Don’t Let Your Haulage Company Get Trapped by Double Brokering
Content
Double brokering is the unauthorised transfer of a load to another haulage company. It is a problem entrenched in today’s volatile freight market! Sometimes it occurs out of negligence, such as overbooking or miscommunication. Other times, it is a deliberate act of fraud that leaves legitimate hauliers footing the bill. Either way, the result is financial loss, liability issues, and damage to reputation.
Awareness is the first line of defence. In this article, you’ll learn what double brokering is, why it happens so frequently, how to avoid it, and the serious financial and legal consequences of being caught in the middle.
What is double brokering?
Double brokering is the illegal act of a broker or carrier handing a load to another haulage company without notifying the shipper. In a legitimate shipper–broker agreement, the broker assigns loads to approved carriers who deliver them under agreed terms. If a load is passed to another party, it is only lawful if the original shipper has provided full consent.
The following arrangements constitute double brokering:
- A haulier accepts a load from a broker and then quietly assigns it to another carrier without informing the broker or shipper.
- A broker passes freight to another broker without the shipper’s knowledge or authorisation.
It’s important not to confuse this with co-brokering, which is legal. In co-brokering, multiple brokers or carriers work together transparently with the shipper’s approval, and all fees are split fairly.
Important Note: Any transfer of cargo to another broker or carrier requires written authorisation from the shipper. Without it, the arrangement is double brokering — and illegal.
Why is Double Brokering so Common?
The haulage industry is competitive, margins are tight, and rates fluctuate rapidly. These pressures create conditions where double brokering can take hold.
Two common scenarios include:
Carriers overcommitting: In an effort to secure lanes and win work, some hauliers take on more loads than they can handle. Faced with excess freight, they may be tempted to subcontract a load to another operator. If handled transparently with the shipper’s approval, this is legal co-brokering. But cutting corners and failing to secure permission makes it double brokering. The result can have severe consequences, including financial penalties or even criminal charges.
Brokers passing loads on: Brokers may occasionally try to cover freight outside their established network. Rather than admit capacity issues, they hand the load to another broker, hoping the shipper won’t notice. If the shipper is not informed, this again is double brokering and therefore illegal.
In both cases, it’s often an attempt to manage too much freight without proper communication. But negligence is no defence — if you don’t follow correct channels, you’re breaking the law.
The fraudulent version
Not all double brokering is an accident. In fact, it’s increasingly being used as a deliberate scam:
- Rogue operators pose as carriers or brokers, accept a load for a set fee, then pass it to another haulier at a lower rate and pocket the difference.
- In more malicious cases, the fraudster disappears entirely — taking the shipper’s payment and leaving the genuine carrier unpaid.
Important Note: Fraudsters exploit carelessness. If you don’t verify the legitimacy of brokers or carriers, your company could be left unpaid for completed work.
How does double brokering harm uk hauliers?
When a load is double brokered, control over the shipment is lost. The shipper no longer knows who is transporting the goods, and legitimate hauliers are exposed to unnecessary risks.
Financial risks: Hauliers risk not being paid for completed work. If goods are damaged, delayed, or disputed, you may struggle to trace the original broker, let alone recover payment. Where fraudulent brokers are involved, they may vanish with the funds, leaving you with no recourse other than lengthy legal action.
Even legitimate shippers can be left out of pocket. Some end up paying twice when a rogue broker disappears without paying the actual carrier.
Liability risks: Insurance claims may be denied if a load has been transported without proper authorisation. In the event of an accident causing injury or death, liability could fall squarely on your company. Insurers will not provide cover for an illegal double-brokered haul.
Reputational risks: Involvement in double brokering, even unknowingly, can ruin a haulier’s reputation. You risk losing your O-licence, being blacklisted by reputable shippers and brokers, and seeing your company’s credibility destroyed.
Important Note: Double brokering exposes hauliers to extreme financial, legal, and reputational risks. In serious cases, it may also result in prosecution.
Conclusion
Double brokering is illegal, unethical, and damaging to the entire transport industry. While it may occur through negligence, it is also being used as a deliberate fraud against unsuspecting hauliers. Either way, involvement, intentional or not, puts your business at serious risk.
Whether you are subcontracting a load or considering taking one on, always secure written authorisation from the shipper. Be thorough, be transparent, and protect your business from the double brokering trap currently spreading across the industry.
Key Takeaways
- Double brokering is the unauthorised transfer of a load to another haulage company. It is illegal, unethical, and damaging to the entire transport industry.
- Sometimes it occurs out of negligence, other times, it is a deliberate act of fraud. Either way, the result is financial loss, liability issues, and damage to reputation.
- This article explains why it happens so frequently, how to avoid it, and the serious financial and legal consequences of being caught in the middle.
eCapital UK
eCapital Commercial Finance (eCapital) is a leading invoice financier providing funding facilities up to £4m to support the growth of SMEs through the provision of flexible working capital facilities. With five fully functional UK regional offices, its local teams are uniquely placed to respond promptly and purposefully to the cashflow needs of its clients. The business has grown significantly since its launch in 2001, providing over £12 billion of funding to businesses. It is majority owned by eCapital, a US based financial services business with interests in the USA and Canada.
