Sixteen Florida-based interstate moving companies and 74 employees were indicted Tuesday on federal charges they lured hundreds of customers with low estimates, then inflated prices and didn't deliver property until the higher bills were paid. The firms and individuals were charged in eight indictments accusing them of wire fraud, extortion, false billing, money laundering and conspiracy.
Also on Tuesday, legislation was introduced in Congress aimed at stopping such scams. The SCAM Act, for Securing Consumers' Assurance in Moving, authored by Rep. Thomas E. Petri (R-Wis.), would allow individuals and states to use state consumer protection laws to go after the "few bad apples" that cheat consumers, Petri said. It also would impose stiffer penalties and would create a public database of complaints.
State and local authorities rarely prosecute because courts have often ruled they have no jurisdiction in interstate moves, and companies can evade prosecution because the federal government lacks resources to go after them, Petri said. There are five people in the Transportation Department responsible for regulating interstate movers.
The 16 companies indicted Tuesday were contacted by customers over the Internet and offered estimates without evaluating the property, the U.S. attorney's office said. Most of the moves were within Florida, but some were interstate.
The quoted price often was doubled or tripled; in one case, a moving company went as high as seven times the estimate, U.S. Atty. Marcos Jimenez said. "There were hundreds of victims and we're still counting," he said. "There are warehouses ... of goods that have never been returned to these individuals."
The companies are based in Miami-Dade and Broward counties, but investigators said the indictments were part of a nationwide crackdown on unscrupulous moving companies. The indictment identified customers only by initials, with no hometowns.
Since 1998, 15 moving firms and 19 people associated with them nationwide have been charged with fraud, resulting in 16 guilty pleas and more than $3.4 million in restitution to 2,000 defrauded customers, the Transportation Department said.