Bureau of Customs files P8.5-billion case vs alleged oil smugglers

MANILA, Philippines - The Bureau of Customs (BOC) filed criminal charges at the Department of Justice (DOJ) yesterday against officers of an oil firm for allegedly defrauding the government some P8.5 billion in unpaid import duties.

Customs Commissioner Angelito Alvarez said they filed a complaint against officers of Cross Country Oil and Petroleum Corp.

The complaint listed as respondents Alleli Arellano and Arturo Zapata, major stockholder and general manager of Cross Country; Samuel Mora, tax representative of the oil firm; Jerome Canada, broker; and several other unidentified persons.

He said the BOC believes that Cross Country is “being used by unscrupulous individuals as front for unlawful importation of crude oil” after the bureau discovered that based on records of Bureau of Internal Revenue, the firm is a “small, undercapitalized company and yet it was able to import multi-billion-peso worth of oil imports since March last year.”

He said the oil firm paid duties and taxes amounting to only over P1.4 billion in the past 18 months and was even able to refund P99.46 million upon approval of some BOC officials.

The BOC chief said the refund was also fraudulent since Cross Country already recovered its duties and taxes when it sold the imported oil to Vietnamese firm Petromex for $13,64,023.5, or some $2 million more than its declared acquisition cost of $11,307,037.80.

It was also found that the oil firm imported a total of 252,304 barrels of crude oil from China Oil in the US and re-exported only 246,479 barrels.

“These violations gave the government legal justification to consider all subject Cross Country shipments as fraudulent and demand from the company payment of the entire amount of petroleum products imported to the tune of P8.5 billion,” the BOC chief stressed.