What Does Fraud Look Like Post-Montgomery?

Freight technology doesn’t move in straight lines. It’s often pulled one direction by market pressure, another by regulation, and another by the slow grind of digital adoption.

Loaded and Rolling host Thomas Wasson sat down with Sean Dehan, vice president of strategy and corporate development at Truckstop, to discuss where those factors have led the industry when it comes to combatting fraud.

Dehan, who joined Truckstop a little over four years ago, arrived at the company during what he now recognizes as a pivotal stretch for trucking. Industry veterans have noted that the last few years have been the worst recession in their lifetimes. Dehan’s response? “I guess I’m proud to have made that one my first.”

At Truckstop, Dehan’s role sits above the day-to-day product roadmap. “I help guide the company on where to invest, where to go, what to build next, where to grow next, how to expand our services for our customers,” Dehan said. He described a mandate that spans product development, partnerships, and potential acquisitions.

His vantage point gives him a read not just on what Truckstop is building, but on where the broader industry is heading. Truckstop’s philosophy, according to Dehan, has always started with the carrier. “Truckstop has always been a company that focuses on the carrier first,” he said.

“We believe we can serve our brokerage customers best if we serve our carrier customers best and first as well.” Carrier-first orientation is structurally built into how a two-sided marketplace functions. “When we build for one side, it typically works for both sides and typically improves both sides,” Dehan said.

But the era of one-size-fits-all tooling, in Dehan’s view, is ending. There are wildly different operational realities within the carrier population. A dry van operation and a flatbed hauler that moves oversized machinery have very different hardships and priorities.

“They might be driving the same tractor with the same engine, but the trailer they’re pulling and the type of freight they’re pulling is all very, very different,” Dehan said. That diversity demands a shift in strategy.

“We’re really focused on building products and tooling that enable carriers to build the business that they want to build and work with the customers that they want to work with,” he said. Part of that shifting strategy, of course, has involved the implementation of new technology.

According to Dehan, though, the industry’s posture toward digital adoption quickly turned once bad actors found ways to exploit it. “Digital adoption can drive a lot of great things, but it can also come with a lot of new challenges,” Dehan said. “AI will bring a lot of amazing things, but it will bring a lot of dark things, too.”

He traced the fraud surge back to the freight brokerage boom years (roughly 2010 to 2022) when growth-hungry brokers pushed for frictionless onboarding to build the largest possible carrier networks. “If you’re providing me with the onboarding solution, I need you to keep that as low friction as possible,” Dehan explained.

That appetite for scale, he said, came with an implicit tolerance for risk. “The fraud that was occurring on the sidelines was just a part of the industry. It was an accepted consequence of running the business,” he said. The pandemic accelerated the problem as new entrants flooded the market with little scrutiny.

“A lot of them were probably fake carriers,” Dehan said. “A lot of them were shell companies. As the market dropped, obviously, the fraud continued and got worse.” The compounding issues then reshaped broker behavior permanently, according to Dehan.

“Even though we’re in this market right now, which is by all accounts tight on a capacity basis, our brokers aren’t really loosening their standards,” Dehan said. “They’re not changing how they procure capacity. They’re just learning how to procure capacity differently than they used to.” The legal landscape has added another layer of urgency.

Dehan pointed to the Montgomery ruling and a subsequent Texas decision he flagged as potentially even more consequential as forces that are pushing brokers toward stricter, more defensible carrier-selection processes.

“The need to have very consistent standards to deliver and display a reasonable care and approach to carrier selection has probably changed some of the pendulum swing,” Dehan said. Rather than layering on new, unvetted data sources in a panicked reaction, brokers are focused on tightening what they already do.

“Brokers are really trying to harden their compliance with the process,” Dehan said. That extends to how exceptions get handled. “Logistics is basically one giant exception, or millions and trillions of giant edge cases and tiny exceptions.”

Carriers get evaluated largely through third-party data they have little ability to contextualize or correct, but Truckstop is working to shift that dynamic. “In a lot of ways when a carrier is being vetted or validated or verified, it is a single