Customs unravels how 641 containers vanished

The Customs bureau declared to have solved the disappearance of 641 cargo containers from the Manila pier last year. Loopholes have been plugged. Four high officers were recommended for criminal and administrative raps. Summoned to the Palace the other week they were berated by President Rody Duterte. Being a wedding godson from Davao didn’t spare one of them. All were relieved from their posts.

The scam was pulled at the Port of Manila (POM) over six months, Mar.-Sept. 2018. Misdeclared as duty-free “ship spare parts”, 641 twenty-footer containers were released to a false consignee then trucked to the real contrabandists. It happened before Customs Commissioner Rey Leonardo Guerrero’s time. Murmurs at the pier and a happy spike in Port of Manila (POM) collections this year aroused his suspicion, though. His investigators analyzed the countries of origin, weights, and ship stowage plans in bills of lading. Based on the POM’s history of most smuggled goods, the contraband likely were highly dutiable rice, sugar, and cigarettes from China, but rerouted through Singapore and Hong Kong. Government lost about P500 million in revenues from the multibillion-peso fraud.

The 641 containers irregularly passed through the POM’s informal entry division. The IED is only for goods valued at less than P50,000, like Balikbayan boxes; ship spares, usually worth higher although tax-free, should be examined at the formal entry division. With security guards removed earlier for work duplication, the piers and inspection division let the containers through. All contraband were released within 24 hours from arrival.

Questioned was IED examiner Mimosa Maghanoy for allegedly triggering the computer releases. Probers disbelieved her alibi of password hacking, as the smuggling was repeated over six months. Also charged with grave misconduct and conduct prejudicial to the service was IED chief Gliceria Umandap. Purportedly she assigned the clearing of all 641 shipments to Maghanoy, instead of randomly to include two other examiners as well.

As highest POM officers, collector Erastus Sandino Austria and deputy for assessment Florante Ricarte were found administratively neglectful. The IED reports directly to Ricarte, who reports to Austria. Accountable for meeting collection targets, they should have monitored all transactions monthly, weekly, and daily, probers said. For six months, despite the jump in shipments processed at IED, there was no corresponding increase in revenue take. Austria was also Customs spokesman under then commissioner Isidro Lapeña.

“Command responsibility” applies at Customs since 1995, under Executive Order 226. A superior “closely must monitor, supervise, direct, coordinate, and control the activities of subordinates”. He is presumed to know of and thus must stem widespread or repeated irregularity within his jurisdiction. Failure to do so makes him liable for neglect of duty.

Implicated were owners of freight forwarder MMD Logistics as supposed “consignee-for-hire”, and Orophil Shipping International as the importer. Orophil said its name was used without its consent.

Investigators were Atty. Vincent Philip Maronilla, Yasser Abbas, Jeoffrey Tacio and Alvin Ebreo, under co-chairmen Teddy Raval and Raniel Ramiro.

Guerrero has since automated the IED, and linked POM and all ports to the central office. Transactions can be viewed real time, and questionable entries red-flagged. He also reshuffled then suspended 52 port collectors and subs linked to “tara”, regular bribes from smugglers. Duterte has told them to resign or face charges.

Command responsibility is also being used on Austria in the smuggle of P1 billion worth of shabu (meth) in tapioca starch last April. The contraband slipped past the Manila International Container Port, where Guerrero had assigned him as collector or top man in Jan. 2019. Through MICP too had sneaked in tons of shabu stashed in steel printing cylinders in 2017 and magnetic lifters in 2018. Customs chiefs Nicanor Faeldon then Lapeña were sacked for those.

Sen. Panfilo Lacson exposed the ruse in a recent privilege speech. Customs had confiscated and auctioned off the starch. At the buyer’s warehouse a forklift operator accidentally bumped the palettes of starch, spilling the similarly powdery white shabu. The buyer reported to the authorities. Customs and the Philippine Drug Enforcement Agency said they knew all along of the hidden contraband, and purposely auctioned the smuggled tapioca to flush out the drug lord. But Lacson, quoting Customs insiders, said government is required truthfully to detail what it is bidding out, in this case tapioca with shabu. It is further forbidden from auctioning prohibited materials, in this case shabu in tapioca.

Austria, since moved to Davao then suspended, blamed Guerrero and PDEA director general Aaron Aquino for the messy auction. The Senate is to investigate which Customs lawyer proposed it to them.

Nonprofit watchdog Transparency in Public Service is telling Guerrero to tender his courtesy resignation, again under command responsibility. TIPS spokesman Brent de Jesus noted that Guerrero knows the military doctrine well, having been a professional soldier and former Armed Forces chief. “As true officer and gentleman, Guerrero must lead by example and present himself for scrutiny and possible dismissal,” he said.

Malacañang has affirmed that Guerrero “still enjoys trust and confidence of the President.”

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