‘How government loses billions to fraudulent clearing agents’

Importers suggest ways to end fraud
As the nation’s land borders remain closed by the Federal Government to curtail illicit trade, some clearing agents have resorted to taking advantage of the high volume of cargoes passing through the seaports to shortchange government in terms of duty payable.

Essentially, the fraudulent clearing agents, who now have more cargoes to clear for their clients, shortchange the government through underpayment and false declaration of consignments with a view to reducing duty payable.

The Guardian’s investigations revealed that many importers are being found guilty of the sharp practices by their agents, causing them huge losses in investment when their consignments are eventually seized by the Nigeria Customs Service (NCS). It was also revealed that some customs officers are conniving with the clearing agents to manipulate the duty payable on imported items.

Some importers, who spoke to The Guardian on the illegality, urged the customs to impose strict sanctions on the erring agents and officers. A case between Tonason Evergreen Limited (importer) and Arisiki Nigeria Limited (clearing agent) is reflective of the current situation.

Tonason, through its solicitor, had petitioned the Economic and Financial Crimes Commission (EFCC) over an alleged underpayment by its agent (Arisiki) who allegedly paid a duty of N500,000 on a Toyota Highlander 2013 model instead of the original duty estimated at N1,200,000, thereby cheating the government by N700,000.

The Managing Director of Tonason Evergreen Limited, Ikwuka Tochukwu Jude, in an interview with The Guardian, bemoaned the fraudulent act, stating that all efforts to get the agent tracked by the EFCC and customs had yielded no positive results.

In the petition obtained by The Guardian, Tonason stated: “Our client, upon the purchase of a Toyota Highlander 2013 model, engaged the respondent, Mr. Idemili Innocent of Arisiki Nigeria Limited to clear the vehicle by paying the required customs duty. Our client later paid N1.8 million to Innocent as duty fee which he duly acknowledged.

“Our client was traveling to Nnewi in Anambra State when he was accosted by customs officers who confirmed that the original duty payable on the vehicle was N1.2 million, instead of the paltry N500, 000 paid by the agent.

“In that circumstance, our client swiftly put a call across to the respondent (Innocent) who actually admitted not paying full duty on the vehicle, consequent upon which the respondent quickly made a transfer of N70,000 to our client for onward payment to the customs officers and latter got the vehicle released.” Efforts to get the clearing agent for comments were unfruitful, as he ignored calls and messages to his telephone.

In a similar scenario, Masters Energy Commodity Trading Limited (importer) forfeited 30 containers of rice to customs three years ago owing to the sharp practices by its clearing agent. The agent made a false declaration detailing yeast instead of rice.

In a letter to the House of Representatives Committee on Customs Excise and Tariff, a copy of which was obtained by The Guardian, the company alleged that its agent made a false declaration in order to cut tariff for the 30 containers of rice.

The letter by the then Managing Director, Chukwudi Otigba, reads in part: “Sometime in May 2016, we entered into a business transaction with a Thailand company known as Asia Inter Trade Rice Export Co Ltd for the importation of 30 containers of Thai Parboiled Rice to be delivered at the TinCan Island Port, Apapa, Lagos as contained in the bill of laden.

“We contracted Destiny Impex Limited, a clearing company registered and licensed by customs as our agent to clear the 30 containers of rice in accordance with customs tariff and classifications.“All our importing documents such as bill of lading, commercial invoice, packing list, National Agency for Food Drug Administration and Control (NAFDAC) fumigation certificate, and health certificate clearly disclosed the consignment as rice and not yeast as declared by the agent.”


Another importer, Mrs. Grace Ifeayinwa, expressed the fear that her clearing agent might have shortchanged government in the duty payment for her Toyota Highlander imported through the Apapa port. Ifeayinwa, who said she could not trust any agent due to allegations of fraud, revealed that she was trying to verify the original duty payable on the vehicle upon an allegation that the clearing agent paid N700,000 instead of N1.2 million estimated by the customs.

“When I confronted him, he started avoiding me. Then I contacted another agent who also claimed that I have to pay a penalty fee of N400,000 with a processing fee of N120,000. I have made my findings and discovered that they are both fraudulent, but I am confused now because I cannot drive the car.

“The customs should simplify the duty calculations and payment so that the importers would be able to know the exact duty payable and possibly effect payment by themselves. The existing method is encouraging fraud and it’s not good for our economy,” she said. The President of the National Council of Managing Directors of Customs Licensed Agents, (NCMDCLA), Lucky Amiwero, told The Guardian that the association was doing a lot to ensure that the agents comply with the ethical practice in the job.

Amiwero said the importers should report fraudulent agents to the appropriate quarters such as customs management, which is authorized to sanction any erring practitioner.

“Such an agent could be dragged to the court which will declare him as guilty and mete out necessary punishment. If a court has not declared him guilty, it would be difficult for anyone to call him a fraudster. Besides, the NCS also has the authority to sanction any erring agent by way of withdrawing the operating certificate, and the agency has been doing that when it is convinced beyond a reasonable doubt,” he said.

The Public Relations Officer, Customs Tin Can Island Command, Uche Ejesieme, told The Guardian that the agency did not tolerate fraudulent agents.“We ensure strict compliance with duty rules and sanction the erring agents after diligent profiling has proved him to be fraudulent.

“We have sanctions that we apply to those that are circumventing the process. We have blocked a lot of licenses. Once we do system profiling and discover infraction in the documentation or any manner, we have a way of blocking the license. I can assure you that we follow due process before anybody can block the license. We go through all manner of processes before you can ascertain fraudulent agents. If you don’t engage in such checks and balances, they will let the system off. We have many of them that have been blocked,” he said. He alleged that some of the fraudulent agents used other people’s licenses, but at the end of the day, the owner of the license would be the one to suffer.

Ejesieme enjoined vehicle owners who feel defrauded to visit the customs zonal office to regularise their duty, saying the NCS had opened a window for such an opportunity.“The CG has opened a window in all zonal offices of customs. We have a platform there whereby anybody who wants to regulate his duty payment can stroll in and do so without stress,” he said.