by 'Fisayo Soyombo
December 31
https://www.thecable.ng/undercover-investigation-nigerias-customs-of-corruption-bribery-and-forgery


INTRODUCTION TO CORRUPTION

Samson and I shared experiences. First, I told him my plans for my import business, and when I was done, I asked him: “What is the toughest job you have handled in the last six months?”

“Ah!” he exclaimed instantly. “That was in July 2015, when my uncle tried to bring in a block-making machine.”

For the next 30 minutes or thereabouts, he would talk about a series of artificial bottlenecks devised by Customs officials to exploit the average importer.

The landing cost of the machine, excluding the agency and clearing fees, was $25,000. Now, the duty on an industrial-use machine that cannot be fabricated in-country, such as this, is 5 per cent of the landing cost. But once the machine arrived, Customs officials claimed it was undervalued by the importer and it should have cost no less than $54,000. By doubling the landing cost, they were compelling the importer to either pay twice the original fee to the government or pay them a smaller bribe.

“They claimed that someone had bought the same machine for $54,000, and then demanded a bribe from us if we didn’t want to make a fresh payment,” he says. “But that was a big, fat lie, because the landing cost of the machine is exactly $25,000.”

SHIPPING-LINE CORRUPTION

Most shipping lines are owned by foreigners. And since Nigeria is an import-dependent country, importers are left at the mercy of foreign-owned shipping lines. This is what they do:

“The moment the ship bearing your goods berths, the shipping line immediately sends you a mail that you must clear your goods within three days. They expect you to clear within three days; meanwhile, it will typically take four to seven days for your container to be moved from the ship to the block stacking, where all containers are first kept,” Samson explains slowly, pinstakingly.

“On a ship, you may have 1,000 containers on it. So, imagine if your container was among the last 50, it won’t arrive at the block stacking earlier than the fourth day. Yet, your container is already on the ship when your three-day notice starts reading.”

The consequence is that as early as the fourth day, importers are already being charged for demurrage. On a 20-feet container, the importer pays N7,000 daily from the fourth day, while it’s N11,000 daily for a 40-feet container. Samson considers this practice a “very devilish ploy to exploit Nigerians”.

CORRUPTION BY INSPECTION
As Samson explained, the NCS classifies incoming goods into four: green, blue, yellow and red. Green means the goods are well-trusted and therefore require no examination. But goods imported from suspicious countries, such as Indonesia where drug peddling is high, are classified as ‘red’ and requiring physical examination. So the importer not only pays Customs for physically examining the goods, but also the shipping agency for demurrage while awaiting the date of examination.

“Customs may tell you that your container is on red alert and that your physical examination will not take place until another three days, because there are thousands of containers to be examined.

“You will need to pay Customs to come and open your container and examine; they have made this corruption legal. In my own case, the total payment was N60,000, while we paid N24,000 for the physical examination itself. Meanwhile, shipping lines do not charge you day by day; they charge you upfront, minimum of four days.

“Now, when it’s time for your container to be opened, the Customs officers will tell you to open, even though they know that you actually cannot open the container yourself. Therefore, you are forced to engage the services of their labourers. But before the labourers lift a finger, they demand money – and you have to pay them. Meanwhile, this was one of the things you already paid Customs for.”

EVEN NAFDAC, SSS, NDLEA ARE BRIBED FOR ‘LOOKING’
So, what happens when the container has been opened? Representatives of all agencies go in to check, and each of them collects N1,000 “just for looking”. During the inspection of the block-making machine, “representatives of seven agencies” collected the money, according to Samson.

These are Nigeria Police Force (NPF), Nigeria Customs Service (NCS), State Security Service (SSS), National Agency for Food Drugs Administration and Control (NAFDAC), Nigerian Ports Authority (NPA),National Drug Law Enforcement Agency (NDLEA), and Nigeria Agricultural Quarantine Services (NAQS).

Of course any act of corruption should worry any patriotic Nigerian. But in this case, it is not just the N1,000 but the sheer scale of the sum total of the individual collections. On this day alone, Samson witnessed the inspection of “more than 1,000” containers. By that calculation, each agency went home with an illegal collection of at least N1million.

And it’s hard for importers not to pay the bribe, because failing to pay these officers means that they won’t inspect on the day, which in turn means the importer’s container is moved to another location. When this happens, the importer not only pays a fresh inspection fee, he also has incurred more demurrage charge.

