If a broker does not pay you, your options run from a certified demand letter to a lawsuit with post-judgment collection, and for freight and securities brokers there are specialized paths — a surety bond claim or FINRA arbitration — that can get you paid without a courtroom. The sequence below moves from cheapest to most aggressive. Starting at the top costs little and builds the paper trail you’ll need if the dispute escalates.
Pull Your Paperwork Together First
Every step that follows depends on documents. Gather the signed broker agreement, invoices, rate confirmations, proof of performance or delivery, and any closing statements. For a carrier chasing a freight broker, the bill of lading matters most because it proves you moved the load.
Add every written exchange with the broker: emails, texts, portal messages, and notes from phone calls. Informal admissions like “we’ll get that payment out next week” become evidence. Put everything in chronological order so the timeline of when payment came due and when the broker went silent is obvious at a glance.
Then read the contract with four questions in mind: What is the payment deadline (often net 30 or net 45)? What is the commission or rate? Are there late-payment penalties or interest? And what does the dispute resolution clause require? That last one shapes everything. If the contract mandates mediation or arbitration before litigation, filing a lawsuit first can get your case dismissed.
Send a Certified Demand Letter
A formal demand letter is the cheapest tool and it resolves more disputes than people expect. A broker who has been ignoring casual follow-ups often responds differently to a written demand that signals a courtroom or regulator is next.
Keep it factual. Identify the service you performed, the date you completed it, the exact amount owed, and the contract provision that establishes the obligation to pay. Set a firm deadline — 10 to 15 business days is standard — and state plainly that you intend to pursue legal remedies or file a bond claim if payment does not arrive.
Send it by USPS Certified Mail with Return Receipt Requested so you have signed proof of delivery. Some senders email a duplicate so the broker cannot claim a mail delay, but the certified copy is what carries evidentiary weight.
One boundary to know: because this is a business-to-business debt, the Fair Debt Collection Practices Act does not apply to your own collection efforts. That statute covers consumer debts. You are not bound by its restrictions when writing to the broker or following up by phone.
File a Claim Against the Broker’s Surety Bond
For freight brokers, this is often the fastest route to your money and it does not require an attorney. Federal law requires every property broker registered with the FMCSA to maintain a surety bond or trust fund of at least $75,000, regardless of the number of offices or agents.1Office of the Law Revision Counsel. 49 USC 13906 – Security of Motor Carriers, Motor Private Carriers, Brokers, and Freight Forwarders The bond exists to pay carriers and shippers when the broker fails to cover freight charges.
Look up the broker on the FMCSA’s Licensing and Insurance portal. The listing identifies the surety company or trustee. Contact the surety directly, submit a written claim, and include your rate confirmation, proof of delivery, unpaid invoice, and the broker-carrier agreement. The surety has to respond within 30 days. If the broker consents, the surety pays. If the broker ignores the notice, the surety can evaluate and pay independently. If neither happens, you can reduce the debt to a court judgment and collect against the bond, and the prevailing party in an action against the surety is entitled to reasonable costs and attorney’s fees.1Office of the Law Revision Counsel. 49 USC 13906 – Security of Motor Carriers, Motor Private Carriers, Brokers, and Freight Forwarders
One catch: the $75,000 bond covers all claims against that broker. If several carriers file at once and the total exceeds the bond, recoveries are prorated. Moving quickly matters.
File a Regulatory Complaint
A complaint to the broker’s licensing authority does not put money in your account directly, but it can trigger an investigation, fines, license suspension, or revocation. The threat of that often motivates payment. The right agency depends on the industry: freight brokers answer to the FMCSA, real estate brokers to state real estate commissions, insurance brokers to state insurance departments, and securities broker-dealers to the SEC and FINRA. Complaint forms sit on each agency’s website.
Securities Brokers: FINRA Arbitration Is Mandatory
If the person or firm that owes you is a FINRA member or an associated person, and the dispute arose from business activities — including unpaid commissions — you must arbitrate under FINRA’s Code of Arbitration Procedure for Industry Disputes. You file a signed Submission Agreement, a statement of claim describing the facts and the amount sought, and the filing fee through FINRA’s online portal. If you prevail, the respondent has 30 days to pay the award. Ignoring a FINRA award is itself a rule violation and can bring additional sanctions against the broker’s registration.2FINRA.org. 13000 Code of Arbitration Procedure for Industry Disputes
Hand It to a Commercial Collection Agency
If you don’t want to run the chase yourself but aren’t ready to sue, a commercial collection agency sits in the middle. Most work on contingency, so nothing is due upfront and the agency takes a percentage of what it recovers. Older debts cost more. Agencies rely on persistent letters, calls, and credit reporting, which works well on brokers who are disorganized or short on cash but less well on ones who are insolvent or who know an agency cannot compel payment on its own. If collection fails, the account usually goes to an attorney for litigation, adding another layer of contingency fees.
