State regulators didn’t carry out some of their required oversight of Uber and Lyft throughout an almost two-year interval, elevating questions on whether or not all drivers who transported Massachusetts passengers in that span have been eligible to take action, in accordance with new audit findings.
Voicing issues that Uber and Lyft have been allowed to function underneath “much looser standards” than state regulation mandates, Auditor Suzanne Bump’s workplace concluded on Tuesday that the company tasked with regulating transportation community corporations fell quick on its background verify and criticism decision duties whereas the audit was underway between Oct. 1, 2017 and Aug. 31, 2019.
Bump’s audit, which drew criticism and disagreement from the Baker administration company it examined, may reignite scrutiny on the pair of gig economic system giants that play a ubiquitous function within the state’s transportation constellation. Transportation community corporations offered 91.1 million rides in 2019, and Bump’s workplace mentioned Uber and Lyft accounted for 99% of journeys throughout the audit interval.
The audit advisable the TNC Division of the Department of Public Utilities add new written insurance policies and procedures to make sure that Uber and Lyft are correctly certifying drivers, taking motion in opposition to those that misplaced permission to make use of the platforms, and reporting complaints in a well timed method.
“The division was created by the Legislature to regulate this emerging industry and was directed to create regulations and to hold the (companies) accountable for the safety of the public. Instead, even after it adopted its regulations, the division allowed the (companies) to operate under much looser standards for a significant period of time and failed to conduct proper oversight,” Bump mentioned in a press release she launched alongside the audit. “Additionally, while the division is now acting in accordance with its regulations, the audit points out several areas of deficiency.”
The TNC Division, which was the topic of Bump’s audit, objected to the audit findings, arguing that the report reached “incorrect assessments” by conflating completely different necessities in place throughout two completely different regulatory intervals.
Craig Gilvarg, a spokesperson for the Executive Office of Energy and Environmental Affairs that homes the DPU, mentioned the state has on its books “the most stringent background check requirements for rideshare drivers in the United States.”
State rules require each transportation community firm to evaluate each applicant’s felony and driving historical past and to conduct a nationwide background verify for each driver not less than twice a yr.
DPU additionally has a program in place to watch felony data for drivers in actual time, which officers say permits regulators to note when a ride-hailing driver is arraigned on a felony cost moderately than wait to detect the offense throughout a background verify.
Bump’s staff flagged a number of points with the use of background checks on potential drivers throughout the audit, which coated a interval shortly after Massachusetts applied new rules on the app-based rides trade.
During that span, Bump’s workplace mentioned, the DPU division carried out just one of the seven required quarterly audits of nationwide background document verify info that Uber and Lyft preserve. That hole means the workplace in cost of regulating Uber and Lyft “cannot be certain that all the TNCs’ rideshare drivers are qualified to work for them,” auditors wrote.
“Delays in quarterly audits could allow unsuitable drivers to provide rideshare services, increasing risks to riders,” they mentioned.
The quarterly audit threshold was some extent of rivalry between Bump and DPU officers, who wrote of their response that they imagine the requirement didn’t kick in till last rules took impact on Feb. 13, 2019.
While the audit was underway, DPU wrote, “only one quarterly audit was required” and was performed in the summertime of 2019. Officials added they’ve “conducted the required audits every quarter since then.”
“The findings in the State Auditor’s report are based on an evaluation of activities that took place in 2017 and 2018, erroneously evaluating those activities based on regulations and permits that were not applicable until February 2019,” Gilvarg mentioned. “The TNC Division has faithfully enforced those regulations and permits for the past two and a half years, and will continue to prioritize public safety, maintain a rigorous driver eligibility standard, and perform broad oversight to ensure the safety and security of all TNC riders in the Commonwealth.”
Auditors sampled 53 driver functions submitted to TNCs throughout the audit interval and located two situations through which the people handed firm nationwide background document checks regardless of felony or driving histories that “should have precluded them” from engaged on the platforms. Neither of these drivers cleared state evaluate, in order that they finally didn’t present any rides to passengers.
The auditor’s workplace additionally discovered the businesses didn’t at all times carry out six-month nationwide background document checks for his or her drivers — a conclusion state regulators known as “not correct” — and that the DPU didn’t conduct enough oversight to make sure transportation community corporations denied ineligible drivers from engaged on their platforms.
Complaints posed one other purple flag for Bump’s staff, which decided that DPU solely started to obtain required month-to-month criticism reviews from the businesses beginning in January 2019. Some of these complaints “were deficient and did not contain information on actions TNCs had taken to resolve the complaints,” the audit discovered.
DPU officers once more argued that the month-to-month criticism requirement didn’t start till last rules took impact in February 2019.
“The majority of these complaints relate to payment issues, account problems, and pick-up/dropoff locations,” DPU wrote. “The Division intends to pursue a stakeholder consultation process to determine if it would be helpful to establish guidelines to govern the required monthly complaint reports. The Division will use that process to determine whether any changes to the regulation requiring these reports are appropriate.”
Gov. Charlie Baker’s push to strengthen security rules on ride-hailing corporations and gather extra granular knowledge in regards to the rides they provide stays stalled within the Legislature, which allowed a invoice he filed to die with out motion final session and has not touched the newest model (S 2436) since sending it to the Transportation Committee in April.
Neither Uber nor Lyft responded to a News Service request for touch upon the audit’s findings.