CUSTOMS_U_S_A

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special agent checks for
vessels during the events
celebrating the Statue of Liberty's centen-

Inside cover

On behalf of U.S. Customs, the Commis-
sioner accepted this P-3 aircraft for the
Tucson Air Operations Branch.

Contents

is published by the The Secretary of the Treasury has

Information Services Division, U.S. determined that publication of this

Customs Service, Room 6311, Wash- periodical is necessary in the transac-

ington, D.C. 20229. tion of the public business required by

(202) 566-3962 Saw of the U.S. Customs Service.

2

Highlights

An Ever-Growing Mission
Customs Organization

4

Air Passenger Processing
Air Carrier Initiative
Drug Interdiction
Commercial Initiatives
Airport Security Program
7

Strategic Investigations Operation
Exodus

Fraud Investigations
Special Investigations
Smuggling Investigations
OCDE Task Forces
Child Pornography
Operation Buckstop
Marine Program
Aviation Program

13

Intelligence

Research and Development
Communications

18

Automated Commercial System
Commercial Compliance
Requirements of Other Agencies
Regulatory Audit
Technical Services
Classification and Value
Carriers, Drawback, Bonds
Entry Procedures and Penalties
Regulations and Disclosure Law

28

Drug Interdiction Initiatives
Cooperation with Colombia
Narcotics Control Training
Executive Observation Programs
Anti-Terrorism Assistance

Technical and Administrative
Assistance

Bilateral Agreements
Customs Cooperation Council
Foreign Missions
Saudi Arabian Programs

32

Security
Internal Audit
Management Inspection

33

Centralization
Administrative Systems
Logistics

Automated Systems
Customs User Fees
Personnel
Equal Opportunity Program

36
information

Editor: John Costello
Managing Editor: Patricia Coss

Photo Credits
Headquarters:

Northeast:

New York:
North Central:
Southeast:

South Centra!:

Southwest:

Pacific:

Karen Durkalski,
Bill Mason
Roberto G. Medina
Dennis Murphy
John Cons/dine
Richard McLean
Herb Yellin
Jim Nathan
Raymond Smith
Walter Wilkowski
Liz Orgeron
Al Wenz/aff
Jim Sco/man

Highlights

U.S. Commissioner of Customs

As I reflect upon Customs' perform-
ance during the past year, I conclude that
there has never been a better time for
Customs or a better time to be in
Customs. This optimistic assessment is
based in part upon Customs' role in con-
tributing to the solution to major prob-
lems and challenges facing this nation.

These problems and challenges are
primarily related to the U.S. economy
and the trade deficit, concern regarding
narcotics and drug abuse and the prob-
lems of illegal immigration. Customs has
been in the forefront in addressing these
matters.

As we implement trade restrictions
and make admissibiiity decisions, deter-
mine classification and value, collect ap-
propriate duty, provide accurate trade
statistics to the Department of Com-
merce, interdict narcotics at and between
the ports of entry, develop new and in-
novative approaches to prevent narcotics
smuggling by aircraft, and as we partici-
pate with the Immigration and Naturaliza-
tion Service (INS) in detecting illegal im-
migration we are directly contributing
to important national priorities.

And in addition, during the past year,
we have witnessed the "coming to frui-
tion" of a number of extremely important
long-term initiatives.

Many of the Automated Commercial
System (ACS) capabilities have been im-
plemented. By the end of this fiscal year,
nearly one half of all entries will be pro-
cessed through the Automated Broker
Interface with significant benefits to
Customs, the broker and the importing
community in terms of timeliness of mer-
chandise processing and reduction in
paper.

We have implemented new ap-
proaches for processing containerized
cargo including centralized devanning.

The Operational Analysis Sections are
beginning to generate excellent informa-
tion for ACS which is leading to im-
proved selectivity and enforcement in all
areas of merchandise processing.

We have begun to receive the much-
needed assets to produce a truly effec-
tive air interdiction program.

In the coming months we will be ac-
quiring additional "aerostat" radars, and
will be obtaining E2C surveillance air-
craft. We have already received the
Customs High Endurance Tracker (CHET)
aircraft which significantly improves our
ability to track and apprehend air
smugglers.

We are proceeding with the modifica-
tion of the P3 air surveillance aircraft and,
we are implementing extensive recruit-
ment efforts to obtain highly qualified
pilots and technicians to support this air

interdiction capability. These additional
air program resources will lay the basis
for improved air interdiction along our
southern borders.

These are examples of just a few of
the areas where we are beginning to
achieve significant success. And there
are others.

We will be implementing entry simpli-
fication and import specialist super
teams. We are working with the import-
ing and broker industry on improved
cooperative efforts for detecting nar-
cotics in commercial cargo. We will be
implementing improved fines, penalties
and forfeitures (FP&F) management tech-
niques and systems.

Much, however, remains to be done
in every area. The full benefits from ACS,
the air interdiction program, improved
narcotics interdiction and other comrner-

The Charleston Contraband Enforcement
(GET) Team will remember FY 1986. First
GET received the Commissioner's Citation
for their achievements in combating com-
mercial fraud. After the presentation, GET
named Senator Strom Thurmond of South
Carolina an honorary GET team member.
With District Director William C. Byrd and

Associate Commissioner Richard Miller
(center) looking on, Inspector Ty Bowers
presented a GET jacket to Senator Thur-
mond. Then in July the GET team
discovered 17,000 pounds of marijuana in
containerized cargo for the largest mari-
juana seizure ever in the Charleston district.

iitional
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ng our

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simpli-
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nalties
rttech-

cial initiatives can only be realized if we
have continued dedication, hard work,
commitment and innovation.

We have built a firm foundation for
success. And that indeed, is why there
has never been a better time to be in
Customs. Not only are we contributing
to most of this nation's priorities, but we
have laid the foundation for the long-term
productivity of the Customs Service to
contribute to whatever the national
border enforcement priorities are.

I would like to encourage each and
every one of you to continue the good
work you are doing. Based upon team
effort, a positive attitude and continuing
commitment, we will ensure that the
U.S. Customs Service in fact remains
among the best in the world and con-
tinues to be a willing and effective par-
ticipant in carrying out our national
priorities.

Ewer-Growing
Mission

Cl Carla Brooks supervises the transfer of

high-risk containerized textiles being

unstuffed at the Centralized
Station (CDS) in Baltimore.

i done
lACS,
)roved
mmer-

irtf

Miller
.owers
Thur-

team
ana in

mari-
istrict,

One of the oldest agencies of the
Government, Customs predates the
Department of the Treasury. It was
established on August 1, 1789, four
weeks after George Washington
signed the first U.S. Tariff Act.

From 1789 until 1793, Customs an-
nual collections totaled approximately
$2.5 to $3 million. The revenue was vir-
tually the only source of income for the
U.S. Government.

Customs collections financed a
period of unprecedented expansion:
the opening of the West, construction
of roads and railroads, and the pur-
chase of the Louisiana and Oregon ter-
ritories, Florida and Alaska.

After Congress levied an income tax
in 1913, the Internal Revenue Service
became the top revenue-producing
agency. But even today customs
duties amount to a significant source
of revenue more than $13 billion in
fiscal year 1986.

At its establishment, the U.S.
Customs Service was given the mis-
sion "to regulate the collection of
duties." Time has expanded rather

than altered that mission,
now:

Assesses and collects
duties, excise taxes, fees and |
due on imported goods.

Prevents fraud and smug<

Controls carriers, perse
cargo entering and depart
United States.

Intercepts illegal high-tec
exports to Soviet Bloc nations

Cooperates with other
agencies in suppressing the trc
legal narcotics and pornograp

Enforces reporting requ
of the Bank Secrecy Act.

Protects the American p
enforcing auto safety and
control standards, flammabl
restrictions, animal and plant
tine requirements.

Protects U.S. business a
by enforcing regulations dea
copyrights, trademarks and q

As the principal border enf<
agency of the United States,
enforces some 400 provisions
behalf of more than 40 Fede
cies.

CUSTOMS USA

Organization

Control

Part of the Department of the
Treasury, the U.S. Customs Service
predates that agency by one month.
Customs became a separate bureau in
1927. The Bureau of Customs was
renamed the U.S. Customs Service in
August 1973.

