"We will not hesitate to immediately shut down a bus or truck company that ignores safety regulations and puts innocent lives at risk," said Anne Ferro, administrator of the department's Federal Motor Carrier Safety Administration.
The Fung Wah bus service shut down earlier this week after it was barred from operating out of Boston's South Station bus terminal. That came after its entire 28-bus fleet was pulled off the road when Massachusetts inspectors found various problems, including cracked bus frames. The company temporarily kept running, in part by using chartered buses.
Department of Transportation officials said once Fung Wah stopped cooperating with safety investigators it was able to revoke its operating authority registration under a law passed in July.
"Bus companies that jeopardize public safety and refuse to cooperate with our investigators have no place on the road, and now, thanks to our additional authority, we can take them off," said U.S. Transportation Secretary Ray LaHood.
No one answered at a New York number for Fung Wah and it was not possible to leave a message.
The company has attracted customers with its frequent trips and low cost tickets - $15 for most trips. But it's had problems in the past, including a $31,000 fine in 2006 for safety violations after a rollover accident in Massachusetts injured dozens of passengers. Its drivers rate in the bottom 3 percent nationwide for driver fitness, a measure of training and experience, according to safety evaluations by the Federal Motor Carrier Safety Administration.