“So, these things are interwoven,” Samson says. “You pay N1,000 bribe to free yourself from maybe N20,000 or N30,000 charge. And if you don’t scale a process, you can’t proceed to the next. You see how complicated it is?”

Aside bribery, there is the danger of a porous system that allows for the illegal importation of arms or other contraband, because once these field officers are paid, they do not inspect; “they just look and tick the papers”.

After this “looking”, photocopies of the ticked Performa Invoice (PI) and the Bill of Lading are taken to the offices of the superiors of these officers, one by one. And when they have signed – most of them also demanding bribe – the documents are taken to the Releasing Officer.

THE RELEASING OFFICER IS LORD

The releasing officer wields enormous powers, especially because he is last in the line. A “no” from him literally nullifies all payments and efforts since arrival of a container. So he makes his money by claiming that the imported goods have been undervalued, and subsequently quoting a fresh, usually-unreasonable figure. He then tells the importer to pay a percentage of the new fee to the government or pay him a lesser fraction, if the goods must be released. Like all other importers, Samson’s uncle fell victim too.

“We bought this machine for $25,000. But Customs already valued it at $54,000, meaning we paid a duty of $2,700 instead of $1,250,” Samson recalls, his face decorated with anger.

“But, all of a sudden, the releasing officer said even $54,000 was an underestimation; he claimed the machine was worth $80,000, and said we had short-changed the Nigerian government.”

Despite all of Samson’s protestations, the releasing officer insisted that 5% of $80,000 had to be paid to the government. And although this calculation itself amounted to $4,000 (N800,000 at the rate of $1 to N200), the officer claimed that by his own calculation, the importer had to pay a whopping N1.5 million to the government. It soon emerged that the Releasing Officer was far from interested in generating revenue for the government.

“He told us we had paid N600,000 out of N1.5million, leaving a deficit of N900,000. He promised to let us go if we paid him one-third of that amount, that is N300,000.

“The tricky part is that if we didn’t pay the N300,000 by 4pm that day, we would not only pay N900,000 the following day, we would miss the following day’s deadline for moving our container, which would mean paying extra terminal and shipping charges. And don’t forget, these charges would not be extended by one day; the extension was for a minimum of four days, and these two costs would be close to N100,000.”

Eventually, the Releasing Officer let them go after collecting – wait for it – a paltry N50,000.

AT THE PORTS, ‘GATE MEN’ ARE POWERFUL PEOPLE
In most establishments, gate keepers are some of the least respected staff, as they are not considered anywhere close to the power brokers. Well, at the Apapa ports, gate keepers are so powerful. And this is why.

The various acts of corruption by officials of Customs and other agencies are all devised to capitalise on the importer’s determination – at times, desperation – to adhere with strict deadlines for movement of goods out of the ports, to avoid paying demurrage. As a result, the releasing officer usually gives his final word a few hours before that deadline.

Now, due to the congestion outside the port gate, it typically takes a truck 12 hours to make its way into the port premises. So, if the men at the gate delay the entry of a truck after the agent has completed the clearing, this deadline can still be missed, which then means all previously-paid bribes have virtually come to nought. Dicey, isn’t it?

Samson says he had to “tip the gate man for him to quickly sign my papers, because if he didn’t on time, I would have missed that deadline”.

That is just one aspect of corruption at the gate. The second happens in front of the gate, where trucks are lined up and each one is in a hurry to be the first to enter. To manage this commotion, Customs engaged a team of soldiers, police, civil defence and navy to organise the truck drivers to maintain a single line.

“When I handed our papers to a truck driver, he told me, ‘Look, this paper expires tomorrow and you’re bringing it at 6pm today. If you really want to move your container, you have to pay us N20,000 for facilitation’. That fee is outside the N70,000 we were to pay to him for moving the container from Apapa to Lagos Island.

“He said to me, ‘We will need to give all these officers something, so that they would pass our own truck and pilot us straight to the gate’. My paper was to expire by 12 noon the following day, so it was either I paid this N20,000 bribe, or I would have to pay fresh terminal and shipping charges that would be roughly N80,000.”