Today 45 districts and areas with
some 300 ports of entry are supervised
by seven Regional Commissioners.

The Commissioner of Customs is ap-
pointed by the Secretary of the
Treasury. Customs headquarters in
Washington, D.C. is organized into
five major offices headed by Assistant
Commissioners for enforcement, in-
spection and control, commercial
operations, international affairs and in-
ternal affairs. The Comptroller of
Customs oversees administration.

The Chief Counsel, an arm of the
General Counsel of the Treasury
Department, advises the Commis-
sioner on legal matters.

Overseas, U.S. Customs maintains
offices in U.S. embassies or consulates
in Bangkok, Bonn, Hong Kong,
Karachi, London, Mexico City, Ot-
tawa, Paris, Rome, Tokyo, Seoul,
Panama City, Vienna and The Hague.
An attache represents U.S. Customs in
the U.S. Mission to the European
Communities in Brussels.

The amnesty booth in the background is a
unique feature of the Military Customs In-
spection (MCI) program. Military personnel
are given the opportunity to discard any
prohibited items in the amnesty booth prior
to inspection by a designated military
Customs inspector.

Air

Customs has two main goals in the
area of passenger processing improv-
ing facilitation while not sacrificing en-
forcement. Toward that end, we are
continually refining our techniques.

Enforcement and facilitation have
improved with increased use of
sophisticated profiling systems such as
the Target Flight Connector System
(TFCS), which was developed by in-
spectors in Los Angeles.

TFCS, recently incorporated into the
Treasury Enforcement Communica-
tions System (TECS), is an analysis of
various data elements that allows
Customs to determine which arriving
flights pose the greatest enforcement
threat. As a result of TFCS, local
Customs management can tailor staff-
ing to effectively process high risk ar-
rivals.

Significant improvements were
made in increasing enforcement effec-
tiveness for private aircraft. Major

regulatory changes were implemented.
Agreements were reached with both
the Drug Enforcement Administration
(DEA) and the Federal Aviation Ad-
ministration (FAA) to increase informa-
tion available to Customs.

A comprehensive aircraft search
training program was developed and
conducted nationwide. A TECS-FAA
interface was developed which pro-
vides involved field offices with flight
plan information and the results of
TECS checks within 30 seconds of
receipt by FAA. It is operational in
Miami and San Diego.

An inspection team has been placed
at the El Paso Intelligence Center
(EPIC) to coordinate real-time assess-
ment and evaluation of DEA suspect
aircraft data. Major improvements
have been made to TECS to support
private aircraft enforcement including
an aircraft tracking system and new
aircraft lookout procedures.

Agreement was reached with the
National Law Enforcement Telecom-

munications System (NLETS) to ex-
pand the tracking system to include
state and local law enforcement
sighting and intelligence.

Air

During 1984 and 1985, the Customs
Service successfully developed pro-
grams of mutual cooperation and
assistance with the Air Transportation
Association of America (ATA) and the
International Air Transport Association
(I ATA) to prevent narcotics smug-
gling.

Specific agreements were signed
with eight high-risk carriers and
negotiations continue with several
other airlines. In addition, Customs has
won the endorsement of the Customs
Cooperation Council and the U.N.
Committee on Narcotic Drugs for this
program.

In maintaining the momentum of
this initiative during 1986, we began to
work closely with carriers, apprising
them of their areas of vulnerability
through regular meetings; providing a
training program on cargo, aircraft and
facility security; performing security
surveys; and compiling threat assess-
ments.

This program has been provided at
22 international locations involving 35
international air carriers. A total of over
1,100 mid- and upper-level airline and
airport supervisors have participated in
the training program.

Field and headquarters managers
have met with carriers, airport author-
ities and industry associations to rein-
force program objectives.

The use of passenger profiles,
manifest review and cargo selectivity
systems, together with the dedication
displayed by the inspectors and canine
enforcement officers in the Office of
Inspection and Control, has resulted in
a continuing rise in the seizure of hard
narcotics. This has been accomplished
with a relatively static number of of-
ficers.

While seizures of marijuana have
decreased, the demand for this
substance in the United States has
begun to decline proportionally.

Canine Enforcement Officer Alan VVolk
(now in Houston) and Bentley are search-
ing a plane that came into New Orleans In-
ternational Airport.

Recognizing the success of the
canine program, Inspection and Con-
trol has initiated an increase, to 160
teams nationally, of teams in the field.
Programs developed in conjunction
with air and sea carriers have likewise
been successfully implemented and
will be expanded in the future.

The Office of Inspection and Control
intends to continue to increase the
amount of narcotics interdicted within
the ports of entry through the in-
telligence gathered by the Designated
Intelligence Officers (Operations),

Operational Analysis Staff selectivity
criteria development, automated mani-
fest review, centralized devanning and
the refinement of all profile and selec-
tivity systems.

Revised CF 3461 As more and
more ports of entry began to come on-
line with ACS Cargo Selectivity, it
became evident that a new cover sheet
or release document was required. In
responding to the need for a unified
servicewide entry document, Cus-
toms, in negotiations with the Office of
Management and Budget (OMB) and
the brokerage community, improved
the CF 3461. This revision of the ex-
isting CF 3461 was designed to provide
all the necessary data for Cargo Selec-
tivity processing. It was also developed
to meet the requirements of the
automated manifesting module when it
becomes operative.

Designed also to be read by Optical
Character Recognition (OCR) ma-
chines, the revised CF 3461 is the
Customs document of the future, to-
day.

ACS Line Release System The

ACS Line Release System was
developed to provide better entry con-
trol with the benefits of ACS Cargo
Selectivity, to Customs and the im-
porting community, at our land
borders without hindering the free
movement of truck traffic.

The ACS Line Release System af-
fords the land border brokerage com-
munity, with headquarters approval,
the opportunity to identify shippers of
repetitive low-risk cargo shipments
that qualify for Line Release status.
Once identified and assigned a unique
headquarters control number, mer-
chandise is cleared at the land border
with a minimum amount of effort,
unless designated for an intensive or
random examination.

The Line Release System automati-
cally establishes the broker IOU with
Customs via the assignment of the en-
try number to the merchandise
documentation. The shipment is then
free to depart the Customs vehicle
lane.

CUSTOMS USA

Contraband Enforcement Team (GET) In-
spectors (l-r) Duke Jackles, Ken Gillespie,
Rudy ViSlacona and Homer Johnson in-
spect Nigerian pottery in a warehouse at

Los Angeles Harbor.

Centralized Examination Sta-
tionsIn response to the rapid growth
in recent years of container freight sta-
tions, bonded warehouses, truck and
rail terminals, Customs has developed
more innovative and expeditious
methods for the examination and
release of cargo. Due to the inordinate
amount of nonproductive inspectional
time required to travel from site to site,
the centralized examination concept
was developed.

Centralized examination stations
provide inspectional resources at a site
specifically designed for the physical
examination of cargo. At present,
through the Cargo Selectivity module
of ACS, a very large percentage of im-
ported cargo is routinely released upon
a document review without a specific
examination. As a complement to the
ACS Cargo Selectivity system, cen-

tralized examination provides locales
dedicated to the examination of only
those shipments identified for more in-
tensive examinations.

This concept therefore allows us to
improve the service we provide to the
trade community, while at the same
time keeping our operating costs
down.

Compliance by Post Audit Over

the past five years, Customs has util-
ized its audit capability to ensure com-
pliance in various ways. There have
been 2,373 routine audits performed
with $97.7 million identified in recom-
mended recoveries. Full support to
Customs commercial fraud efforts,
represented by 86 audits over the last
three and one-half years, has resulted
in an additional $46.5 million.

Customs also uses its auditors in
daily operations to more efficiently
utilize its manpower.

In 1982, Customs adopted an audit-
inspection approach to control its
1,500 bonded warehouses by sub-
stituting 52 auditors and inspectors for
475 other workers formerly required to
control the bonded warehouses.

Prior to its implementation we were
collecting in excess of $7 million for
reimburseable warehouse officers'

salaries from warehouse proprietors.
Under the Audit-Inspection Program,
the collections from proprietors in FY
1985 were approximately $2.1 million.
While reducing our costs (which were
passed to the private sector) by $5
million, we have implemented a more
efficient system and have maintained a
strong enforcement posture.

