Crackdown on corruption at Bureau of Customs looms

Incoming Finance Secretary Carlos G. Dominguez has directed Bureau of Customs officials to stop corruption in the agency, alongside plans of its incoming chief to foster greater transparency.

“President-elect Rodrigo Duterte is clear on his mandate to go after crime, drugs and corruption. The perception of Customs as the most corrupt agency has to stop,” Dominguez said in a transition meeting Monday attended by outgoing Bureau of Customs (BOC) Commissioner Alberto D. Lina and incoming BOC chief Nicanor Faeldon, among other BOC officials.

The BOC—an attached agency of the Department of Finance—oversees assessment and collections of Customs revenues from 17 of the country’s major air and sea ports while curbing fraud and illicit trade, as well as facilitating trade.

“Beginning now, tell your staff we will not tolerate [corruption]. Complaints are coming from people who are honest. Remember, this election was about issues, that’s why our candidate won even if he spent only 40 percent of what other presidentiables spent,” Dominguez said.

In a statement Tuesday, the incoming finance chief revealed that Halifax Davao Hotel Inc.—one of the firms he owns—had been “offered lower taxation by a Customs official in exchange for a split in the tax savings,” which he had refused.

“We would prefer to pay the full amount to the government as the payment would not make us poor, so we did not cheat,” the Davao City-based businessman said.

Dominguez also lamented that “no culpable Customs officer has been fired until now, with the bureau losing out on cases against erring officials.”

“Have you done enough entrapment operations?” he was quoted as asking BOC officials last Monday.

While Dominguez welcomed recommendations, mostly to improve technology and systems at the BOC and ports, from top-level officials, he pointed out that “what’s more important is leadership.”

“As leaders of the institution, you have to send the message down, and better if you can do it now instead of waiting for June 30,” Dominguez said, referring to the day when President Aquino turns over to Duterte the highest post in the land.

Dominguez instructed BOC officials to inform their respective staff of upcoming changes in the country’s second biggest  revenue collection agency.

“The public is telling us something, and we better listen. Are we going to change? Otherwise, we will have to force it. Send the message down so we don’t have to ram it down their throats,” Dominguez warned.

For his part, Faeldon likewise put forward a number of reform and transparency measures being eyed at the BOC, including the use of the US trade transparency unit as best practice in order to deliver more accurate pricing of products from overseas.

The incoming Customs chief also recommended daily monitoring of shipments’ valuation, although he lamented underinvestment in scanning systems.

Also, Faeldon proposed to benchmark the BOC’s performance in terms of ease of doing business as well as trade facilitation, instead of going after collection targets being set to hit a certain ratio to the gross domestic product.

Faeldon also pushed for 24/7 operations at the BOC.