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Man pleads guilty to moving scheme
By eTrucker Staff
A former foreman for a household goods moving company pled guilty Oct. 9 in U.S. District Court in New York City to a scheme of fraudulently inflating the cost of moving customers’ household goods.
Pablo Morales, previously employed with Adam Moving and Storage of Brooklyn, participated in a scheme to provide AMS customers with low-ball estimates, only to have the cost of the move increased -- in some cases doubled or tripled -- after the customers’ property was loaded on the moving truck, according to the Department of Transportation's Office of the Inspector General. AMS would not release the customers’ goods until they agreed to pay the artificially inflated rate, DOT-OIG said.
As part of his plea, Morales admitted to conducting this scheme on a move that was paid for by the Department of Defense, according to DOT-OIG; investigation of AMS was initiated based on information received from the Federal Motor Carrier Safety Administration alleging that AMS violated FMCSA regulations for failing or refusing to furnish an estimate in writing.
As of May 2001, FMSCA had received about 75 complaints alleging that AMS had been holding customers’ household goods hostage until the customer paid an artificially inflated amount, DOT-OIG said; during a compliance review, FMCSA found that AMS had an established pattern of providing binding estimates to their customers that would be fraudulently inflated upon delivery. Federal regulations prescribe that the maximum a carrier can demand at time of delivery is no more than 10 percent over the nonbinding estimate amount.
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