During 1986, Customs extended this
philosophy to controling its 200 foreign
trade zones with the issuance of new
regulations, saving 13 Customs posi-
tions and $4 million in costs.

In January, Inspection and Control
personnel from 20 airports as well as
representatives from Internal Affairs,
Investigations, Chief Counsel and the
Federal Aviation Administration at-
tended an Airport Security Conference
to discuss Customs role.

A Customs memorandum establish-
ing a standard policy on Customs role
in airport security and defining areas of
responsibility in light of a terrorist
threat was published as Customs
Directive 1440-04, on January 17,
1986.

In February an amendment to
Customs Regulations part 6, concern-
ing access to Customs security areas,
was published in the Federal Register.

This changed the Customs regula-
tions on an interim basis to require the
use and display of a Customs approved
identification strip or seal on existing
identification cards worn by employees
at airports accommodating interna-
tional air commerce. This identification
is to be worn by all employees requir-
ing access to the areas designated as
"Customs Security Areas."

Customs security areas are divided
into three zones. Zone one encom-
passes the Federal Inspection Site.
Zone two refers to the ramp, tarmac
and baggage or cargo staging areas.
Areas where international cargo is
stored, processed or handled are
designated as zone three.

The rules and regulations also state
that a five-year employment history
and reference check will be performed
by the employer for any employee
needing a security seal. Records of
background checks will be maintained
by the employers for audits performed
by the Office of Internal Affairs.

The Airport Security Program be-
came effective on March 5. Repre-
sentatives from the Office of Inspec-
tion and Control visited each affected
airport and regional headquarters in
order to answer questions concerning
implementation of this program.

The 37 affected airports include all
airports which handle scheduled inter-
national flight arrivals or departures.

The Customs-approved seal is a
holographic depiction of the Customs
seal approximately the size of a dime.
The seal will be placed on the
identification cards by a Customs of-
ficer. If the seal is removed from the
identification card, it is designed to
self-destruct, thus preventing transfer
of the seal.

Temporary seals consisting of a
holographic depiction of the Statue of
Liberty were used in the affected air-
ports prior to distribution of the
holographic depiction of the Customs
seal.

Enforcement

Customs Operation Exodus enforce-
ment program continued to play a ma-
jor role in the Administration's effort to
tighten controls on illegal exports. Ex-
odus focuses on high technology and
critical equipment such as military
spare parts, military equipment,
semiconductor manufacturing equip-
ment, large computer systems with
military potential that require licenses
to be exported from the country.

Experience collected during the past
five years has conclusively shown the
existence of an international network
of front companies and conspiracies to
channel such items from the United
States to the Soviet Bloc nations, as
well as to other proscribed countries
that aid terrorism such as Libya and
Iran.

The Exodus enforcement umbrella
also includes the illegal export of arms,
munitions, implements of war and
restricted weapons to prohibited

destinations. During FY 1986, Customs
was engaged in major embargo actions
directed against Nicaragua, Libya,
Iran, Cuba and South Africa.

All of the enforcement efforts under-
taken during FY 1986 required a major
commitment on the part of Customs
inspectors to examine high-risk exports
and on the part of special agents
assigned to foreign and domestic field
offices to conduct investigations of
criminal violations of the Export Ad-
ministration Amendments Act of 1985
and the Arms Export Control Act.

Customs has continued to maintain
a vigilant investigative stance in an ef-
fort to destroy criminal conspiracies
before they can harm this nation's na-
tional security.

Since its inception in October 1981,
Exodus has been responsible for over
5,000 seizures of merchandise valued
in excess of $335 million. During FY
1986, special agents made over 60 ar-
rests resulting in more than 50 convic-
tions for criminal violations of the ex-
port control statutes.

Miami Special Agent George Nimmoor ex-
amines part of a $4.2 million seizure found
in compressors during Operation Buckstop.

CUSTOMS USA

Many of the investigations involved
extensive coordination with foreign
governments due to complex diversion
schemes used by the violators to
smuggle restricted technologies out of
the U.S. by using one or two neutral
intermediary countries to mask their
ultimate destination. Some of the most
noteworthy investigations are sum-
marized below.

Edward J. El kins- On July 22,
seven individuals and five firms were
indicted in the Northern District of
Georgia for conspiring to illegally ex-
port implements of war and other con-
trolled items from the United States to
Libya. The investigation established
that the defendants exported two
Lockheed L- 100-30 aircraft (the civilian
version of the C-130 military aircraft) to
Libya via Benin. The defendants were
also attempting to purchase aerial
refueling systems that would effective-
ly convert the aircraft into KC-130
military refueling planes.

At the time of their arrest, the de-
fendants were attempting to purchase
KC-130 aircraft from Lockheed and
were negotiating to sell Libya bullet-
proof vests, combat helmets and ar-
mor kits for military vehicles.

Samuel Evans Arms Diversion
Case On May 6, Samuel Evans and
16 other defendants were indicted for
attempting to illegally export approx-
imately $2.5 billion of restricted
defense equipment to Iran using
falsified end-user certificates. The
equipment included missiles, F-4 and
F-5 military aircraft, Huey helicopters,
tanks, cluster bombs and a variety of
spare parts. The arrests and indict-
ments were the result of a highly suc-
cessful undercover investigation con-
ducted by Customs that effectively
prevented any of these items from
entering Iran.

Attempted Overthrow of the
Government of Surinam On July
28, Customs and FBI special agents ar-
rested 13 individuals following an
undercover investigation of a con-
spiracy to overthrow the Government
of Surinam. The 13 were arrested at
the Hammond, Louisiana airport where
they attempted to board an aircraft for
the flight to Surinam. On September
1 1 , nine of those arrested pled guilty to

conspiracy and to carrying weapons
aboard an aircraft engaged in interstate
transportation.

MV ValhaSla-ln October 1984, our
SAC-Boston office initiated an in-
vestigation into the smuggling of seven
tons of arms and munitions to the Pro-
visional Irish Republican Army from
the United States. On September 29,
1985, Irish authorities seized the vessel
Marta Ann which was laden with these
munitions.

On October 16, 1984, the Boston of-
fice seized the vessel MV Valhalla
which had been located in the Boston
harbor. The Valhalla had transported
the arms from the United States and
had transferred them to the Marta Ann
while on the high seas.

The Customs investigation was
aimed at identifying those individuals
responsible for the illegal arms exports.
During the investigation, information
was also developed that the suspects
were engaged in large-scale marijuana
smuggling activities. This information
resulted in the seizure of 33 tons of
marijuana and the MV Ramsland in the
Boston harbor on November 14, 1984.
The SAC-Boston investigation
culminated in April 1986 with the in-
dictment of seven individuals for viola-
tions of the Arms Export Control Act,
the Racketeer Influenced Corrupt
Organization (RICO) statute, Export
Administration Act, narcotics and
other offenses.

Extradition of Werner J. Bruch-
hausen On June 11, the United
Kingdom House of Lords rejected
Bruchhausen's appeal of his extradi-
tion to the United States to stand trial
for a variety of schemes to illegally
divert controlled technology to the
Soviet Union. Bruchhausen was ap-
prehended in the United Kingdom
following an extensive investigation by
Customs into illegal export violations
totaling over $1 billion. Bruchhausen is
currently in the United States awaiting
trial on a variety of charges.

Indictment of Wolfgang
Ribitsch On July 31, Wolfgang
Ribitsch was indicted by a Federal
grand jury for his part in attempting to
export $15,000 in licensable laser
equipment to Austria without a
Department of Commerce license.

Illegal Shipment of U.S. -Made
Computers from Belgium to
Austria- On May 30, 1986, the
Belgian Ministry of Economic Affairs
notified the American Embassy in
Brussels that a suspicious shipment of
computers was en route to Austria.
The shipment, weighing some 30 tons,
was described in the Belgian export
license as electronic alarms equipment,
including personal computers. The
end-user was cited as the Turkish Em-
bassy in Vienna. By the time the
American Embassy was notified, six of
the 30 tons of equipment had already
been shipped. Subsequent inquiries by
the Customs attaches posted in Paris
and Vienna disclosed that the Turkish
Embassy was a fake address and that
the shipment really contained a com-
plete Tektronix 4125 workstation a
highly advanced computer unit that
cannot be exported from the U.S.
without a license. Austrian officials
agreed to detain the shipment, and
Belgian authorities have moved to
cancel the export license. Customs
continues to investigate this diversion
of sophisticated computer equipment
from the United States to a member of
the Warsaw Pact.