The choice between an agency and a lawyer comes down to size and behavior. Moderate debts owed by a broker who can pay but isn’t paying suit an agency. Large debts, actively disputed obligations, or multi-state situations argue for a lawyer.
Sue in the Right Court
When letters, bond claims, and collection efforts have run their course, litigation is the remaining option. Small claims court handles disputes up to a cap that varies by jurisdiction, typically between $2,500 and $25,000, using simplified procedures that generally do not require an attorney. Above that cap, you file in a higher civil court with formal pleadings, discovery, and possibly a trial, and representation matters more.
Before filing, check the dispute resolution clause again. If it requires arbitration or mediation first, follow that path. Filing suit when the contract mandates arbitration wastes fees and time when the court dismisses the case.
Freight Broker Suits Come with Fee-Shifting
Carriers suing freight brokers have a real advantage. A broker providing transportation services is liable for damages resulting from violations of federal transportation regulations, and the court is required to award reasonable attorney’s fees to the prevailing party.3Office of the Law Revision Counsel. 49 USC 14704 – Rights and Remedies of Persons Injured by Carriers or Brokers The broker pays your legal costs if you win, which makes lawsuits economically viable even at claim sizes that would otherwise not justify the expense of hiring counsel.
Ask for Interest
Your recovery isn’t limited to the invoice amount. If the contract includes a late-payment interest clause, claim interest from the date payment was due. Even without one, most jurisdictions allow prejudgment interest on overdue commercial debts. The rate depends on the state — some use a fixed statutory rate, others tie it to a published index. Raise the issue in your complaint or demand so any judgment includes it.
Enforcing the Judgment
Winning a judgment is only half the job. A court order saying the broker owes you $20,000 does not automatically move money into your account. Post-judgment enforcement tools do that work.
The two most common are wage garnishment and bank levy. A garnishment order directs the broker’s employer to send a share of earnings straight to you. Federal law caps garnishment for ordinary debts at 25% of the debtor’s disposable earnings per pay period, or the amount by which those earnings exceed 30 times the federal minimum wage, whichever is less.4Office of the Law Revision Counsel. 15 USC 1673 – Restriction on Garnishment A bank levy seizes funds directly from the broker’s account.
Other tools include liens on real property, a debtor’s examination that compels the broker to disclose assets under oath, and in some jurisdictions, seizure of business equipment or accounts receivable. Local court rules govern the procedures, and many judgment creditors hire an attorney who focuses on collections to run the process.
Watch the Statute of Limitations
Every claim has an expiration date. The statute of limitations for breach of a written contract ranges from three years in a handful of states to ten or more in others, with most falling in the three-to-six-year range. Once it closes, you lose the right to sue no matter how strong your evidence. The clock usually starts on the date payment was due, not the date you realized the broker wouldn’t pay.
That deadline shapes your leverage in negotiation. A broker who knows the limitations period is closing in has every reason to stall. If a deadline is near and informal talks haven’t produced payment, file a protective lawsuit or arbitration claim to preserve your rights. You can always settle or dismiss later; you cannot revive a time-barred claim.
If You Never Collect: The Tax Side
Tax treatment of an uncollected broker payment depends on your accounting method. Most individuals and small businesses use the cash method, reporting income when it is actually received. Under cash-method accounting, an unpaid broker commission or fee was never on your return, so there is nothing to deduct — you cannot write off money you never reported receiving.5Internal Revenue Service. Topic No. 453, Bad Debt Deduction
Accrual-method taxpayers report income when earned. If you reported the broker’s payment on a prior return and the debt later becomes worthless, you may be able to claim a business bad debt deduction. You have to show you took reasonable steps to collect and that no realistic expectation of payment remains. The deduction goes on Schedule C or the applicable business return for the year the debt becomes worthless.5Internal Revenue Service. Topic No. 453, Bad Debt Deduction If you’re unsure whether you qualify, this is one area where a short conversation with a tax professional pays for itself.