Remittances to banks: senate committee recovers N140 billion

The Senate Joint Committee On Customs, Excise and Tariff and Marine Transport says total financial recoveries from companies being investigated by the committee amounted to N140 billion. Senator Hope Uzodimma The joint committee was set up by the Senate to carry out a holistic investigation into the activities of the Nigerian Customs Services (NCS) with a view to identifying leakages and irregularities in the system and come up with recommendations that will reinvigorate the revenue drive of the NCS. Presenting its Interim Report on the floor of the Senate, the Chairman of the Committee, Senator Hope Uzodinma, disclosed that as a result of the exercise, some collection banks have made remittances to the Central Bank of Nigeria (CBN) to the tune of N128  billion  while, from the selected 60 companies under investigation, over N12  billion payments has  been made to  government. “As a result of this exercise, some collection banks have made additional remittances to the Central Bank of Nigeria to the tune of N128 billion and evidence of payment and receipt  has been received by the committee” Uzodinma  said, adding: “from the selected 60 companies, over N12 Billion payments have been made to the government voluntarily by the companies based on their own internal self-audit after receiving documented evidence of their culpability from our committee”. He  however noted that despite all the payments so far made, none of the approved collection banks or the selected companies have fully cleared the established liabilities against them. The chairman  stated that in the course of its investigation, the panel  identified 32 leakage channels as the major sources of revenue loss in the import-export value chain. According to him, the leakage channels include undervaluation, wrong tariff classification, abuse of waivers and concessions, abuse of diplomatic cargo and personal effects privilege to clear consignments to submission of forged documents for pre-Arrival Assessment Report (PAARS) and Single Goods Declarations (SDGS) processing, Pre-Arrival Assessment Report (PAAR) used for more than one Single Goods Declaration, non-utilization of Pre-Arrival Assessment Report (PAAR) after Single Goods Declaration (SGD) cancellation and mismatch and discrepancies in consignees, goods description and tariff classification. Other sources of leakage identified by the committee include falsification of import documentation such as proforma invoice, final invoice, bills of lading, NAFDAC and SONCAP. There are also issues like non-imputation of complete VIN (Vehicle Identification Number) in inspection acts and bills of lading in order to undervalue vehicles, clearance of new vehicles without form M or Pre-Arrival Assessment Report (PAAR) processing in clear violation of Destination Inspection, abuse of temporary importation by conversion to home use without payment of import duties, falsification of factory production registers, inaccurate Unit Cost Analysis (UCA) and returns leading to significantly low excise duty collected as compared to actual large scale volumes of excisable commodities locally manufactured. Other sources of revenue losses include abuse of Fast Track Blue lane, illegal creation, amendment, and cancellation of Single Goods Declaration (SGDs), Pre-Arrival Assessment Reports (PAARs) and bills of lading, and importation under pretext of Completely Knocked Down (CKD) privilege reserved for bona fide manufactures leading to reduction in import duties payable among others. Uzodinma  noted that these infractions disproportionately distorted the economic profile of the country and placed extensive pressures on the nation’s scarce foreign exchange. “It also negates all Central Bank of Nigeria initiated foreign exchange management plans. This is because a distorted forex requirement does not essentially reflect the actual forex need of individuals and businesses in the country. This situation benefits only the purveyors of capital flight from the country and adds absolutely no value to the nation”, the committee chair said. Meanwhile, the Senate has commended the efforts of the committee to recover such huge sums into the coffers of government. Speaking on behalf of the Senate, Deputy Senate President, Ike Ekeremadu, said the committee’s achievement should be emulated by other committees. In  separate reactions, some  civil society organizations said the committee had passed integrity test. The Executive Director of the Centre for Advocacy and Leadership Development (CALD), Joe Mesele, said the recoveries through the Senate Committee investigations have brightened the hope of Nigerians for effective and honest oversight activities in the National Assembly. “Some of us within the civil society community did not give the committee any chance of performance but we have obviously been proved wrong with these huge recoveries”, he stated. “What is left now is for Nigerians, especially players in the corporate world, to rally round by cooperating with the committee to conclude its assignment with more successes”. The committee had requested for memoranda through newspaper publications and also invited key stakeholders to a One-Day Public Hearing held on Thursday, July 20, 2017. Armed with concise data from its data handling process, the committee proceeded to invite the concerned commercial banks and handed them relevant data in soft and hard copies for their responses. It sought  extension of its mandate to be able to fully complete its job and got  eight more weeks.