Customs chief collude with cheats to steal informant’s financial reward in million

By Nagananda Kodituwakku

(July 08, Colombo, Sri Lanka Guardian) The Customs Department comes under the direct supervision of the President, Mahinda Rajapakse. Yet, it appears that the President is unaware or ignorant of high level of corruption in the Customs Administration under the present Customs Chief, Sarath Jayathilake, since 2002.

What is exposed here is only aspect of embezzlement of government revenue by defrauding of informant’s share of financial rewards.

The process that should follow on penalties, forfeitures and proceeds of all forfeited goods under the Customs Law is clearly defined under the Customs Law. The Law provides that all proceeds should be paid to the hands of the Director General and that one half of these proceeds should be credited to the Customs reward fund under the control of the Director General for distribution among customs officers concerned and informers - Customs Ordinance, Section 153].

Under the approved Customs Reward scheme, an informant who is responsible for a detection of a revenue fraud is entitled to almost 1/3 of the total proceeds. This is always a substantial amount of money in some cases running into several millions.

Unfortunately, deceiving of informants of their legitimate share of reward has become very common practice in the Customs. There are some cases where over tens of millions of rupees of informants rewards have been cheated by dishonest Customs Officers, with the connivance of the Director General of Customs.

The facts given below refer to two such cases where the current Customs Chief, Sarath Jayathilake and another senior Director of Customs, D Dissanayake, now a Secretary to a Ministry, are responsible for defrauding several million rupees of share of reward due to an informant.

In these two cases [CRTF/175/2001 & 195/2001], the Director of Customs D Dissanayake received information from a motor spare parts importer, whose name cannot be disclosed for legal reasons, about a revenue fraud being committed by another established motor spare part importer. Tasha Pvt Ltd.

The Director, D Dissanayake who received the information passed it on to the head of the Customs Revenue Task Force [RTF] for necessary action. Then I headed the RTF and at the outset the informant was reluctant to come forward but his information resulted a successful detection of a major revenue fraud where the informants legitimate share of reward was several million rupees.

After the case was successful, the Director of Customs, D Dissanayake made a claim for the informant’s share of the reward. His first attempt was made in 2001 was unsuccessful because of the objections raised for making a fraudulent claim. The then DGC Luckshman Perera upheld the objections and plainly refused his claim on the basis that Director Dissanayke cannot abuse his office to make a claim for a reward on a information received in his official capacity as a Director of Customs.

Yet, he refused to give up his desire to make a claim for a reward and when Sarath Jayathilake was appointed as DGC he renewed his claim. The DGC, Sarath Jayathilake sought my recommendations, because Director Dissanayake claimed he passed the information he received to me. However, it was a fact that he clearly informed me that the informant do not wish to make a claim for a reward in the event the information was successful.

On this matter, I once again raised my objections very clear with the background information of the case. The DGC, Sarath Jayathilake was informed that Director Dissanayake’s claim for informant’s share of reward is manifestly unfounded and his conduct is clearly unbecoming of a senior public officer and he should be charged for misconduct.

DGC, Sarath Jayathilake, clearly knew, that Director Dissanayake had made a similar claim earlier, which was refused by the then DGC Luchshman Perera. Yet, now I understand that DGC, Sarath Jayathilake, has colluded with Director Dissanayake and after sham inquiry paid him the information share of the case running into several million rupees. This is clearly amount to blatant violation of all norms and practice guidelines that should have been adhere to similar cases.

This is just only a tip of the iceberg and there are many more such cases where hundreds of millions of legitimate share of informants rewards have been misappropriated by dishonest officials, some of who have paid a heavy price for their dishonestly.

[The writer former head of the Customs Revenue Task Force ]

-Sri Lanka Guardian