ELD loopholes fueling fraud, driving good carriers out of business, experts warn

ELD loopholes fueling fraud, driving good carriers out of business, experts warn

ELD loopholes fueling fraud, driving good carriers out of business, experts warn

The U.S. trucking industry is confronting what multiple fleet executives call a systemic failure in electronic logging device (ELD) oversight, driven by a regulatory framework that allows ELD manufacturers to self-certify their compliance with federal hours-of-service rules.

The lack of oversight by FMCSA on electronic logbook providers has enabled a shadow market of devices that allow companies to edit driver logs regularly, which allows fleets to drive long past the established hours-of-service regulations.

“The only compliance necessary to create an E-Log is for the E-Log creator to just check a box saying “self-certifying” that the E-Log will follow the rules — there’s no government oversight here,” Zach Meiborg, president of Meiborg Trucking in Rockford, Illinois and 25 year industry veteran, told FreightWaves. “There’s no certification process. And because of that, the market has been flooded with ELDs that allow logbook edits. It’s widespread and has caused the glut of capacity of illegal operators.”

Meiborg calls the result a “two-platform trucking market” — compliant fleets that run 2,000 to 2,500 miles per week, and fleets that use manipulated ELD logs to run 4,000 to 5,000 miles.

“Remember the cost per mile decreases with every additional mile a truck runs, because you can dilute your overhead and fixed costs,” Meiborg added.

“These illegal operators are running around at a cost of $1.80 per mile, while the compliant fleets are operating in the $2.30 per mile range. What this translates to: the compliant fleets are losing $1,000 per month per truck and the noncompliant fleets are making $2,000 per truck per month. It’s not sustainable if we want to have compliant fleets on the road.”

Those cost differences are reshaping which carriers win freight — and which close.

“Good, legacy fleets — 40-year companies — are shutting down,” Meiborg said. “Meanwhile, the fleets running illegal logs are expanding.”

For Dave Moss, a 40-year trucking industry safety veteran, the issue became personal.

“At my last company, logs were being edited overseas. They were shaving time so drivers could keep running,” Moss told FreightWaves. “When I raised it, management said, ‘We have to do this to make money.’ That’s when I resigned.”

Audit reports from the company’s own ELD software showed what was happening, Moss said.

“If we had a crash — even if it wasn’t our fault — a plaintiff’s attorney would find those edits, and the company would be done. I wasn’t going to be the safety director who signed off on that,” Moss said. “This is a management problem. Drivers do what they’re allowed to do. Safety starts at the top.”

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