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18 April 2024, 02:46 AM

BOC Files Five Smuggling Cases in One Day

April 6, 2011

The Run After The Smugglers (RATS) Program of the Bureau of Customs netted one of the country’s major importers of steel and stainless products, three companies engaged in onion smuggling and an importer of general merchandise as the agency continues to wage an unrelenting campaign to make smuggling unprofitable.

Customs Commissioner Angelito Alvarez said smuggling cases were filed today with the Department of Justice against the officers of Sonic Steel Industries Inc. for their unlawful importation and fictitious re-exportation of cold rolled steel coils and prime cold rolled steel coils with a dutiable value of Three Billion Five Hundred Twenty Six Million Six Hundred Eighty Three Thousand Eight Hundred Sixty Two Pesos (P3,526,683,682).

Sued by the BOC were Doris Ong, executive vice-president and Bienvenido Dulce Jr., vice-president for corporate affairs, respectively, of Sonic Steel Industries located at the 8th Floor of Gedisco Tower, Asuncion Street, Binondo, Manila.

According to Alvarez, Sonic had routinely declared their various importations between January and December 2010 as warehousing entries. The Tariff and Customs Code provides that any imported material used in the manufacture of articles in bonded manufacturing warehouses are not subject to duties and taxes on condition that the finished products are re-exported to another country and that materials not used in the manufacture of said articles shall be assessed the corresponding duties and taxes.

There are documented proofs, however, that Sonic made fraudulent claims that a substantial portion of their importations turned out to be rejects and wastages and were therefore not productively used. The falsified claims were filed to justify their insignificant volume of re-exportation vis-à-vis the actual volume of steel products the company brought in over a period of one year.

Alvarez disclosed that the average rejects and wastages declared by Sonic Industries constituted an average of 40 percent of the actual quantity of steel products the company transported to their bonded manufacturing warehouses.

He added that this figure was highly irregular in the light of the fact that the liquidation reports submitted by Sonic Industries revealed that there were no actual wastages in the processing of its imported steel products.

Even more damning was the information gathered by the RATS Program investigators that the alleged buyers/importers of Sonic Industries’ re-exported steel products were apparently not actually involved in the sale or production of steel products. One such importer was Kamala International, an Indian pastry company.

Sonic Industries’ scheme of deception enabled it to divert into the local market a substantial part of its various steel products of high grade and quality without paying the corresponding duties and taxes. The company’s sin of diversion was aggravated by the fact that the taxes it paid for its imported high grade steel products were computed based on the value of scrap metals rather than the value of high grade steel products.

Customs Deputy Commissioner and concurrently executive director of the RATS Program Gregorio Chavez said that Sonic Industries’ technical smuggling strategies enabled it to defraud the government hundreds of millions of pesos in duties and taxes.

For violating the terms of its warehousing privileges, Chavez said Sonic Industries should not only be asked to pay the corresponding taxes on its fraudulent importation. Their entire shipments with a combined dutiable value of P3,526,683,862 should have been forfeited in favor of the government.

Other suspected smugglers charged by the Bureau of Customs were the officers and brokers of the following companies who tried to bring in 14 containers of Onions worth P6 million and which were misdeclared as microphones and accessories:

Harbor Speed International with office address located at Unit 9, 2nd Floor, PYF Building, Apacible Street, Ermita Manila;
Blue Harbor Commercial Inc, with office address located at Unit 5, 2nd Floor, PYF Building, Apacible Street, Ermita, Manila; and,
R.L.N.B. Trading with office address located at 1291 Lardizabal Street, Sampaloc, Manila.

Sued were Anthony Joey S. Tan who was listed as President of both Harbor Speed International and Blue Harbor Commercial Inc. and Roger. M. Permejo, his custom broker. Also included in a separate charge sheet were Ruben S. Banares, general manager of R.L.N.B. Trading and his custom broker, Diosdado G. Bagon.

Alvarez said the 14 containers of onions were seized for being imported without the required Plant Quarantine Clearance and Import Permit from the Bureau of Plant Industry.

The fifth company which was sued today was CountlessTrading which regularly made importations of various products like household appliances and office equipment that were misdeclared as something else in 243 Import Entries from January to June last year.

Although the total value of all 243 import entries could go as high as P300 million, Countless Trading only declared a combined dutiable value of P29,462,564 and paid only nominal duties and taxes.

Investigations conducted by the RATS Team revealed that Countless Trading, owned by a certain Wenefred Soberano Saguid, appeared to exist only on paper and was only being used a front or dummy of unscrupulous importers.

According to Chavez, Countless Trading listed as its office address a dilapidated dwelling place that was also the declared business address of two companies that had previously been accused by the RATS Team of technical smuggling. These companies were Quick Flo Trading and Gold Mind Trading whose proprietors, like Saguid, did not have the financial capability to engage in multi-million importations.

Aside from Saguid, the Rats Team also listed as respondents the following custom brokers whose services were harnessed by Countless Trading: Maximo G. Legarte, Jr.; Michael S. Valenzuela; Joselito I. Azurin;and, Aleli Arellano.

Alvarez said the filing of this charges should convince smugglers and their cohorts in the Bureau of Customs that their happy days are over. “We will run after them and prosecute them to the full extent of the law,” he added.

Alvarez ordered Chavez to look into the involvement of customs personnel in the operation of smuggling syndicates. He said charges should be filed against BoC employees who approved the accreditation of bogus, non-existent companies and facilitated the release of misdeclared and/or undervalued commodities.

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