Indictments in the Kleinberg
Case On February 7, a seven-count
indictment was returned against the
F.L. Kleiberg Co. and five other in-
dividuals charging them with violations
of the Export Administration Act and
conspiracy. The indictments resulted
from an 18-month investigation by a
number of Customs field offices into
the illegal export of computer systems
and test equipment to the People's
Republic of China. The investigation
revealed the intended use of the illegal-
ly obtained equipment for nuclear
weapons design. If convicted, the
violators could face a total of 60 years
in prison and/or $550,000 in fines.

Customs Fraud Investigations
Center Fraud violations are, by their
nature, complex and require many dif-
ferent modus operandi. The Customs
Fraud Investigations Center (CFIC) in-
tegrates the headquarters resources of
the Offices of Enforcement, Commer-

8

cial Operations and Inspection and
Control in direct support of field in-
vestigative activities. This support in-
volves monitoring ongoing investiga-
tions and reviewing Customs transac-
tions of known fraud violators, which
assists in identifying potential viola-
tors.

Using electronic data processing
techniques, the CFIC staff tracks
records in Customs huge data base;
develops fraud profiles; and searches
for relationships, trends and areas
where investigations may produce
greater revenues for the U.S.
Treasury.

These activities, along with com-
modity targeting and the intensified
enforcement posture of the Office of
Enforcement and the District Fraud
Teams, provide a leaner, action-
oriented direction towards detecting
and investigating incidents of commer-
cial fraud.

During the first nine months of FY
1986, 700 investigations involving com-
mercial fraud were undertaken by the
Office of Enforcement. In addition, ap-
proximately 300 cases were referred to
district directors for administrative ac-
tion.

Seizures for textile violations have
increased significantly each fiscal year
with 286 in 1984, 389 in 1985 and to
date in 1986, 510 seizures. FY 1986 tex-
tile seizures had a domestic value of
approximately $24.7 million.

For FY 1985 Customs made 483
copyright/trademark seizures with a
domestic value of $37.5 million. In the
first 11 months of FY 1986 such
seizures already totaled 406 with a
domestic value of $38.9 million.

Operation Tripwire Operation
Tripwire focuses Customs efforts on
the fields most susceptible to fraud:
textiles, steel, electronics and sugar
along with copyright and trademark
protection.

Transshipment of Korean Tex-
tiles -Since 1984, the Los Angeles
and New York field offices have been
conducting investigations involving the
transshipment of Korean polyster
fabric (quota category 612) through
Japan.

These investigations, initiated upon
information developed by Classifica-

To support the Blue Lightning Strike Force,
Customs established a state-of-the-art
command center. From its opening in
February through September 30, the Blue
Lightning Operations Center (BLOC) con-

tion and Value, Los Angeles, all appear
to share a single, central conspirator
domiciled in Japan. The objective of
this scheme has been to circumvent
quota restrictions negotiated with
Korea by declaring the fabric to be of
Japanese origin.

These lengthy and complex in-
vestigations have proven formidable
because by their very nature, they re-
quire crucial evidence from abroad.

To date, some 7 million yards of the
fabric have been identified as having
been transshipped and almost 1.5
million yards remain under seizure.

In addition, a total of 11 search war-
rants have been served, in the Los
Angeles and the New York City areas.
It is expected that civil and criminal en-
forcement activity will commence
shortly, regarding the importers of the
fabric.

Perhaps more significantly, these in-
vestigations have had an impact upon
the trade negotiating posture of the
United States.

Because these investigations have
provided evidence of a significant
transshipment of Korean fabric
through Japan, the United States
Trade Representative is trying to
negotiate enhanced control and en-
forcement regarding the importation of

trsbuted to 36 arrests and the seizure of
vessels, more than 3,000 pounds of cocai
and almost 50,000 pounds of marijuana.
-RCA photo

polyester fabric from Japan. This v
probably be in the form of workal
visa arrangement.

Darvel, Inc. After an extensive
vestigation, Darvel, Inc. of B
Gardens, Calif., pled guilty to violati
of two counts of 18 USC 542 (fraui
The company was ordered to p
$10,000 in fines and negotiations. T
company undervalued some 3
shipments of wearing apparel import
from Hong Kong and the Philippine
The loss of revenue of these impor
tions totaled $1,534,383. Civil action
pending.

Eagle Eye, Ltd. Eagle Eye, Lt
Philadelphia, and its Hong Kong
filiate pled guilty to four counts each
18 USC 542 (fraud) and 19 U
1304(e) (marking) in regard to the
legal importation of sweaters.

Fines totaling $40,000 were paid
the court and each firm received 1
years' probation for the marking vie
tions. The companies have collectiv
agreed to pay $280,000 in c
penalties and Customs recove
$160,000 from the sale of forfei
merchandise seized in connection v
the violations.

Steel The President's plan for
steel industry is in place, covering c
80 percent of imported steel \

CUSTOMS USA

voluntary restraint agreements
(VRA's).

Customs fraud detection efforts
have been concentrated on making the
administration of those agreements ef-
fective. This has meant close coopera-
tion with various agencies interested in
the steel trade, especially the Interna-
tional Trade Administration.

Canada's size, proximity and high
volume of steel trade makes the coun-
try a natural route for transshipment of
steel from VRA countries which are at-
tempting to circumvent monitoring.
Customs continues to work closely
with Canadian officials to see that
fraudulent circumvention is controlled.

Customs has also moved to control
steel shipments containing a greater
weight of steel than is manifested. In
May guidelines were issued to inform
the public and field officers on
weighing procedures and tolerances.
Since those guidelines were dissemi-
nated, about a dozen seizures have
been made based on weight overages.

During the past year, Customs has
concluded a number of cases based on
fraudulent practices during the Trigger
Price Mechanism period of price
monitoring. Earlier resolutions have
resulted in numerous criminal indict-
ments and convictions as well as
significant monetary settlements. The
cases awaiting resolution have poten-
tial for extending these precedents.

The CFIC continues to handle refer-
rals regarding steel fraud from other
agencies and the domestic steel in-
dustry. Information from the American
Iron and Steel Institute and other trade
associations concerned with steel im-
ports has been distributed to field of-
ficers. A large number of seizures and
detentions has resulted.

Ma ass Flange Corporation-
Special agents in Houston discovered
that Maass Flange Corporation of Sea-
ly f Texas had been importing steel pipe
flanges of East German origin and
declaring them as being of West Ger-
man origin. This fraudulent activity
resulted in a loss of duty at 21 percent
on an entered value of $250,000.

On June 3, Maass Flange pled guilty
of two felony counts and agreed to pay
duties and penalties of $250,000. This

investigation has spun off several
more, and the Special Agent in
Charge, Houston, is considering settle-
ment agreements on two of these.

Operation Bittersweet This ex-
tensive operation, conducted by the
Special Agent in Charge offices in New
Orleans, Miami, New York and
Baltimore, continues to produce huge
enforcement results.

These investigations are targeted on
false drawback claims for refined
sugar, which have defrauded the U.S.
Government of millions of dollars in
revenue.

As of the end of September, Opera-
tion Bittersweet had indictments of 42
companies and individuals, with 31
convictions. In addition, $1.9 million in
illegal profits and criminal fines had
been recovered. Court-imposed fines
and restitution, as yet uncollected,
total $1,305,000. Civil remedies are be-
ing pursued.

Copyright and Trademark Pro-
tectionThe value of industry coop-
eration in tracking down counterfeit
merchandise was proven in a San
Diego case involving the importation
and distribution of bogus Louis Vuitton
luggage.

The case, which took 13 months to
conclude, involved conspirators in San
Diego, Miami and New York. The in-
vestigation originally targeted counter-
feit Rolex watches. As penetration of

the group progressed, the focus
shifted to counterfeit Gucci and Louis
Vuitton leather goods.

On December 5, 1985, arrests and
seizures were made simultaneously in
several cities netting 11 persons,
numerous counterfeit watches and
hundreds of yards of raw counterfeit
Vuitton fabric. Louis Vuitton coop-
erated fully with offers of both person-
nel and money for evidentiary pur-
chases.

