Audit of the Department of Public Utilities

This is a state performance audit of the Massachusetts Department of Public Utilities, focused on its oversight of rideshare companies during October 1, 2017 through August 31, 2019.

“This report details the audit objectives, scope, methodology, findings, and recommendations for the audit period, October 1, 2017 through August 31, 2019.”

Auditors wanted to know whether the rideshare oversight division made sure drivers were allowed to drive and whether complaints about drivers and riders were investigated and resolved.

“The purpose of this audit was to determine whether DPU’s Transportation Network Company Division ensured that transportation network companies’1 (TNCs’) drivers were eligible to provide rideshare services2 and whether the division ensured that TNCs investigated and resolved consumer complaints against rideshare drivers3 and riders.”

If driver background checks and complaint follow-up are weak, riders and drivers may face avoidable safety risks.

“This issue creates an elevated safety risk for riders and drivers.”

If you use rideshare services in Massachusetts, this audit is about whether the state was checking that rideshare companies kept unsafe or ineligible drivers off their apps and took complaints seriously.

“An audit also allows the division to determine whether drivers whose Clearance Certificates have been suspended or revoked were promptly barred from accessing a TNC’s digital network.”

The state division did some background checking itself, but it did not adequately monitor whether rideshare companies did their required checks, removed ineligible drivers, or fully reported complaint handling.

“During our audit period, the Transportation Network Company Division did not effectively monitor transportation network companies (TNCs) to ensure that they conducted national background record checks of all rideshare drivers.”

The auditor recommended that the division create written rules and monitoring systems for audits, driver removals, and complaint reports.

“The Transportation Network Company Division should establish written policies and procedures for auditing TNCs and establish a monitoring process to ensure that TNCs take appropriate actions against rideshare drivers whose Clearance Certificates have been suspended or revoked.”

This matters because rideshare use was very large in Massachusetts, with tens of millions of trips each year during the period discussed.

“According to the Transportation Network Division’s website, there were approximately 64.8 million rideshare trips that went through TNCs’ digital networks during calendar year 2017 and approximately 81.3 million rideshare trips during calendar year 2018.”

A transportation network company, or TNC, means a rideshare company that uses an app or digital system to connect riders with drivers.

“Section 1 of Chapter 159A1/2 of the General Laws defines “transportation network company” as “a corporation, partnership, sole proprietorship or other entity that uses a digital network to connect riders to drivers to pre-arrange and provide transportation.””