As usual, Samson paid the bribe, and he watched as a soldier collected N5,000 and hopped into the truck to sit by the driver, directing him to head towards the gate. When the driver reached the points that were policed by the navy, police and civil defence officers, he paid them N,5000 each. In a matter of minutes, the N20,000 had vanished and the truck was right inside the port. Yet, this same truck would have been denied entry, despite holding papers clearly stating that the container had to be moved before noon the following day.

WHO SAYS THE AGENTS ARE CLEAN, ANYWAY?
It was very easy for all the agents to expose acts of corruption by Customs and other agencies. After noticing that they evaded their own financial dealings with importers, I contacted Ayodele Adebambo, a businessman who had little problem fixing an appointment for his Ikorodu office on Monday, December 21, to discuss his encounters with clearing agents and how they were corruptly enriching themselves at the expense of importers.

One of such shady moves is in collusion with a banker, who provides the agent with fake documentation with which to swindle the importer.

“First time I experienced it, I was inside a bank and an agent brought a bank draft to the counter. I noticed that the guy was fidgety, and that the banker returned a draft that was separate from the one he collected. So I asked questions,” Adebambo says.

This is how it happens. Importers usually pay rent to use containers; it is N250,000 for 20-feet containers and N400,00 for 40-feet. If the container is returned to the port in good condition, after movement of goods from the port to destination, the rent is refunded to the importer through his agent. This return is never made in cash, but in bank draft. However, for every extra day the container stays on the site, the importer suffers daily deduction from that rent, because the expectation is that the container should be returned within 24 hours.
“The agents know how to bargain for waivers even when the importer is due for deduction. So when a clearing agent collects, say, a bank draft of N400,000 in the name of the importer, he takes it to an agent who specialises in bank-draft fraud,” he explains further.

“These ‘agents of draft’, as they are called, are connected with bankers. The draft agent enters the bank and locates his insider. They move the money to a particular account, and when the money reflects in that account, they do a fresh draft from the receiver’s account. By that time, the banker would have deducted a percentage of the N400,000, say N60,000. So the banker and draft agent both share the N60,000.

“The clearing agent may then say he actually wants to present N200,000 to the importer, so another draft will be generated, and the clearing agent will pocket N140,000. It is this bank draft of N200,00 that they will now re-present to the importer.

“Let’s assume the banker changes 10 drafts in a day, and he makes N15,000, then he goes home with N150,000. That is just for one day. And do not forget, the business of importation is heavy in Nigeria, so these shady deals are always available every day. If he does that five times a week, he will be making approximately N3m a month, which is multiple times his salary.”

NOT JUST FRAUD, BUT FORGERY AS WELL
After successfully convincing Samson that I would make him my agent from January when I intended to begin importation, he gladly sent me a Performa Invoice (PI), which is the first document an agent works with before the onset of shipping. With this PI, I visited Nnewi Building on Wednesday December 23. If these agents went as far as forging bank drafts, some other forms of forgery must be going on, surely.

When I strolled into the building at a few minutes before 8am, I was one of the earliest arrivals. Three shops were open at the time: one manned by a fair, young lady donning a clingy top and a salaciously-short skirt; the second by another fair occupant, this time a man, elderly, slow-speaking and modest in appearance; and one more by a young man whom I didn’t see but whose voice I only heard as he conversed loudly with a “client” of his on the phone.

I decided my destination in split seconds. I didn’t need the distraction of a showy lady, and I gave a thumbs down to the young man’s ebullience. I was interested in the experience of “Andy”, as he would later introduce himself – or “Pa Andy” – as I continued drumming to myself. “What do you want, my son?” the old man asks.

“Insurance for this goods, sir. Insurance plus bill of lading.”

“Make I see your PI,” he asks, before quickly adding, “Which bank you wan use?”

I still hadn’t answered when he continued: “Me I no fit do ‘bill lading’ o; person wey dey do am never come. But this insurance go cost you N300.”

I waited outside while Pa Andy recoiled in. He reappeared after some 10 minutes and handed a paper to me – a duly stamped and signed ‘original’ marine certificate from Alliance and General Insurance Company Limited, which indicated that I had paid N18,575.70! Meanwhile, I had only paidPa Andy 1.61% of that figure!

A DARING TRIP TO THE STRONGHOLD OF CORRUPTION
In one final push for a live experience of all I had heard from clearing agents, importers and security agents over the last eight days, I arrived Apapa port at about 9am on Thursday December 24, with the intention forcing my way to the inspection ground. It was the last gentleman’s agreement I had with Samson before I could officially designate him my clearing agent from January 2016: I needed to experience the payment of bribes to officials at the inspection centre so that when he finally became my agent and he had to demand such payments from me, I wouldn’t hastily conclude that he was trying to con me.