As the result of an 18-month in-
vestigation by the Special Agent in
Charge, New York, 21 persons were
arrested and some 500,000 counterfeit
watches with an estimated street value
of $4-5 million were seized.

For the first time in Customs history,
Title III authority had been used in a
case that was purely fraud.

The investigation centered on sup-
pliers, purchasers and residences
where records and /or counterfeit mer-
chandise were stored or assembled. All
but one party named in the indictments
had a previous arrest record. The sub-
ject company and its associates were
also major suppliers of counterfeit
sunglasses and perfumes.

Foreign Office Expansion Dur-
ing FY 1986, two new Foreign
Customs Offices, the Customs Attache

The Customs OV-1C Mohawk casts a
shadow near the smuggler aircraft on a
clandestine airstrip in Arizona.

10

Office in Vienna, Austria, and the
Senior Customs Representative Office
in Rotterdam, The Netherlands, were
established, opened and fully staffed.
When the consulate in Rotterdam
closed in June 1986, the office was
relocated as an Attache Office in the
American Embassy in the Hague.

Expansion of our foreign offices will
continue in FY 1987 with the pur-
suance of new office locations in New
Delhi in India, Manila in the Philip-
pines, Madrid, Spain and Stockholm,
Sweden.

The Office of Enforcement currently
has over 70 employees assigned to the
American embassy or consulate in 14
countries.

International Conference for
Customs Attaches This year Cus-
toms combined the International Con-
ference for Customs Attaches with the
annual ARCE/SAC Conference.

In June, the first annual Office of En-
forcement Management Conference
(ARCE/SAC/ Attache Conference)
was held in Indianapolis. U.S.
Customs Commissioner von Raab,
other headquarters personnel, all
Special Agents in Charge, all Assistant
Regional Commissioners (Enforce-
ment), all Customs Attaches and
Senior Customs Representatives and
several Regional Commissioners met
and discussed Customs national priori-
ty programs. This meeting provided an
excellent forum for improving the coor-
dination between Customs domestic
and foreign offices.

Special Operations The Special
Operations Branch coordinated the
automation of the headquarters Office
of Enforcement. The Pyramid and
AT&T systems are scheduled to begin
operation early in FY 1987.

During the year, the Undercover
Operations Unit was created to coor-
dinate all undercover operations, train-
ing and evaluation throughout the Ser-
vice.

In a successful effort to increase en-
forcement operational effectiveness, a
Servicewide enforcement reorganiza-
tion was effected in FY 1986.

At the headquarters level, the
Marine Interdiction Program was
relocated within the Smuggling In-
vestigations Division. This division is
responsible for the oversight of in-
vestigative activities and program
development with regard to general
smuggling, organized crime, por-
nography, financial investigations and
marine narcotics smuggling.

The division is divided into the Tac-
tical Investigations Branch, having
oversight responsibility for marine nar-
cotics interdiction and the Currency In-
vestigations Branch, which oversees
currency investigations of organized
crime groups, including those under
scrutiny in the OCDETF program.

Organized Crime Drug Enforce-
ment Task Force The OCDETF pro-
gram focuses the combined efforts of
the U.S. Customs Service, Drug En-
forcement Administration, Federal
Bureau of Investigation, Internal
Revenue Service, Bureau of Alcohol,
Tobacco and Firearms, U.S. Coast
Guard and the U.S. Marshals Service
on disrupting major criminal organiza-
tions engaged in narcotics and money
laundering.

Customs currently has 151 special
agents, 33 analysts and 29 clerks com-
mitted to this program, and has the
lead or a significant role in 27 percent
of the task force cases.

Task forces in those cases alone ac-
complished the following in fiscal year
1986:

OCDE Enforcement Results, FY
1986

Arrests 1,042

Seizures

Currency $46,230,228
Property $61,101,490
Cocaine 8,726 pounds

Heroin 227 pounds

Marijuana 209,858 pounds
The Child Pornography and Pro-
tection Unit The Child Pornography
and Protection Unit was formed on Oc-
tober 8, 1985 to enhance the U.S.
Customs Child Pornography Program.
The primary functions of the unit are to
coordinate pornography smuggling in-
vestigations within the U.S. Customs
Service and between Customs and
other agencies, as well as to collect,

analyze and disseminate child por-
nography data.

The unit is establishing an
automated data processing (ADP)
system, the backbone of the unit in
terms of data collection and dissemina-
tion.

Around the nation, Customs officers
took the following measures in por-
nography cases.

Child Pornography Enforcement
Results, FY 1986

Seizures 341

Mail 233

Non-Mail 108

Investigations

Opened 283

Closed 115

Indictments 63

Arrests 71

Convictions 61

Operation Buckstop In May
1985, the U.S. Customs Office of En-
forcement, in concert with the Office
of Inspection and Control, conducted a
national outbound currency operation
on flights (commercial and private) go-
ing to high-risk narcotic/money
laundering countries.

The operation utilized the combined
skills of special agents, patrol officers,
intelligence analysts, inspectors and
data systems personnel to target in-
dividuals using commercial and private
aircraft to transport illicit funds from
the United States.

During its one-month run in 1985
Operation Outbound resulted in the ar-
rest of 17 subjects and 47 seizures
totaling $4,844,401.

In October 1985, the U.S. Customs
office in Miami initiated Operation
Buckstop, a follow-on to Operation
Outbound. During a six-week period in
late 1985, officers involved netted $12
million dollars in illicit U.S. currency
headed toward narcotic source and
bank haven countries.

As a direct result of the Miami suc-
cesses, Operation Buckstop (Phase II)
was implemented on a national scale
and again targeted commercial aircraft
operations and passengers with an eye
toward the detection of drug money
being smuggled out of the United
States.

During its two-month run ending
March 31, Operation Buckstop

CUSTOMS USA

11

resulted in the arrest of 31 defendants
and 62 seizures totaling $15,793,526.

To date Operation Buckstop, Phase I
and II, has resulted in the seizure of
more than $27 million dollars in U.S.
currency.

Marine Interdiction/Operation
Blue Lightning Operation Blue
Lightning was conducted from April
3-27, 1985. This operation provided
24-hour coverage of all inlets, cuts and
access areas to the Florida coast which
had been identified as high-threat
areas.

It was a cooperative enforcement ef-
fort as manpower and other resources
were supplied to Customs by 22
Federal, state and local law enforce-
ment agencies as well as the U.S.
Coast Guard, the Bahamian Police
Force and the Bahamian Defense
Force. It significantly disrupted the
smuggling activities of individuals and
organizations.

Due to the success of this special
operation, a Blue Lightning Strike
Force was established on a permanent
basis in the South Florida area.

To support the Blue Lightning Strike
Force, approximately 50 Customs
radios on a special frequency have
been installed on state and local law
enforcement vessels in the operational
area.

A Blue Lightning Operations Cen-
ter/Joint-Marine Interdiction Com-
mand Center (BLOC/J-MICC) was
opened in February 1986 to coordinate
all marine interdiction activities in the
area, and 40 new interceptor vessels
are being procured to increase and up-
date the Customs fleet in this area. Ap-
proximately 150 new officers are also
being hired to increase Customs
strength in the area.

Special initiatives such as condomin-
ium-mounted radars, land-based radar-
equipped tethered aerostats and a
state-of-the-art High Frequency Single
Sideband radio network with voice
privacy are being used to improve
detection, sorting and tracking of
suspect marine targets.

Since its establishment in June
1985, the Blue Lightning Strike force
has been instrumental in the arrest of
117 persons and seizure of 8,511
pounds of cocaine; 231,926 pounds of

Senior Special Agent Gary W. Waugh,
now a branch chief at headquarters,
depicted in an enforcement situation.

marijuana; 48 vessels; 8 vehicles; 13
weapons; 5 aircraft; and $383,657 in
currency.

Customs is continually upgrading its
aviation program with new technology
and equipment and with improved tac-
tics and strategy. In 1986 the acquisi-
tion of four P-3 aircraft enhanced our
detection capabilities; we now have a
total of six Citation interceptors on-
board, with two additional on order.

