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Protecting Consumers from Fraudulent Practices in the Moving Industry

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Protecting Consumers from Fraudulent Practices in the Moving Industry S. HRG. 109–529 PROTECTING CONSUMERS FROM FRAUDULENT PRACTICES IN THE MOVING INDUSTRY HEARING BEFORE THE SUBCOMMITTEE ON SURFACE TRANSPORTATION AND MERCHANT MARINE OF THE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION UNITED STATES SENATE ONE HUNDRED NINTH CONGRESS SECOND SESSION MAY 4, 2006 Printed for the use of the Committee on Commerce, Science, and Transportation ( U.S. GOVERNMENT PRINTING OFFICE 28–212 PDF WASHINGTON : 2006 For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800 Fax: (202) 512–2250 Mail: Stop SSOP, Washington, DC 20402–0001 VerDate 0ct 09 2002 10:17 Aug 23, 2006 Jkt 028212 PO 00000 Frm 00001 Fmt 5011 Sfmt 5011 S:\WPSHR\GPO\DOCS\28212.TXT JACKF PsN: JACKF SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION ONE HUNDRED NINTH CONGRESS SECOND SESSION TED STEVENS, Alaska, Chairman JOHN MCCAIN, Arizona DANIEL K. INOUYE, Hawaii, Co-Chairman CONRAD BURNS, Montana JOHN D. ROCKEFELLER IV, West Virginia TRENT LOTT, Mississippi JOHN F. KERRY, Massachusetts KAY BAILEY HUTCHISON, Texas BYRON L. DORGAN, North Dakota OLYMPIA J. SNOWE, Maine BARBARA BOXER, California GORDON H. SMITH, Oregon BILL NELSON, Florida JOHN ENSIGN, Nevada MARIA CANTWELL, Washington GEORGE ALLEN, Virginia FRANK R. LAUTENBERG, New Jersey JOHN E. SUNUNU, New Hampshire E. BENJAMIN NELSON, Nebraska JIM DEMINT, South Carolina MARK PRYOR, Arkansas DAVID VITTER, Louisiana LISA J. SUTHERLAND, Republican Staff Director CHRISTINE DRAGER KURTH, Republican Deputy Staff Director KENNETH R. NAHIGIAN, Republican Chief Counsel MARGARET L. CUMMISKY, Democratic Staff Director and Chief Counsel SAMUEL E. WHITEHORN, Democratic Deputy Staff Director and General Counsel LILA HARPER HELMS, Democratic Policy Director SUBCOMMITTEE ON SURFACE TRANSPORTATION AND MERCHANT MARINE TRENT LOTT, Mississippi, Chairman TED STEVENS, Alaska DANIEL K. INOUYE, Hawaii, Ranking JOHN MCCAIN, Arizona JOHN D. ROCKEFELLER IV, West Virginia CONRAD BURNS, Montana BYRON L. DORGAN, North Dakota KAY BAILEY HUTCHISON, Texas BARBARA BOXER, California OLYMPIA J. SNOWE, Maine MARIA CANTWELL, Washington GORDON H. SMITH, Oregon FRANK R. LAUTENBERG, New Jersey GEORGE ALLEN, Virginia E. BENJAMIN NELSON, Nebraska JOHN E. SUNUNU, New Hampshire MARK PRYOR, Arkansas DAVID VITTER, Louisiana (II) VerDate 0ct 09 2002 10:17 Aug 23, 2006 Jkt 028212 PO 00000 Frm 00002 Fmt 5904 Sfmt 5904 S:\WPSHR\GPO\DOCS\28212.TXT JACKF PsN: JACKF C O N T E N T S Page Hearing held on May 4, 2006 ................................................................................. 1 Statement of Senator Allen ..................................................................................... 2 Statement of Senator Lott ...................................................................................... 1 Statement of Senator Pryor .................................................................................... 11 Prepared statement .......................................................................................... 11 Statement of Senator Stevens ................................................................................ 26 WITNESSES Curran, Jr., J. Joseph, Attorney General, State of Maryland .............................. 12 Prepared statement .......................................................................................... 15 Letter, dated January 21, 2004, from the National Association of Attor- neys General .................................................................................................. 16 Edge, Kay F., Assistant Professor of Architecture, School of Architecture and Design, Virginia Tech ................................................................................... 26 Prepared statement and attachments ............................................................ 27 Harrison, Joseph M., President, American Moving and Storage Association ..... 43 Prepared statement .......................................................................................... 45 Hoemann, Warren, Acting Administrator, Federal Motor Carrier Safety Ad- ministration .......................................................................................................... 20 Prepared statement .......................................................................................... 21 Kelly, J.R., Director, Division of Consumer Services, Florida Department of Agriculture and Consumer Services ................................................................... 41 Prepared statement .......................................................................................... 