RATS in a rat hole

After being sworn into office last month, Customs Commissioner Rozzano “Ruffy” Biazon got marching orders from President Benigno “Noynoy” Aquino III to strictly implement the provisions of the Customs and Tariff Code. By doing so, the Customs bureau is expected to effectively curb smuggling and, in the process, raise much-needed revenues for the government.

As one of the top five tax-collecting agencies of the government, the Customs bureau was tasked to collect P320 billion in revenues this year. It was bruited about in talk emanating from Malacañang Palace that rampant smuggling and failure to meet revenue collection targets cost the job of Biazon’s immediate predecessor, Angelito Alvarez.

Before he stepped down from his post, Alvarez conceded the agency might only be able to collect P295 billion by the end of this year because of tariff reductions and fluctuations in the peso-dollar exchange rate. Revenue losses due to smuggling and corruption were presumably not included in his calculations.

P-Noy removed Alvarez and placed his own trusted people at the Customs bureau. The Chief Executive installed into office the former Muntinlupa City congressman along with ex-Brig. Gen. Danilo Lim as deputy Customs commissioner.

Biazon and Lim both ran but lost under the Liberal Party (LP) senatorial slate of P-Noy in the May 2010 elections. Biazon is the son of former senator and now Muntinlupa City Rep. Rodolfo Biazon (LP). Lim, one of the accused in the failed “Magdalo” coup during the previous administration, was obviously tapped for his military background that he could apply to improve intelligence operations against smuggling and other fraudulent activities at the Customs bureau.

The tandem of Biazon and Lim need not reinvent the wheels to perform their jobs. All they have to do is continue, or better yet, intensify the Run After the Smugglers (RATS) campaign. Since the Aquino administration took over on June 30 last year, the RATS campaign has aggressively filed cases against suspected smugglers and their cohorts in the government.

Obviously taking to heart P-Noy’s all-out campaign to stamp out corruption in and out of the government, the RATS group reported filing at least 44 smuggling cases as of Sept. 22 this year. Roughly, this means an average of three cases every month.

The total dutiable value involved in these smuggling cases amounted to almost P60 billion. This translates to an average of P1.4 billion in dutiable values collectible in each case. For better appreciation of these figures, this also contributed P551 million in cash to the revenue collection of the agency out of incremental payments from duties and taxes on questionable values and special investigations conducted by the RATS.

Of the 44 cases, one case has been resolved and already filed in court by the Department of Justice (DOJ). This involved the smuggling case filed in August last year against Viking Haulers Inc. for allegedly evading payment of P85.9 million in duties for its importations. On the other hand, 21 cases filed by RATS with the DOJ were already submitted for resolution while seven cases are pending preliminary investigation and 15 others are up for preliminary investigation.

However, there is the specter of these cases going nowhere and efforts to collect unpaid duties being wasted following an unexpected turn of events. Eight Customs officials assigned to RATS literally found themselves in a rat hole.

This, after a Palace official issued a 90-day suspension order against them based on an administrative complaint filed by Sanyo Seiki Stainless Steel Corp. (SSSSC), a company they had charged with smuggling. The RATS filed on Jan. 20 this year a smuggling case against SSSSC president Gregory Uy Chan for his company’s alleged mis-declaring, under-weighing, and undervaluing its various steel and stainless steel importations last year by nearly 90 percent.

RATS established evidence to support accusations against SSSSC of having imported steel coils, steel sheets, steel bars and stainless steel worth P1.3 billion but which it declared as only worth P165.4 million. RATS found SSSSC to have submitted false and spurious invoices that shaved its tax and duty obligations to the government from P179.4 million to only P25.3 million.

While this case is pending at the DOJ, the Office of the Deputy Executive Secretary for Legal Affairs (ODESLA), under the Office of the President (OP), acted on the company’s complaint and issued the Palace suspension order. The administrative complaint filed against the RATS team came after a graft case was also lodged against them before the Ombudsman last June 29 by the same complainant.

The complaint against the RATS team stemmed from their alleged attempt to enter and search the SSSSC’s rented warehouse in Meycauayan, Bulacan on July 1 and in Dagat-Dagatan, Caloocan City on July 4 using defective mission orders. The RATS team was also accused of impounding the truck and goods owned by SSSSC on July 9 without any warrant of seizure and detention.

The RATS members charged with grave misconduct, among others, under the ODESLA-OP suspension order were BOC Deputy Commissioner Gregorio Chavez, Atty. Christopher Dy Buco, Edgar Quinones, Francisco Fernandez, Alfredo Adao, Jose Elmer Velarde, Thomas Patric Relucio, and Jim Erick Acosta. They went to the Court of Appeals to seek relief from the Palace suspension order.

But even before the suspension order came, Chavez, as RATS head, already went on leave as early as Sept. 30. While Chavez is on leave, Biazon transferred the functions of RATS temporarily to the deputy commissioner for the revenue collection monitoring group, Peter Manzano.

On a positive note, Biazon obviously intends to continue the operations of RATS. In fact, he has already filed two major smuggling cases since he took office last month. If it ain’t broke, don’t fix it, as we say.

But the Palace suspension order was unfortunately giving cross-signals on P-Noy’s anti-smuggling campaign. If doing their job at RATS got them into a rat hole in the “matuwid na daan,” what would now stop smugglers from acting like cats out to scare their wits away?