The tracking capability of the Avia-
tion Program has been augmented
with the acceptance of the first three
of eight Customs High Endurance
Tracker (CHET) aircraft in. September
1986. The first of six C-12 aircraft was

Moments of danger and excitement mix
with the routine of enforcement work.

received from the Army; the last will be
delivered by November 1986.

An additional four Black Hawk
helicopters for high speed pursuit/ bust
purposes were accepted in 1986, bring-
ing our total to eight. The Cariball
aerostat was placed into service in
March, giving a greatly improved
surveillance capability in the Bahamas.

The Customs Service has entered
into negotiations with DOD for acquisi-
tion of seven Nomad aircraft equipped
with radar and forward looking infrared
(FLIR) which will be deployed ex-
clusively to support marine interdic-
tion. The Customs detection capability
will be enhanced by the addition of
four Grumman E-2C aircraft on loan
from the Navy and the construction of
five or more aerostats for improved

12

coverage across the southern border.

The national threat from airborne
drug smugglers is fluid and ever-
changing. To most effectively respond
to this threat and to achieve maximum
utilization of all available resources, the
Customs Aviation Program proposes
to implement a new resource deploy-
ment and utilization strategy.

This strategy will allow Customs to
expand from one to four modules, all
having 7x 16 (seven days a week, 16
hours a day) operational capability.
The strategy will provide for redeploy-
ment of certain critical equipment to
more effectively respond to enforce-
ment opportunities. The remaining
bases and units will operate on a 5x 8
or a modified 7x16 schedule, based
on operational needs and resource
availability.

The Flex-Force Strategy will provide
increased flexibility and mobility and
will more readily allow Customs to sup-
port the expanding detection capability
of the Customs Service. The strategy
will include certain unmanned sites
equipped only with necessary com-
munications systems and crew com-
fort facilities. These sites will serve as
temporary, standby bases for specific
operations or other scheduled enforce-
ment activities.

The Flex-Force Strategy will require
significant staffing increases within the
Aviation Program but will make it
possible to achieve greater operational
readiness throughout the program
than could be achieved with the same
staffing increases utilizing present
operational strategy and existing
scheduled equipment.

The U.S. Customs Service in-
telligence effort has expanded to sup-
port the needs of operational officers in
the areas of narcotics enforcement,
critical technology, commercial fraud,
financial analysis, child pornography
and counter-terrorism.

Regional Intelligence Branches (RIB)
at each of the seven regional head-
quarters provide direct intelligence
support.

Designated Intelligence Officers
(DIO) are assigned in every Special
Agent in Charge and District Director
office to provide intelligence support at
those levels.

The level of contact between
Customs and the members of the In-
telligence Community has shown a
steady increase, and tactical in-
telligence from multiple agencies is be-
ing disseminated to front-line enforce-
ment officers.

An artificial intelligence capability is
being developed to process the large
volume of data involved in financial
analysis, and its application for other
types of data is being assessed.

Narcotics Members of the Nar-
cotics Intelligence Division developed a
U.S. /Mexican Border Threat Assess-
ment based on combined information
provided by Federal, state and local
law enforcement elements located
along our Southwest Border during the
first half of FY 1986.

The division implemented an agree-
ment between Commissioner von
Raab and Administrator John Lawn of
DEA which enhances the reporting of
drug smuggling information from
selected DEA country offices in Latin
America.

U.S. Customs assigned the director
of the Narcotics Intelligence Division to
the Department of Customs of the

Kingdom of Saudi Arabia for a period
of four months during FY 1986. During
this time he advised Saudi Customs on
creating an intelligence system.

Commercial in response to a
growing terrorist threat over the past
year, analysts provided an increased
number of terrorist alert messages to
Customs line officers. When possible,
photographs of the suspects were
distributed. The division also initiated a
weekly Terrorist Situation Report
(SITREP) providing highlights of cur-
rent terrorist activities.

In a continuing effort to identify
critical technology to export control
teams, the Commercial Intelligence
Division will be distributing updated
manuals on super-minicomputers and
integrated circuit manufacturing equip-
ment. Three new handbooks on
special purpose computers, submersi-
ble equipment and nuclear technology
are forthcoming. Exodus locations will
receive a single volume containing all
of these handbooks.

On a continuing, real-time basis,
personnel enter TECS records on all
companies and individuals designated
as foreign nationals by the Office of
Foreign Assets Control. Additionally,
all economic sanctions and embargos
in force by the U.S. government are
available in the INTEL subsystem of
TECS. Copies of the 1986 Redbook
identifying terrorists and terrorist
organizations were procured by the
Commercial Intelligence Division.
Distribution to field offices was ef-
fected by the Office of Enforcement
and the Office of Inspection and Con-
trol.

Intelligence Liaison During FY
1986, the Intelligence Liaison Division
processed a high volume of classified
reporting from the intelligence com-
munity and law enforcement agencies.
More than 21,000 reports classified at

CUSTOMS USA

13

the Secret level and above were con-
trolled, reviewed and disseminated.

The Liaison Division obtained ap-
proval to downgrade or declassify in-
formation extracted from over 300
reports. This division provided for the
dissemination of a large volume of
classified reports for background use
to appropriate Customs attaches and
domestic field offices.

Intelligence Support The In-
telligence Support Division continued
to provide policy direction, budget
oversight and EDP/ADP applications
support for the Office of Intelligence.
Area Desk Officers furnished guidance
and assistance to field intelligence
components.

During the year, the division proc-
essed more than 600 requests for
special statistical extracts for arrest
and seizure data to support head-
quarters and field managers, respond
to Congressional inquiries and answer
questions from the Departmental level.
The division also produced more than
100 Memoranda of Information Re-
ceived (MOIR's), primarily relating to
Customs fugitives and the location of
persons involved in child pornography.
More than 1,908 requests from
Customs officers for file documents
from the Headquarters Central Files
unit were filled.

In view of the increased emphasis on
activities along the Southwest Border,
the Support Division initiated a weekly
situation report which is prepared and
disseminated to Department of the
Treasury, senior headquarters officials
and appropriate regional managers.

Financial Analysis During FY
1986, the Financial Analysis Division
(FAD) produced and disseminated in-
telligence products to Customs field
offices, IRS, Treasury and other
Federal law enforcement or regulatory
agencies. To gauge the utility of its in-
telligence products, the division
established a feedback system which
encourages FAD report users to com-
ment on the usefulness of the informa-
tion.

One FAD report prompted a
Customs enforcement office to open
an investigation which has thus far led
to the seizure of nearly $600,000 and of

ledgers suggesting money laundering
and narcotics-related activities. In-
vestigators have identified nearly 200
subjects who may be involved in this
large-scale narcotics money laundering
operation.

FAD's other accomplishments: (1)
implementation of the Customs Ar-
tificial Intelligence System (CAIS) to
highlight suspect financial activities;
(2) dissemination of a comprehensive
strategic study on the financial flows
and patterns along the U.S. /Mexico
border; (3) guidance in the preparation
of statistical reports for the Attorney
General's Commission on Pornog-
raphy; and (4) assistance in the
development of a four-week basic in-
telligence analyst course.

Northeast Region The Northeast
Regional Intelligence Branch (RIB) has
provided support to a major cocaine air
smuggling investigation which has
resulted in indictment of 12 individuals
alleging the smuggling of 7.5 tons of
cocaine and $25 million over a five year
period. Approximately $7.3 million has
been seized as a result of this investiga-
tion.

New York Region This RIB ini-
tiated a project which targets recipi-
ents of terrorist-related publications.
To date, more than 85 individuals have
been identified as members of related
student organizations. The RIB has
also identified numerous explosive
devices used by terrorists, which has
been of value to ports nationwide.

It played an integral part in coordina-
tion of the July 4th festivities for the
Statue of Liberty Centennial. A Source
Country Module Program, in which the
RIB and other internal and external
elements participate, resulted in the
seizure of 15 kilograms of heroin
secreted in a teakwood relief picture.

On September 8, the New York RIB
introduced a Commercial Fraud
Hotline (1-800-USA-FAKE). Fifty-six
calls were received during the first
week of operation, and the hotline
shows great potential for sources of in-
formation to initiate fraud cases.

