BASIC Score Disclaimers Are Core Of A Third Party Brokers Defense – Part 8

In Part 7 of our Busting Brokers series, we looked at Anticipating their Defense. Now we drill down to the specific issues surrounding the disclaiming of BASIC scores.

Disclaimer On BASIC Scores

Another popular stratagem used by the brokers is the “disclaimer” that is located at the bottom of the SMS website screen when looking up a motor carrier’s BASIC scores.  That disclaimer currently reads as follows:

The data in the Safety Measurement System (SMS) is performance data used by the Agency and Enforcement Community. A  symbol, based on that data, indicates that FMCSA may prioritize a motor carrier for further monitoring. The  symbol is not intended to imply any federal safety rating of the carrier pursuant to 49 USC 31144. Readers should not draw conclusions about a carrier’s overall safety condition simply based on the data displayed in this system. Unless a motor carrier in the SMS has received an UNSATISFACTORY safety rating pursuant to 49 CFR Part 385, or has otherwise been ordered to discontinue operations by the FMCSA, it is authorized to operate on the nation’s roadways. Motor carrier safety ratings are available at and motor carrier licensing and insurance status are available at

Expect the broker to argue that this disclaimer means the BASIC scores are only for use by the FMCSA and State enforcement personnel to identify motor carriers for further monitoring, and that they should not be used by others (including brokers) to determine whether a carrier is safe.
We Don’t Have To

Another argument Brokers like to use is that there is no requirement under Federal Regulations that they check the carriers’ safety statistics.  Again, the argument brokers attempt to make is that the Federal Government is charged with giving a “safety rating” and giving the carrier authority to haul loads on our roads. Similarly, the March 2011 “Carrier Selection Framework” published by the Transportation Intermediaries Association (“TIA”) itself states that:  “[i]t has been, and remains, TIA’s consistent position that the FMCSA Safety Rating alone determines a motor carrier’s fitness for use, and should always take precedence over, and clearly outweigh, any single score, or collection of scores, or data set, including CSA’s SMS or BASIC scores.”

BASIC Scores Are Not Accurate

Brokers attempt to argue that the BASIC scores themselves are not accurate and therefore should not be utilized. They argue that the scores themselves have no relationship to accident frequency, and that the scores relating to a particular motor carrier are an unreliable, inadequate and improper method of estimating that particular motor carrier’s probability of being in a future accident. There are a number of sources that brokers attempt to use in crafting this argument. For example, the following sources are among those that have been relied upon in arguing the BASIC scores are not accurate and should not be relied upon:

Why CSA Is Not Fit for Shippers and Brokers to Use, Stifel Nicolaus conference call on January 5, 2012.  This conference call featured a number of transportation industry speakers, including Tom Sanderson, who stated that “[t]he SMS scores have no relationship to accident frequency.”

REGULATORY ROULETTE:  Assessing CSA, Equity Research paper by Wells Fargo Securities Senior Analyst Anthony P. Gallo, dated March 28, 2011.  In this analysis/study, Mr. Gallo states that they believe the composite BASICs scores do not provide a true depiction of a carrier’s safety, and THAT they did not find that composite scores were indicative of accidents or injuries/fatalities.

CSA:  Good Intentions, Unclear Outcomes, Equity Research paper by Wells Fargo Securities Senior Analyst Anthony P. Gallo, dated November 4, 2011.  In this analysis/study nearly a year after the initial implementation of CSA, Mr. Gallo states that they “remain convinced investors and other interested parties should NOT rely exclusively on a carrier’s composite BASIC scores to assess accident probability or overall risk.  Indeed, we believe the composite scores can be misleading.”  (page 2)

CSA:  Another Look With Similar Conclusions, Equity Research paper by Wells Fargo Securities Senior Analyst Anthony P. Gallo, dated July 2, 2012.  Mr. Gallo offers another paper, this one following the UMTRI report, and again maintains that there is no meaningful statistical relationship between BASIC scores and crash rates for Unsafe Driving, Fatigued Driving, Driver Fitness, or Vehicle Maintenance.

Understanding CSA, December 2012 presentation by Wells Fargo Securities, Anthony P. Gallo.  Again, Mr. Gallo asserts that there is no meaningful statistical relationship when using simple regression analysis between bad BASIC scores and actual accident occurrence.

Compliance, Safety, Accountability:  Analyzing the Relationship of Scores to Crash Risk, American Transportation Research Institute, October 2012.   This is an extensive analysis of the BASIC scores, and brokers have focused on the portion of the analysis that found a negative relationship between the Driver Fitness and Controlled Substance/Alcohol BASIC categories and crash risk.

Statistical Issues in the Safety Measurement and Inspection of Motor Carriers, James Gimpel, University of Maryland, May 2012.  In this analysis by Professor James Gimpel from the University of Maryland, Dr. Gimpel claims that the “statistical relationships detected in these data are not only a cloudy reflection of the true population, but may well be flat wrong.”  He claims that only a small share of motor carriers are inspected each year, and due to local peculiarities and biases in the selection process, the resulting data collection is an imperfect representation of the overall carrier population, especially small carriers.  He further claims that the various measurements are subject to wide variation in emphasis and application based from location to location geographically.

SMS BASIC Scores are Not Valid Predictors of Crash Frequency, Inam Iyoob, Ph.D.   In this study, purportedly performed at the request of the organization “Alliance for Safe, Efficient and Competitive Truck Transportation” (“ASECTT”), self styled data analyst and mathematical expert Inam Iyoob, Ph.D. prepared a statistical analysis refuting the FMCSA’s analysis that showed a relationship between BASICs and crash risk.  Dr. Iyoob claims that “it is not statistically accurate to say the SMS methodology and BASIC percentile scores are an accurate predictor of carrier safety predicated upon the crash data the Agency uses to justify its conclusions….[T]he way the SMs Basics Unsafe Driving and Fatigued Driving are captured, calculated and interpreted by FMCSA does not show any correlation to crashes.  Hence usage of SMS data for carrier selection will unduly favor some and penalize others, and thus should be avoided.”

In Part 9 of our series on Busting Brokers, we will go over how to Counter Their Defense.

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