Therefore, I arrived the port gate dressed like a clearing agent, spotting a blue Ralph Lauren shirt and a pair of blue jeans on a pair of black snickers. How wrong was I think to think I was going to stroll in as I did exactly one week before!

“Yes, where is your port pass?” one of the three uniformed men manning the gate queries me. Once the first soldier launched that attack, the NPA and police officers with him followed suit.

“Oga, tok nah. I say wia ur port pass?” one of the other two screams at me.

“Errrmm… I don’t have,” I stammer.

“You go settle us be that,” the soldier retorts. “Oya, oya; no waste our time.”

I hand him a N500 note, and he passes me in.

Up next was the cabin side occupied by mufti-wearing Customs officers. A week ago, I sat among them for over an hour, and none of them dared question me. This time, one barked out the moment he sighted me: “Come here! Who are you and who authorised you to enter?”

Samson had already mentioned me to his boss as a potential customer who needed to go in with him, so at the mention of Samson’s boss – a popular figure among the officers – I was cleared to enter.

For the next two hours, I would pass time beside one of the food vendors close to ‘Customs Office’, in anticipation of the examination of a container Samson was clearing. Samson had told me it would hold at 11am, but 11am became 12noon, noon became 1pm, and 1pm extended to 2pm. So long the inspection ground was the place where the actual sharing of money to seven recognised government agencies took place, no wait could ever be too long. I was beginning to wonder if I had been scammed when Samson appeared out of the blue to fetch me, and we both sprang into a waiting bus that conveyed a total of 18 clearing agents to the inspection ground. As I soon found out, the bus was one of a few that worked in shuttles, fetching agents from the Customs Office to and from the inspection ground.

Security here was tighter than I anticipated. A harmless-looking civil defence officer manned the gate, fussily checking the agents’ ID cards and port passes to be sure that only authorised people entered. After renting a reflective vest (worn by all agents) for N100 from a nearby seller, I advanced towards the gate with container papers handed over to me by Samson, but I was turned back. Two bellicose men who carried themselves like the officer’s superiors stepped in to find out what the matter was; and when they found out I had no port pass, they drove me away.

“No ID card/port pass, no entry,” one shouted. “You have no business here; just go.”

I pulled the N500 trick that worked with the soldier, but it failed. When I stepped it up to N5,000 and they still didn’t budge, I knew I had reached my wits end. But I reminded myself that my job was still unfinished: If I can’t enter, I must find out the real reason why I can’t! Is it to protect the goods or to protect their pockets?

I pulled out my phone, plugged my headset and began listening to and loudly humming the lyrics of Carlos Santana/Music’s Nothing At All. I turned off the volume but continued humming and whistling to feign the impression that I was dead to the noise around me. It worked!

“Who knows who he is?” one of the two menacing men says. “We have to be careful. See what happened last week. Who would have believed that Wale would be the one to go about running his mouth about our ‘runs’?”

DAMAGE BEYOND BELIEF

By its own admission, NCS has two major functions: the “core” and “others”. The core functions, which are just two, are “collection of revenue i.e. import and excise duties and accounting for same”, and “prevention and suppression of smuggling”.

But has the service truly been collecting “revenues”? Certainly not. It has been more of “bribe” collection than “revenue” collection. “Accounting” for revenue collection is also out of question. Although, over the last few years, the service has regularly declared a figure in the realm of N1trillion as annual revenue generation, there are no documents in public domain by which the service can be held to account. That may soon change, though, since President Muhammadu Buhari recently ordered the probe of all revenue-generating agencies, including Customs, from 2012 to 2015.

Has Customs been preventing and suppressing smuggling? Surely not to the extent that it can, because when inspection officers only “look” at a container, collect N1,000 and move on to the next container, there can’t be watertight blockade against the smuggling of illicit goods or even arms into the country.