Southeast Region This RIB
operates the 24-hour Drug Awareness
Program Hotline (1-800 BE-ALERT)
which serves the entire southeastern
United States. Since its inception, over
1,300 calls which provided intelligence
for potential enforcement action
against illicit drug activities have been
processed. One caller provided infor-
mation on a recent 300-pound cocaine
smuggling transaction. Enforcement
action resulted in the seizure of five
pounds of cocaine and the arrest of
two illegal aliens.

The Southeast RIB has disseminated
information regarding counterfeit
French fragrances. One seizure con-
sisted of counterfeit Georgio frag-
rances valued at $480,000.

South Central Region This RIB is
providing analytical support to Opera-
tion Bittersweet, a continuing nation-
wide investigation of fraudulent
drawback claims for refined sugar.
Results to date include the indictment
of 42 companies and individuals with
28 convictions and the recovery of $1 .9
million in illegal profits and fines.

The SC RIB also provided analytical
support to a major air smuggling/
money laundering organization. As a
result of the investigation, six defen-
dants were convicted and sentenced to
prison terms and fines totaling
$18,000.

Southwest Region The SW RIB
is heavily involved in the planning and
support of various initiatives relating to
Operation Blue Fire/Alliance, the U.S.
Customs and joint agency Mexican
border initiatives.

Highlights of the past year include
direct support to two major currency
cases. The first of these, Operation
Cash Crop, involved the indictment of
44 individuals/companies and the
seizure of over $20 million in assets. To
date, 14 individuals have been con-
victed in the drug-related portion of the
case. A second Houston-based curren-
cy case resulted in a guilty plea and
seizure of almost $2 million.

Pacific Region A footwear threat
assessment prepared by this RIB
revealed that 79 percent of the
shipments reviewed were in violation
of country-of-origin marking. The RIB
provided direct support to the Pacific

14

Illustrating the research and development
(R&D) process at Customs, inspectors
voiced a need for an X-ray system to detect

drugs and currency that could be moved

from site to site. R&D translated their re-
quirements into specifications for Customs

Basin Initiative and as a result of the
networks established has been suc-
cessful in tracking a major drug smug-
gling vessel from the Marshall Islands.
North Central Region The North
Central RIB and the Special Agent in
Charge, Detroit have been involved in
Operation Mecca West, a comprehen-
sive study of Middle East subjects
allegedly involved in various illegal ac-
tivities. The RIB also has provided ana-
lytical support to the Resident Agent in
Charge, Indianapolis in preparation for
the upcoming Pan Am Games schedul-
ed for August 1987.

Research and development em-
phasizes the application of state-of-
the-art technology to the detection of
contraband, especially illegal drugs.
Some of the projects being pursued in
this area are described below.

Miniature Camera Applica-
tionsThe introduction to the com-
mercial market of Charge Coupled
Devices (CCD) made possible the
miniaturization of camera-based
search devices for a number of possi-

first mobile X-ray van, then let a contract
for the mobile X-ray system pictured.

Drawing courtesy American Science and

Engineering, Inc.

ble Customs applications. Prototype
devices have been constructed for
Customs that allow the placement of
miniature cameras into dark, hard-to-
inspect locations in search of contra-
band with the video picture being
transmitted to and portrayed on a small
TV monitor.

A video scope (an alternative to
fiberscopes), a video probe (a camera
on an extendable pole) and a video
land drone (for viewing the underside
of vehicles) have been delivered to
Customs and are undergoing technical
evaluation prior to possible field
testing.

Mobile X-ray Systems Technical
specifications were developed for the
construction of X-ray systems in a
mobile van configuration. An award
was made for the delivery of up to nine
mobile X-ray systems for primary use
at airports on breakbulk cargo and bag-
gage.

Field use of mobile transportation
X-ray equipment during the year
established that such equipment could
be instrumental in detecting drugs and
currency in incoming and outbound air
shipments.

The systems to be built for Customs
will include some of the latest in image
enhancement capabilities and will
allow anticipated advances in image
enhancement technology to be added
at a later date. These systems will be
delivered during FY 1987.

Fiberscopes Fiberoptic devices
were field tested during the past two
years at several Customs locations and
were found to be useful tools for ex-
amining car doors, gasoline tanks and
other hard-to-inspect locations in
search of contraband.

In cooperation with the Offices of In-
spection and Control, a major procure-
ment of fiberscopes was made in late
FY 1986. At least 75 scopes were pro-
cured based on the technical and
operational specifications developed
by the Research and Development
Division. These instruments are high
quality, portable (with a minimal
weight battery pack) and easily
operated.

Nuclear Magnetic Resonance
(NMR)~- During FY 1985 operational
tests were conducted by Customs that
indicated NMR technology was effec-
tive for the detection of cocaine in let-
ter mail. In FY 1986 laboratory tests by
a university contractor showed that
NMR techniques could also detect
heroin and morphine in letter mail.
Technical specifications were drafted
and are being finalized to have a pro-
totype automated NMR system con-
structed during FY 1987 that will allow
the rapid screening of letter mail in
search of drugs.

Gamma Ray Backscatter Imag-
ingA joint project was undertaken in
cooperation with the Federal Aviation
Administration (FAA) for the develop-
ment of a single-sided imaging device
using gamma ray backscatter tech-
nology. A previous study performed
for Customs indicated the feasibility of
this approach for the detection of
suspicious densities hidden behind
opaque surfaces such as car doors,
airplane wings, walls, etc. While
Customs would use the technology in
search of drug contraband, possible
antiterrorist applications are apparent
for agencies such as the FAA, the
Federal Bureau of Investigation and
the Department of State.

CUSTOMS USA

15

Secure Weapons Cabinets Due
to the heightened concern for port
security along the southwest border,
the R8-D Division, in cooperation with
Inspection and Control, supervised the
construction and installation of 34
secure weapons cabinets. These en-
vironmentally protected cabinets were
built to the specifications of Customs
and hold two shoulder weapons in a
visible configuration that is secure yet
readily accessible.

Automatic Currency Reader
Customs developed the world's first
automatic currency reader capability a
few years ago. In FY 1986 technical
specifications were written for the con-
struction of a second generation
device that would have many of the
same capabilities but would be smaller,
faster and less expensive.

Another government agency has
shown particular interest in joining
Customs in a joint procurement of cur-
rency readers. As of the end of FY1986
Customs was seeking competitive
quotes to build and deliver up to 30
automatic currency readers during
FY1987.

Automatic License Plate
Reader This project has progressed
to the point at which final field testing
of a one-lane prototype took place in
1986 with permanent installation
scheduled for November 1986. The
license plate reader system uses optical
character recognition techniques, a
high-resolution, automatically shut-
tered TV camera and a microcomputer
to locate, read and enter license plate
data (state and number) into TECS in
two seconds.

Upon successful demonstration of
the technology through fielding and
use of the one-lane prototype, a com-
petitive fixed price solicitation will be
made for the installation of a multilane
system at a Southwest Border port of
entry.

Color Image Aerial Mapping of
the Southwest Border During the
past several years, in cooperation with
the U.S. Geological Survey, Customs
has been developing color image maps
(scale: 1 :25,000) of land borders. Final
products of this effort have been
published for New York, Vermont,
California, most of Arizona and a por-

tion of New Mexico.

During FY 1986 Arizona and New
Mexico were completed and emphasis
moved to the mapping of the Texas
border in cooperation with the Interna-
tional Boundary and Water Commis-
sion. It is anticipated that the
Southwest Border mapping effort will
be completed during FY 1987.

Other Technical Equipment In-
troduced Other state-of-the-art
equipment has been introduced in the
course of the year in support of
Customs varied missions:

Diamond verification devices: An
off-the-shelf device, based on heat
transfer characteristics of diamonds,
was evaluated and introduced to the
field to verify authenticity of diamonds
for valuation purposes.

Cannabis detection spray: A
detection spray for marijuana based on
color change was introduced by an in-
ternational export company and, after
verification of its efficacy and safety by
Customs, was fielded for test and
evaluation purposes. Based on early
successes with the spray, larger quan-
tities were purchased by the Office of
Inspection and Control.

Customs High Endurance
Tracker (CHET)-The first CHET
system SN28 was accepted by the
Customs Service on August 29. This
system is presently undergoing opera-
tional evaluation at Miami Air Support
Branch. The second CHET SN32 was
accepted on September 24.

