Hostage Goods

Amy Keller | 10/1/2007

Two years ago, Adam Heward and Meredith Montgomery hired National Movers and Storage of Hollywood to handle their move from Weston to Gainesville. The company gave the couple a quote over the internet and collected a deposit, but after the movers arrived and loaded the truck, the company demanded $1,000 more than the original estimate, according to state records. The customers were told they could pay half the cost when their goods were delivered. Then when the delivery truck showed up eight days late with their household goods, the driver demanded to be paid in cash.

Since 2002, Florida officials have conducted more than 360 investigations of household goods movers and assessed $270,000 in fines. The Florida Attorney General’s office has pursued 22 cases against movers. And the federal government, which regulates the interstate transportation of household goods through the Federal Motor Carrier Safety Administration, has prosecuted more than two dozen moving companies operating so-called “hostage goods” schemes since 2000, concentrating its efforts on south Florida, New York and California.

» Reporting Fraud Florida has a No Fraud Hotline for reporting improper conduct by movers, such as holding cargo hostage until higher fees are paid: 1-866-9-NO-SCAM. In addition, consumers can contact the Division of Consumer Services to file a formal complaint: 1-800-HELP-FLA or 800helpfla.com/moving.html

Among those prosecuted was Majesty Moving and Storage, a Plantation-based company that was accused of extorting $1.23 million from 1,200 victims. Majesty, which primarily advertised over the internet, would lure customers with low moving estimates based entirely on information customers provided via telephone, fax or e-mail. But on moving day, the company would accuse customers of having deliberately withheld information about their goods. After loading furnishings onto the truck, Majesty would demand to be paid two to 10 times the original price. It would then drive the goods to a nearby storage unit.

“If the customer chose not to pay the inflated ‘hostage’ price, the moving company would not make any further rent payments” and the storage facility would eventually auction the customer’s goods, Todd Zinser, acting inspector general for the U.S. Department of Transportation, told a Senate subcommittee last year. Majesty owner Yair Malol is serving a 12-year prison term.

Both the state and federal government have passed laws in recent years cracking down on such scams. Florida law makes it a third-degree felony to hold goods hostage. It also requires movers to provide a written estimate; accept several forms of payment, including cash, check or a major credit card; get a signed contract prior to moving any household goods; and inform the consumer where the goods will be stored prior to delivery. Furthermore, local law enforcement authorities may intervene to help consumers whose goods are held hostage. Consumers may also sue for damages if they’ve been victims of unfair and deceptive practices.

But consumers have fewer legal resources if their goods are being moved across state lines. While Congress made it a felony in 2005 to hold goods hostage, the Federal Motor Carrier Safety Administration lacks law enforcement authority and is precluded from resolving individual complaints.

» 85% to 90% of the more than 3,000 complaints that the Federal Motor Carrier Safety Administration receives each year regarding moving companies are generated in six states: Florida, New York, New Jersey, California, Texas and Illinois. — U.S. Government Accountability Office

Links: Learn how to avoid moving scams
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Tags: Around Florida, Business Services, Housing/Construction