It’s a complicated network that is operated by cartels. “The simplest solution — and one that truck stops are advocating for — is using digital payment methods to pay for fuel,” Barkoff noted. “With no physical card, there’s no opportunity for card skimming.” This solution can benefit truck stops because they don’t have to spend revenue and handle the back-office issues created by skimming. “Carriers and drivers also benefit, dealing with far fewer hassles and saving time and money as a result,” Barkoff said. “With no card, there’s no magnetic swipe, and thus no card skimming,” he continued. “There’s also no opportunity for other forms of card fraud, because the digital solution relies on one-time payment codes that don’t have to be tied to any credit card as a form of payment.” Until digital or some other fraud-proof payment system gain widespread use, what can the average driver do to protect against fraud? The TCA recommends that drivers look at the card slot on the diesel pump. One that’s been fitted with a skimming device will often look different than slots on nearby fuel dispensers. Drivers should also take notice of broken inspection seals on the fuel dispensers. These can mean that the dispenser has been opened, allowing someone to attach a skimmer inside the machine. In addition, drivers should use the fuel pumps closest to the entrance of the truck stop when possible. Skimmers are most likely to work the pumps farthest from the building, so they won’t be noticed installing their devices. Finally, if a driver has repeated problems with a transaction or receives error codes, the issue should be reported to dispatch immediately. As for the future of fuel card skimming, Barkoff says the industry can’t let its guard down anytime soon. “Criminals are creative, and have found countless ways to steal credit card information,” he noted. “Those who continue to rely on modes of payment such as credit cards, checks, and cash will face more instances of card skimming.” He believes digital payments are becoming better options and that more companies will invest in non-magnetic swipe methods of payment in the future. “The good news is that many carriers, drivers, and merchants are waking up to the issue and have begun to digitally transform with digital payment solutions,” Barkoff said. This article originally appeared in the January/February 2024 edition of Truckload Authority, the official publication of the Truckload Carriers Association.

There’s no question that technology has changed the trucking industry in numerous ways, including payment methods for toll roads and bridges. Gone are the days when drivers carried enough cash for weeks of toll payments. These days, it’s as simple as driving under a toll gantry — usually without even slowing from highway speeds. Two primary types of open road tolling are used by tolling authorities, RFID (radio frequency identification) and toll by plate. By far, the most popular tolling option for carriers is RFID. A transponder unit is required for each vehicle, which communicates with an RFID reader installed at the tolling location. However, the purchase and installation of the transponders can cost more than some carriers are willing to pay. Tolling by plate requires less of an initial investment because transponders aren’t needed. However, tolling costs can be considerably higher and billing errors more frequent. Smaller carriers whose drivers don’t frequently encounter tolling situations, sometimes choose this route. Toll management systems like Bestpass, PrePass, and E-ZPass are helping fleet operators untangle the confusion of working with different tolling authorities, and saving companies money at the same time. “We’ve been involved with Bestpass since it started as the New York State Trucking Association toll on discount program. So, we’re longtime members,” said Ken Johnson, executive chairman of Farmington, New York-based Leonard’s Express. “The best part about it is its simplicity over having to deal with each state individually.” Luis Guzman, CFO for PGT Trucking, based in Aliquippa, Pennsylvania, expressed similar sentiments. “We use PrePass for all our tolling and for weigh stations,” Guzman said. “At PGT Trucking, we are 50% company- owned trucks and 50% owner-operators. We have transponders in our company trucks, and then we also offer them to our owner-operators.” According to Michael DeMateo, PGT’s supervisor of driver support services, the carrier currently has 800 transponders. “One thing that’s good about PrePass is that we have special reporting that allows us to see whenever, for example, we run the course of a full toll which is a significant amount of money, and we usually almost never do that,” DeMateo said. “They dispute those for us. It would require a lot of work to try to catch that stuff.” Since toll gantries are usually equipped with photographic equipment and RFID readers, occasionally errors are made in which a truck owner is billed once through the transponder and then again through the plate number. Carriers have even received one invoice for a tractor’s plate, another for the trailer’s plate, and a third for the transponder. Thankfully, those instances are rare. Occasionally, a plate reader will misread a digit in the plate number and automatically generate an invoice to the wrong person or company. Both Bestpass and PrePass have systems that work with tolling authorities to resolve this type of issue. “We try to work with the toll agencies. Say, you’ve got a problem,” said Joe