Broker broken over Customs policy

Forced to pay $832 to the Customs Department for a bad cheque issued by one of his clients, veteran broker Alvin Browne believes that Customs should put policies in place regarding the collection of monies from customers and not hold brokers liable for their clients’ financial indiscretions. (Picture by Maria Bradshaw.)

By Maria Bradshaw | Fri, August 24, 2012 - 11:35 AM

Veteran customs broker Alvin Browne is calling on the Ministry of Commerce and the Ministry of Finance to urgently plug the financial loopholes at the Customs Department because they are impacting negatively on brokers.

For the past week his company was unable to conduct any business with the Customs Department because one of his clients issued a bad cheque to Customs for imported goods.

On Wednesday he was forced to pay the $832 – the amount written on the cheque – to Customs in order to continue processing work with that department.

An upset Browne pointed out that this system was affecting brokers across the board.

He contended that they should not be held liable for any financial transactions between the Customs Department and any client they process because the transaction takes place between Customs and the particular customer.

“All we do is process the paperwork. When the client leaves our offices, that is the end of our duties. We cannot set the regulations for Customs regarding if they should take cash or cheques and we don’t deal with bank accounts or what is in the shipment,” he said.

Explaining the dilemma, Browne, who has been a broker for over 25 years, said that back in March his company processed paperwork for a walk-in client who owns a boutique in Bridgetown.

He said he found out only last week that the client had issued a bounced cheque when his employees informed him that they could not access his online account with Customs.

“I called Customs to find out what was going on and I was informed that I had issued a bounced cheque so my declarant number had been suspended.”

Shocked and confused, Browne said he went to the department to investigate what was going on and was shown a returned cheque in the client’s business name.

“I told them that it had nothing to do with me – that I was not the person who wrote the cheque and that I did not clear or pay any duties on behalf of anyone.”

However, he said after meeting with three senior officials at Customs he was informed that because his name appeared on the entry, he would have to pay the money or not be able to transact any more business with the department.

Browne, who does brokerage for several restaurants and major businesses, lamented that all of his transactions remained stuck in the system for a week, causing him to lose thousands of dollars as he tried to get the matter resolved.

“I even had an urgent transaction for medication for a disabled child who is sick and only has one kidney and I sent the child’s father to ask them to release the medication but they refused, so I had to get another broker to process it.”

He said the very embarrassing situation hampered his business to the extent that he was forced to pay the money – otherwise he would have had to send home staff.

He also pointed out that he was made to feel as if he was the guilty party.

“I think it was wrong for Customs to suspend my declarant number without even contacting me to inform me that there was a problem in the first place. They just shut me out from the system without warning. I pay my VAT. I pay my rent to BIDC [Barbados Investment and Development Corporation] every month. I have never been in trouble with the law, so I cannot understand why I was treated in this way.”

Browne further noted that as far as he was aware, Customs should not be taking cheques from such walk-in clients who were classified as “high risk”. And he said what was even more disturbing was that the name Customs had on file for the client and the name on the cheque did not match, and that should have raised a red flag.

“The cashiers at Customs took the cheque . . . and then gave the client a receipt with my name written on it – which was wrong. Suppose it was $80 000? I would have [had] to close down my business,” he said.

He said when he called the client and told her about the problem, she readily admitted she had issued the cheque, adding she could not afford to compensate him at this time because she had no money.

The broker said such a situation could greatly affect customs brokers and many of them were now considering getting liability insurance if Government was going to hold them liable for the wrongdoings of their clients and the practices of the Customs Department.

“If we get liability insurance that means that we would have to increase our fees considerably,” he said.

“We believe that as one of Government’s leading revenue intake departments, Customs need to improve how they conduct business. The department does not have an Equicheck system; it does not have counterfeit detector machines and it does not have any financial policies in place when it comes to dealing with customers. It means that everything will fall back on us. So where will the liability stop?

“We have processed shipments which, when checked by Customs, contained drugs and guns and other illegal items. Are we going to be held liable for those too?”

Browne said brokers would try to discuss these matters with the relevant ministry as a matter of urgency, but if they are not absolved from this responsibility they would have to take the matter to court to have it resolved.

Efforts to reach Acting Comptroller of Customs Frank Holder for a comment were unsuccessful.