The Interstate Commerce Commission yesterday changed 12 major trading companies and their executives with withholding nearly $2.5 million in duplicate payments from shippers.
But the civil suits were called [WORD ILLEGIBLE] the tip of the interest by Ivan Schaeffer chief of the ICC's bureau of investigations and enforcement. He estimated the scope of the nationwide duplicate payments scheme as "conservativelyover $2 billion."
Schneffer said that 20 per cent of all terms investigated were quilty of double billing and pocketing the over-payments in violation of ICC regulations.
The complaints change that after truckers were paid [WORD ILLEGIBLE] by a shipper through prepayments or collect of back payments, they would bill the shipper again. When the second payment came through, the trucker would keeps the money unless the shipper discovered the overpayment and asked for its return.
"The result is that the public is being billed out of the money," Schaeffer said, "because the shippers are just passing the added costs on to the consumer."
The 12 firms named in suits filed in U.S. District Courts in Chicago, Indianapolis and Milwaukee, were Advance Transportation Co. of Milwaukee Gateway Transportation Co. of LaCrusse, Wis., O.E. Motor Service of Summit, Ill. Strum Freight ways of Peoria, Ill.Long Transportation of Detroit, Liberty Trucking of Chicago. Freeport [WORD ILLEGIBLE] Freight of Chicago, Brada-Miller Freight System of Kokomo, Ind., Turner Trucking of Lebanon, Ind., Cracker Express Co. of Milwaukee, NW Service System of Detroit and Sim Motor Transport Lines of Chicago.
Gateway alone was accused of pocketing $139 million in double payments or 1.3 per cent of its total revenues for 1976, the ICC said.
Neil Aschemeyer vice president and general counsel of Gateway, said yesterday he would not comment on the case until he had a chance to [WORD ILLEGIBLE] complaints.
"We do not believe that the practices uncovered by the commission's investigations involving those 12 carriers are isolated instances," Schaeffer said. "We fear that this could prove to be the tip of a very expensive iceberg which hurts shippers who lose the use of their capital and injures consumers who ultimately share in the double payments through higher prices for merchandise."
The lawsuits seek to had the firms from continuing the double billing practices and would require them to identify all duplicate payments made in the past three years that were not refunded and make the necessary rebates.
Among the companies that were billed twice were Westinghouse Electric Co., International Harvester, American Motors Corps., Bendix Corp., Firestone Tire & Rubber Co., and United Air Lines.