42 Sakamoto-Wengel, Steve, Deputy Chief, Consumer Protection Division, Office of the Attorney General, State of Maryland ...................................................... 57 Zinser, Todd J., Acting Inspector General, Department of Transportation ........ 4 Prepared statement .......................................................................................... 6 APPENDIX Inouye, Hon. Daniel K., U.S. Senator from Hawaii, prepared statement ........... 61 Response to Written Questions Submitted by Hon. Daniel K. Inouye to: J. Joseph Curran, Jr. ....................................................................................... 63 Kay F. Edge ...................................................................................................... 66 Joseph M. Harrison .......................................................................................... 71 Warren Hoemann ............................................................................................. 64 J.R. Kelly ........................................................................................................... 71 Todd J. Zinser ................................................................................................... 62 Response to Written Questions Submitted by Hon. Frank R. Lautenberg to: Warren Hoemann ............................................................................................. 65 Todd J. Zinser ................................................................................................... 63 U.S. Chamber of Commerce, prepared statement ................................................. 61 (III) VerDate 0ct 09 2002 10:17 Aug 23, 2006 Jkt 028212 PO 00000 Frm 00003 Fmt 5904 Sfmt 5904 S:\WPSHR\GPO\DOCS\28212.TXT JACKF PsN: JACKF VerDate 0ct 09 2002 10:17 Aug 23, 2006 Jkt 028212 PO 00000 Frm 00004 Fmt 5904 Sfmt 5904 S:\WPSHR\GPO\DOCS\28212.TXT JACKF PsN: JACKF PROTECTING CONSUMERS FROM FRAUDULENT PRACTICES IN THE MOVING INDUSTRY THURSDAY, MAY 4, 2006 U.S. SENATE, SUBCOMMITTEE ON SURFACE TRANSPORTATION AND MERCHANT MARINE, COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION, Washington DC. The Subcommittee met, pursuant to notice, at 10:05 a.m. in room SD–562, Dirksen Senate Office Building, Hon. Trent Lott, Chairman of the Subcommittee, presiding. OPENING STATEMENT OF HON. TRENT LOTT, U.S. SENATOR FROM MISSISSIPPI Senator LOTT. The hearing will come to order. Thank you, panel, for being here this morning and for being in your places. We are going to need to move right along this morning because we know that some of you have other commitments, and also the Senate will be having a series of votes beginning at 11 a.m. So I hope we can be done with our proceedings here by about 11:15 a.m. or so. So if you would summarize your statement, we will put your full state- ment in the record, and then it will give me an opportunity and perhaps other Senators that will be here. We do have an indication that Senator Stevens and Allen and Inouye, Lautenberg, and Pryor and perhaps others will come by this morning. Thank you for this opportunity for us to pursue an issue that we worked on last year. We want to make sure that during this hearing that we think care- fully about the best way to protect consumers from fraudulent practices in the moving industry, and also to make sure that the moving industry is not unfairly maligned and that they are part of decisions we make as to how we are going to handle issues and complaints in the future. Without going into the history, we all know that in 1995, before Congress abolished the ICC, the Inter- state Commerce Commission, that agency had 94 individuals in field offices available to directly assist customers and consumers that experienced problems. There were an additional 18 head- quarters’ employees. When Congress abolished the ICC and trans- ferred jurisdiction over the moving industry to the Department of Transportation, only a handful of employees were assigned to work on this problem. So it comes as little surprise that complaints by consumers skyrocketed. And last year, when we were having hear- ings on this part of SAFETEA–LU, the highway bill, I was frankly (1) VerDate 0ct 09 2002 10:17 Aug 23, 2006 Jkt 028212 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 S:\WPSHR\GPO\DOCS\28212.TXT JACKF PsN: JACKF 2 surprised by the number of complaints and the difficulties that had been encountered. It really took me aback because I didn’t realize that there were so many and the magnitude of them and the dif- ficulty in how one would get redressed. Mark Pryor, our Senator on the Committee here from Arkansas, former Attorney General, was particularly interested in this and concerned about it, so we tried to come up with language that would allow us to have some better ways to address this problem. And so, we did have language that I included in the bill, the highway bill, entitled Household Goods
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