Clavelle, vice president of business development for Bestpass. “We’ll work to rectify it, because no one wants to get charged twice or three times.” Helping resolve invoicing issues helps the tolling agency, too. “We try to work with the local agency and reduce the problem for everyone, because it causes it to cost them money as well,” Clavelle said. “When you have thousands of people phoning in to say, ‘Hey, I was billed three times,’ this is not what they want. It costs that agency time and money to take those calls.” Reducing expenses is another benefit of using a toll management system. Most tolling authorities offer discounts for using RFID systems, and providers like Bestpass consolidate invoices from multiple agencies into one convenient report. When a carrier receives invoices from several different sources, this increases the risk of missing one, possibly generating late fees or even violations. “It takes time, and you have to fund each one and deal with all those separate bills,” Clavelle said. “We get comprehensive coverage for the areas traveled.” It’s also important to discuss the carrier’s running area with the toll management provider. “It depends on where your fleet operates,” Johnson noted. “New York is offering a better price for a New York-based transponder versus the national one. Other states do that too. So, have the conversation; figure out a solution that’s best for yourself.” Some tolling jurisdictions offer volume discounts through Bestpass and PrePass that smaller carriers might not qualify for on their own. “We have buying power where we can buy transactions so that you qualify for a volume rebate you might not get on your own,” Clavelle said. “With the 20% volume rebates — I think to go over some of those bridges in New York is over $100 — so $20 savings on one big truck could be a return on investment right there.” A white paper available on the Bestpass website shows discounts of up to 75% for some tolling locations. “Honestly, I can’t imagine running without it — just the headache it would be to manage all those different accounts with the size of our fleet,” DeMateo said. “(It’s good to have) it all on one device and be able to manage it. Offering it to our contractors is in their best interest — and our interests as well.” Tolling by plate still offers advantages of cash systems (at least at the toll authorities that still accept cash) but isn’t as cost effective as using an RFID system. Still, for carriers that run in areas where toll roads or bridges aren’t prevalent, this option might be the right choice. For many, however, well-managed RFID tolling can increase route efficiency and reduce operating expenses. This article originally appeared in the January/February 2024 edition of Truckload Authority, the official publication of the Truckload Carriers Association.

For most fleets, safety is a top priority. After all, reputable motor carriers don’t operate under the assumption of, “Well, if they don’t catch us, it’s OK.” Unfortunately, it’s all too easy to acquire blemishes on a safety record, even for the most cautious of carriers. From properly secured cargo to accurate record keeping and vehicle maintenance, there are dozens of things that can go wrong if fleet managers aren’t on top of equipment maintenance and driver training. Let’s be honest: It’s rare for a carrier to maintain a completely spotless safety record. A poor safety record often translates to issues that can seriously impact a company’s bottom line, from equipment and driver violation fees to expensive lawsuits when drivers are involved in at-fault accidents. And, of course, insurance providers keep track of motor carriers’ “report cards.” A bad grade can easily result in higher premiums. So, how can a carrier with a less-than-perfect record turn things around? Invest in training. During a 2023 interview on the Tenney Group’s “In the Hot Seat” YouTube series, Brandon Wiseman, president of Trucksafe Consulting, noted that systematic problems with safety are often due to a lack of education on the part of various levels of a carrier. “You can’t get ahold of problems unless you understand what’s going on,” he said, adding that education and training is key to helping companies identify and resolve issues. For instance, he said, if a carrier is having constant issues with its drivers’ hours of service (HOS), “there is no substitute for bringing drivers in and giving them additional training on this requirement. You have to help them understand where things are going wrong.” Drivers aren’t the only team members who may require updated training. Safety team members and company owners can also benefit from a refresher course in rules and regulations. Make safety a top priority. Chris Gulker, senior vice president of transportation at TrueNorth, says safety is paramount — or at least it should be — for all carriers. “This is deeply embedded into the culture and day to day mindset, culture, and day-to-day practices of industry-leading companies,” he said. “Because safety is such a critical concern in the transportation industry, restoring creditability by rebuilding trust and credibility will require time, strategic planning, and commitment from all levels of the organization.” Gulker says this should involve a comprehensive approach that addresses all aspects of the business, including operations, finance, leadership, safety, recruiting — a true team effort across the enterprise. If a company finds itself in trouble, there are steps that can be taken to right the