The Bureau of Customs filed today the 6th technical smuggling case it has built against oil industry players in a span of just 15 months.

Sued by the BOC before the Department of Justice for various fraudulent practices against customs revenue were the following officer and brokers of JETTI PETROLEUM INCORPORATED: JOSELITO TIBAYAN MAGALONA, president; DARWIN S. SUICO, broker and Attorney-in-fact; and, DARIO C. AMOLATA, a broker based in Cagayan de Oro City. Jetti’s business center is located at President Macapagal Avenue, CBP – 1A, Pasay City.

Also listed as John and and Jane Doe/s were customs employees and other individuals who participated, directly or indirectly, in the illegal release of Jetti’s various importations of diesel and unleaded fuels.

According to its website, Jetti is “a 100% Filipino-owned company engaged in the importation, blending, distribution and retailing of petroleum products.” Formed in 1998 – initially to supply fuels to industrial firms and transport terminals- Jetti has since ventured into the fuels retailing business.

Since 2004, Jetti has become a major oil industry player in Mindanao with a network of company-owned and dealer-owned stations built in the cities of Davao, Cagayan de Oro, Iligan, Butuan and other key areas in Bukidnon, Misamis Oriental, Lanao del Norte and Zamboanga del Sur. The company’s crown jewel is its bulk terminal located within the Phividec Industrial Estate in Tagoloan, Misamis Oriental with a total fuel storage capacity of forty-six million liters.

Customs Commissioner Angelito Alvarez disclosed, however, that the BOC’s Run-After-The-Smugglers (RATS) team had found documented proofs that Jetti’s growth and expansion was partly achieved thru the use of several schemes of deception that had deprived the government of much-needed revenues.

Records of the case would show that between June 2010 and June this year, Jetti made several importations of various petroleum products with a combined dutiable value of P4.1 billion.

Broken in 49 import entries which were unloaded at the Sub-Port of Mindanao International Terminal in Tagoloan, Misamis Oriental , 45 of said import entries were found by RATS investigators to have been tainted with the following anomalies:

1. some P1.1 billion worth of imported petroleum products the company brought in between September 28, 2010 and May 16, 2011 cleared customs despite the fact that the covering import entries for the said shipments were filed beyond the required thirty-days period from the date of discharge. Existing regulations require that those shipments involving a total of 15 import entries should have been deemed abandoned in favor of the government;
2. some P2.9 billion worth of imported petroleum products covered by 30 import entry declarations cleared customs despite the failure of the importer to submit the required Load Port Survey (LPS) and/or Discharge Port Survey (DPS). Again, existing regulations require that said shipments should have been considered “high risk and should have remained in customs custody until “accomplishment and submission of the DPS and other applicable control measures; and,
3. Some P11.7 million in duties and taxes were not paid by Jetti for its various importations as it only paid P896.4 million when, in fact, it should have remitted P908.2 million to the BOC.

According to Customs Deputy Commissioner Gregorio Chavez, Jetti’s various sins of circumvention of various customs rules and regulations gave the Bureau of Customs sufficient justification to legally claim restitution in the amount of P4.1 billion which “represents the total value of the fraudulent shipments.”

Alvarez said it was clear that Jetti could not have succeeded in pulling off this caper without the connivance and indispensable cooperation of corrupt customs officials and employees.

As pointed out by the RATS team, the non-compliance of Jetti with the required LPS coupled with the failure of the District Collector of the Sub Port of Mindanao Container Terminal to subject the shipments to comprehensive Cargo Survey and Dischare Port Survey before their release from customs custody “renders the private and public respondents liable for the illegal release of subject shipments and other fraudulent acts and practices under Section 3602 of the Tariff and Customs Code of the Philippines.

Alvarez instructed Chavez to file as soon as possible an amended charge sheet that would include the names of customs employees who aided and abetted the illegal activities of Jetti.

The customs chef also Alvarez instructed the agency’s Post Entry Audit Group (PEAG) to check all previous importations of Jetti to determine if the same modus operandi was used by the company in the past.

It will be recalled that before this Jetti smuggling case, the BOC under Alvarez’s watch had already filed smuggling cases against Pilipinas Shell, Phoenix Petroleum, Cross Country, Oil Link and Filpride.