Why charge Arreza with someone else’s fraud?

Sunday Times EDITORIAL

Why charge Arreza with someone else’s fraud?


The charge against Administrator Armand Arreza of the Subic Bay Metropolitan Authority (SBMA) arose from failure to appreciate the significance of certain documents.

According to the Presidential Anti-Graft Commission, Arreza committed “gross inexcusable negligence” in the performance of his duties by allowing the removal of 16 luxury vehicles from SBMA without the payment of correct amount of taxes and import duties.

But from the very start, Administrator Arreza had classified the vehicles as brand new from their arrival to, and until their removal from, the Freeport zone. In fact, SBMA declared the vehicles, in Import Tally Sheet No. 038335, as luxury vehicles subject to duties equivalent to 150 percent of their income consumption value under the Tariff and Customs Code.

Nevertheless, Hidemitsu Trading Corp., which brought the vehicles to Subic from Korea, was able to register them as used vehicles.

It turned out that the Bureau of Customs in Subic (BOC-Subic) had issued Certificates of Payment and Import Entry and Revenue Declarations indicating that the vehicles were used vehicles.

For its part, the Land Transportation in Subic (LTO-Subic) had allowed the vehicles’ registration by issuing the corresponding OR/CRs (official receipt/certificate of registration) and license plates. By doing so, LTO violated a standard operating procedure, which requires it to seek clearance from the Bureau of Customs main office before issuing an official receipt or certificate of registration.

To register an imported used vehicle, BOC-Subic must seek prior clearance from BOC Main in Manila. BOC-Subic did not. And neither did LTO-Subic bother to check whether BOC-Subic had complied with the law.

Clearly, there was a conspiracy to defraud the government. However, Administrator Arreza had nothing to do with that plot. LTO-Subic brought the vehicles out of the freeport zone without officially informing SBMA, further proof that the administrator was purposely made ignorant of the transaction.

It is standard operating procedure to inform SBMA in such cases so that a gate pass could be issued for the vehicles.

The charge against the administrator is based on the word “USED” stamped, with the SBMA logo, on Invoice and Packing List Nos. H-001 and H-002. By causing the word to be stamped on the documents, according to PAGC, Arreza facilitated the fraudulent transaction.

All documents of such nature, however, are routinely stamped with the word USED to prevent their being used again. For the enlightenment of the antigraft body, the word does not indicate nor does it refer to the nature or character of the goods.

So, who’s after Arreza?