ship, Gulker said. “The first step in a company restoring a safety reputation is establishing commitment from the entire leadership team,” he said. “For true, long-lasting change to occur, a demonstrated commitment to safety is required by all levels of the organization. Safety needs to be given priority in the day-to-day decision making, and it starts with the most senior leaders.” Once a thorough assessment has been completed, a comprehensive risk management strategy needs to be developed, communicated to the organization, and deployed. While there’s never a one-size-fits-all solution, Gulker says, the following strategies can help: Create a safety mission statement that is communicated on a regular basis to the entire organization. This is a foundational step to creating a true culture of safety. Establish three to five critical key performance indicators (KPIs) with target improvement goals to track performance in real-time. Providing KPIs at both the enterprise level and the “middle of the business” level (e.g., a terminal level) allows progress to be tracked and performance to be managed to drive results. Establish a cross-functional safety council that includes representatives from safety/risk, along with executive leadership, finance, and operations teams; safety/risk should have an equal seat at the table. This allows for open communication about problems and progress while also soliciting collaborative feedback across functions. Invest in comprehensive safety training at appropriate levels for all employees — executives, safety and compliance teams, dispatch, recruiting, orientation, drivers, etc. Implement safety technologies. Gulker says that, in recent years, safety technology innovations have developed at a staggering pace. Implementing state-of-art safety technology such as cameras, lane-deviation assistance, and active crash mitigation not only improves safety performance; it also drives down overall costs in the long term. Leveraging safety technology also allows companies to implement coaching / development programs and incentives for positive performance. Continue to improve. By continuously monitoring progress and ongoing safety performance, a company can evaluate whether the strategies are effective or if adjustments need to be made. Take advantage of technology. In a blog post entitled “FMCSA Regulations: A Guide for Fleet Managers” fleet operations company Samsara offered the following tips to keep fleets compliant with FMCSA regulations: Invest in an easy-to-use ELD solution. During roadside inspections (or if a fleet is ever audited), it’s important to be sure drivers’ HOS logs are accurate, complete, and easy to access. It’s important to choose an electronic logging device (ELD) solution that’s easy for drivers and compliance managers to use. Go paperless using electronic DVIRs. Still using paper driver vehicle inspection reports (DVIRs)? Now is the time to switch to digital. Because electronic driver vehicle inspection reports (eDVIRs) are digital, they make it easier to stay compliant with FMCSA regulations related to maintenance and vehicle safety. Drivers can submit eDVIRs right from the palm of their hand using an app; these apps are available from various providers. The eDVIRs instantly appear on a carrier’s online dashboard, positioned alongside preventive maintenance schedules, maintenance logs, and real-time vehicle statuses. This allows technicians to prioritize the most urgent issues and sign the eDVIR for the next driver to verify, completing the FMCSA requirement. Keep CSA scores low with dash cams. The FMCSA uses the compliance, safety and accountability (CSA) program to identify high-risk carriers and intervene. Sometimes the FMCSA will even put carriers with high CSA scores out of service until they can improve their compliance or safety procedures. One of the best ways to avoid FMCSA intervention is for a carrier to keep its CSA scores low. The solution? Dash cams. Dash cams are an extremely effective safety tool for commercial fleets. With better visibility into risky driving behavior (like speeding, distracted driving, and tailgating), carriers can more effectively coach drivers and prevent accidents. AI dash cams can automatically upload incident footage to the cloud, which makes it easy to exonerate drivers from not-at-fault accidents and avoid unnecessary marks to CSA scores. Know “the right stuff.” However, carriers that follow these measures and make sure their teams have access to proper education and training still sometimes find themselves behind the proverbial eight-ball when it comes to compliance. Wiseman says he’s not surprised. “There are just so many regs out there,” he said. “There will be some gaps in understanding how these things apply to your fleet. So, first things first: You gotta make sure you have a foundational understanding of requirements for fleet education is big part of it.” Being proactive is also key, he said. “A lot of fleets are just trying to put out fires as they come to them,” he said. “(I hear), ‘We have the DOT (Department of Transportation) knocking on the door for audit. What can we do to fix it?’” he continued. “It’s too late at that point to fix what they will discover in audit. Too many fleets are trying to survive, so they do what they gotta do, but spending a little time trying to close gaps can save a lot of trouble.” This article originally appeared in the January/February 2024 edition of Truckload Authority, the official publication of the Truckload Carriers Association.