Shortly after leaving office as comptroller-general of Customs in August 2015, Dikko Abdullahi boasted boasted that the service, which was generating a monthly revenue of N29billion before his assumption of office, was realising “between N90billion and N100billion on a monthly basis” by his departure. Hats off to Abdullahi for the upgrade, but far from impressive – because, at the very least, Abdullahi’s Customs should have been declaring nothing short of N500billion to N1trillion monthly, seeing how Customs officers deprived the government of N1million in exchange for a bribe of N300,000, or N900,000 for a measly N50,000 bribe.

As revealed by the experiences narrated in this report, the business of importation and clearing, as it currently runs, is a huge turnoff for any serious or incorruptible businessman.

RIDDING CUSTOMS OF CORRUPTION
There is little doubt that Hameed Ali, a retired colonel, is desperate to clean up the mess that is the NCS. So “incorruptible” is Ali that Buhari nearly named him chairman of Nigeria’s anti-corruption agency, the Economic and Financial Crimes Commission (EFCC) – until he had a last-minute about-face – instead appointing the Kaduna state former military governor as CG of Customs.

And since assuming office, Ali has talked tough. In one of his first public appearances, he said that corrupt Customs officer “will not go scot-free”. A month later, he vowed to double the minimum punishment for corruption in the agency, saying: “The minimum jail term for corrupt officers is five years, but I will make sure that any officer found to be corrupt gets the maximum jail term of 10 years.”

It must be said that it hasn’t been all talk. Within two months of his reign, all five deputy comptrollers-general of the service tendered their resignation, to herald his restructuring plan. This was soon followed by the “immediate retirement” of 40 senior officers. With the same period, he cancelled the practice of permanent posting of officers to unit commands and departments, saying anyone who had spent up to three years in a unit should expect posting. Then he followed this up by promising to meet the president to discuss improved remuneration for Customs personnel. Clearly, Ali has the will that was lacking (or maybe not evident) in previous regimes.

But my experience with this undercover investigation has shown that Ali’s strategies have so far omitted the factor most crucial to sanitising the agency: elimination of human contact with importers/agents. And the best way to achieve this was long prescribed by the president under whose watch corruption perhaps flourished most in the country: Goodluck Jonathan.

Speaking in March at a campaign rally in Enugu ahead of a presidential election he would go on to lose, Jonathan had censured his opponent, Buhari, and his party, the All Progressives Congress (APC), for constantly haranguing and pillorying him for lacking the will to fight corruption. He said: “You don’t fight corruption with individuals or will, you fight it with institutions, with technology.”

Ali must never mind that Jonathan didn’t practise what he preached; he must retrieve the message and forget the messenger. Without a technological revolution, Ali’s will to rid Customs of corruption will be futile. The releasing officer who demanded for N300,000 wouldn’t do it if the applicant submitted his endorsed documents online, and the approval process was entirely electronic, with superior officers having online access to his dealings. The representatives of seven agencies who collected N1,000,000 per ‘looked’ contained would have been handicapped if all containers were screened by scanning devices rather than by physical examination. Of course, NCS has a website with which it interfaces with importers; but bar the filling of the ‘Form M’ and a few other pre-shipping procedures, the bulk of the work, particularly after arrival of goods, takes place physically. And this wholesale technological migration does not have to be accompanied by loss of jobs, as people only need to be made to do online, the same tasks they did offline.

In the end, fighting corruption in the NCS is not exactly about sacking the you-will-survive-I-will-survive officer or the N500-bribe-taking soldier, or the your-machine-is-undervalued bribe-seeking releasing officer. It is purely about enthroning a custom of institutional probity, about instituting a corruption-intolerant SYSTEM rather sticking with the medicine-after-death approach of sacking corrupt officers.

hmmmmm



new update
http://opeyemiie..co.id/2015/12/read-president-buhari-new-year-message.html?m=0#more

na wa o
please share this on fb, twitter, IG and every other social media in 9ja. the crimes of these people need to be brought to the light.

JeeeZUS!!!

It seems the president needs to-do a lot more to be able to meet the 1.4trillion internally generated revenue target to be made from customs and the NPA.

I've always known that institution to be corrupt but this eye-opener by the investigative reporter has sent some real chills to my spine!

A great many employees under these two institutions deserve to lose their jobs for real and wholesale changes need to be done for sanity to reign @ the ports.

Lovely exposé. The press in 2016 must focus on investigative journalism so that the necessary authorities can act decisively. I must commend the journalist that risked his life to get this story.

It will take a while for the NCS to be fully reorganised to meet the revenue needs of the FG.

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