HOUSTON – A Channel 2 investigation found a way tow companies whose licenses have been revoked can continue to operate.
Towing companies and storage facilities in Texas must abide by a very specific set of statutes and if they do not, the compliance team at the Texas Department of Licensing and Regulation can issue administrative orders that oftentimes include stiff penalties.
State records show several Houston towing companies that were fined by the state for violations like towing cars without permission and demanding cash payments to release vehicles.
If a company fails to pay those fines the state can revoke their license. However, there is nothing stopping the owners from continuing to operate a different tow company with a different license if one of their companies' licenses is revoked.
When Nancy Fruhman's car was towed she went on a mission to prove the tow company wrong.
"I was upset, extremely upset, and it cost me almost $400 to buy my own car back out of the storage lot, and that's not the end of the costs," said Fruhman.
The company, Ideal Towing, claimed Fruhman's car was inoperable and that they were authorized by her apartment complex to tow inoperable vehicles.
Fruhman just had the vehicle inspected and said it was completely operational, so she filed to have a tow hearing at the justice of the peace court.
Towing companies fined
TDLR has issued at least three administrative orders against Ideal Towing in the past year with fines totaling $13,900.
One of those fines was for not having the proper towing signage posted.
The sign needs to have a towing logo, a description of all the reasons why towing is enforced, and a telephone number for the storage facility that can be reached 24 hours a day.
Ideal Towing did not respond to requests for comment.
Another company licensed under the name Zibdeh Corp. but doing business as American Eagle and American Eagle Auto Storage, was fined $12,600 for towing cars without a license and then forcing customers to pay cash to pick up their vehicles.
The company's owner said his credit card machine was down at the time of the complaint and that he is no longer towing cars and he has fixed the problem.
The company is under an administrative hold and has a year to pay off the penalties or face losing its license. The owner said he is paying the fine.
AAA M Wrecker has also been reprimanded by TDLR in the past year. Records from the administrative order detail several instances where they towed vehicles from private lots without permission.
In one complaint, a man who identified himself as a disabled veteran claimed that AAA M Wrecker towed him for parking in a handicap area when he was parked there legally.
License Loophole
In September, state records show that TDLR revoked the towing license for Reliant Collision, Inc. after the company failed to pay a previously issued administrative order.
But the owner of that company, Aman Zemzoum, owns another company that still has an active license.
Zemzoum is listed as the owner on the towing license for Auto Haus K&H Inc.
"The violation was against the tow company, not the owner of the tow company. He can own however many tow companies he wants," said Todd Forrester, a program specialist with the compliance division for TDLR.
Forrester contends it would be up to lawmakers to change the law to prevent this.
Sen. John Whitmire (D-Houston) said the state is not to blame.
"I don't think the state needs to regulate that. It ought to be local control. What works for Houston might not work in San Antonio," he said.
Auto Haus K&H did not return a call for comment.
Fighting to get tow fees back
"The first thing consumers should do is get the car out, because it's going to accrue $20 additional a day, every day it sits on the lot. Then you can file for a hearing at JP court," said Forrester.
Forrester said the first step at the hearing is determining if the tow was legal and then at a separate hearing, the judge will determine if the towing company broke the law.
For Fruhman, it took months before she even had her tow hearing, and then once the day arrived she said she had to spend an entire day waiting for her case to be heard.
Eventually, the judge ordered her apartment complex to pay her the money for the tow. She said the complex is now requesting that money from Ideal Towing.
She did not request a second hearing.
TDLR encourages consumers who feel they have been wrongfully or illegally towed to file a complaint and request a tow hearing.
According to Forrester, if the company has broken the statute, the consumer can get $1,000 plus three times the cost of the tow and storage fees.
A common violation involves drop fees.
If a vehicle owner returns to a parking area while a tow truck driver is in the process of conducting a private property tow, the tow truck driver must drop the driver's car.
If the vehicle is fully hooked up to the tow truck, the operator can charge a fee no more than one half of the maximum tow fee. The driver has to accept cash, check, debit or credit card as a form of payment.
According to TDLR's website, "Hooked up means the vehicle is fully prepared for transport by attachment to a tow truck, lifted in tow position, with tow lights and safety chains attached and, if required, placed on a dolly in a raised position, and the only thing remaining is for the tow operator to drive away."
If it's not fully hooked up, the tow truck operator must return the vehicle for free.
"I like to think the vast majority of the companies do play by the rules, but there are some who break the rules, sometimes unintentionally. We do what we can to make sure all of the rules are followed," said Forrester.
The agency lists consumer information about Texas towing rules and regulations on its website.