Hydroacoustic Boat Detector
System (HYDAD)-A feasibility
equipment model was developed to
determine its effectiveness detecting
boat traffic in remote waterways.
Since the results of field testing this
feasibility model were encouraging, a
contract was awarded to make key im-
provements to the design of the
feasibility model and produce six pro-
totype field deployable units for ex-
tended field test and evaluation pur-
poses.

Commandable Beacons Tag-
ging devices, capable of being turned
on and off remotely, have been
developed for field installations where
a high risk of discovery may be en-
countered through electronic scanning
techniques employed by the suspect.

Both air and marine program officers
are using the 24 tagging devices pro-
duced this year.

Cargo Security Beacons These
tagging devices are particularly useful
in detecting illegal movements of
bonded cargo because the devices
have multiple alert modes. Twenty-five
additional units were produced this
year for distribution to agents nation-
wide to assist in ongoing cargo, drug
and currency cases.

Marine Interim Transponders -
Over 75 air traffic control transponders
have been modified for marine use and
installed in Customs and local law en-
forcement boats in the Southeast
Region. These devices aid Customs in
dispatching Customs and local law en-
forcement vessels for the interception
of suspect boats in the waters off
south Florida.

Surveillance Transponders One
hundred and twenty surveillance
transponders were produced for the air
program. Both the ''wire in" and "slip
in" varieties, they have special features
which make detection more difficult in
suspect aircraft. These transponders
have been distributed to all Customs
Air Units.

SATRACK Was initially conceived
in 1982 to determine if satellite tracking
systems could be used in support of
various Customs enforcement ac-
tivities. The satellite system should
provide position and tracking functions
at a very minimum.

Three systems have since been iden-
tified that could meet Customs opera-
tional requirements. They are the
Global Low Orbiting Message Relay
(GLOMR) satellite now being opera-
tionally tested by the Defense Ad-
vanced Research Projects Agency
(DARPA). The second system is the
NAVSTAR Global Positioning System
(GPS), a multisatellite system being
established by the Department of
Defense as a very accurate position
location system for mobile units. The
third system is the GEOSTAR system.

Electronic Identification Tag
(EIT) System Since 1982 Customs
has conducted experiments under proj-
ect SATRACK to determine if satellite
tracking (position location) systems
could be used in support of Customs

16

law enforcement activities.

Customs requires a system which
provides continuous coverage extend-
ing from the U.S. /Canada border to
northern South America, with tag
position data updated in real time.

In 1986 Customs generated the per-
formance specifications for the
development of a miniaturized Elec-
tronic Identification Tag (EIT) system
which would operate with a geosyn-
chronous satellite. A number of poten-
tial contractors were selected to com-

pete in the contract bidding process.

Attempts to circumvent Customs take

many twists. The importer in this case
called the item a fur rather than a sweater.
Assuming the garment were cleared by
Customs, the fur vest would be sent back
to the Far East for attachment to another
sweater.

During fiscal year 1986, Customs
stressed the increased use of radios for
real-time communications and life-line
support by:

Completing the conversion of the
Southeast and New York sector net-
works to Radio Voice Privacy (RVP)
and providing RVP mobiles and a
limited number of RVP portables to
Southeast regional enforcement per-
sonnel;

Ordering and shipping RVP equip-
ment to Puerto Rico, and performing
the preliminary work required to con-
vert their radio system to RVP;

Implementing a separate coastal
radio voice privacy network for the
Blue Lightning Operations Center
(BLOC), including installing a new con-
sole in the BLOC command center and
RVP mobiles on local and state police
vessels;

Providing emergency RVP equip-
ment to the Papago Indians;

Implementing the first two elements
of Customs new Over-The-Horizon En-
forcement Network (COTHEN)
remotely controlled fixed stations that
will significantly enhance the ability of
the BLOC and the sectors in Miami,
Houston and New Orleans to provide
communications support for air and
marine initiatives;

Installing the first of three prototype
COTHEN mobile units on platform
boats in the Miami area as part of the
Marine Module Program;

Ordering $14.5 million worth of
COTHEN equipment in support of the
Southwest Border initiative and the air
and marine programs;

Ordering $15.5 million worth of RVP
equipment in support of the South-
west Border initiative and Operation
Alliance, and supporting work for
establishing the Southwest Operation
Center (SWOC) in Houston; and

Conducting tests of portable RVP
repeaters on Cariball, Customs new
tethered aerostat.

During this same period, a new
secure communications program was
initiated to support the Exodus pro-
gram. Using second generation secure

telephone units (STU-II), it provides a
secure voice and/or data network
spanning 50 Customs locations.
Sophisticated data terminals and new,
more reliable secure facsimile equip-
ment were also linked to the STU-II
terminals at key locations throughout
the Service.

In addition, a secure communica-
tions network and key material
distribution system was implemented
for 12 Customs Aviation Operations
facilities using encrypted radio equip-
ment.

With respect to improved opera-
tional efficiency, accomplishments of
the Communications Management
Division (CMD) included the following:

CMD established a new Com-
munications Security (COMSEC)
Branch to manage the national COM-
SEC program and oversee COMSEC
accounts at 41 Customs locations.

The division brought Customs COM-
SEC program into compliance with
legal requirements established by the
National Security Agency (NSA) and
other governing Federal security agen-
cies.

CMD implemented Customs new
Headquarters Communications Center
within the alloted time frame and with
no loss in service.

After automating lease, circuit, site
lease, budget and other files and
records affecting management of
Customs communications program,
CMD used capabilties inherent to
automated record keeping to identify
and recover substantial overbillings for
circuit charges.

The division conducted the first
Regional Communications Conference
held in 10 years to obtain field input on
communication problems that are na-
tional, regional and local in scope.

CMD resuscitated a defunct $1
million Exodus communications sys-
tem in a manner that will continue to
save Customs more than $115,000 a
year.

In summary, this was a banner year
for Customs Communications Man-
agement Program one which helped
pave the way for the next generation of
radio communications equipment.

CUSTOMS USA

17

Commercial
Operations

Development, testing and deploy-
ment of the Automated Commercial
System (ACS) accelerated during
fiscal year 1986. As announced by the
Commissioner in January, the time-
table is to permit participating
members of the import trade com-
munity to conduct their business with
Customs electronically by the end of
1987.

ACS is rapidly becoming the focal
point for trade industry data automa-
tion by linking Customs brokers, im-
porters, carriers, service bureaus, port
authority systems and local custom-
houses.

The links permit electronic transmis-
sion of manifest and entry data to
Customs, and the return of cargo-
release and inspection decisions, along
with the up-to-minute status of entry
processing proceedings and reference
information. A broad base within the
trade community, including importers
and port authorities, is now active in
ACS development.

One of the cornerstones of ACS is
the Automated Broker Interface (ABI).
The number of broker clients grew
rapidly during the year. From 65 par-
ticipants in October 1985, 12 months
later the client list totaled 225, with 50
brokers operationally processing about
25 percent of all Customs entries. More
and more brokers are recognizing the
mutual benefit in merging their own
automation efforts with ACS.

Another important part of the inter-
face link involves the Automated
Manifest System (AMS) and port
authority interface with Customs for
inspection information.

AMS is operational in Norfolk, with
several other locations now pilot
testing data exchange with major sea

carriers. Port authority systems are in
the test phase in New Orleans and the
design stage in New York, while
feasibility studies are underway in five
other major ports.

Another cornerstone of ACS is
selectivity. The number of locations
with ACS Cargo Selectivity increased
to 47 during the fiscal year. Over 20
brokers have started using the ABI
cargo selectivity feature, which pro-
vides early release notice in exchange
for transmission of entry data to ACS.
A test of the paperless entry summary
concept .is scheduled for the South-
west Region in early fiscal year 1987.

Other key enhancements in ACS
started during the fiscal year include
Census Interface, which is operational
in 15 locations and eliminates the
statistical copy of the CF 7501 for ABI
brokers. The quota module of ACS
was implemented in August and
numerous improvements for broker
processing of entry summaries were in-
stalled during the year.

ACS is a high priority item on the
Customs agenda. In the Commis-
sioner's words, 'The U.S. Customs
Service, founded in 1789 by the Sec-
ond Act of the First Congress, has
reached a milestone in providing
ACS."

The Duty Assessment Division was
reorganized during 1986 and renamed
the Commercial Compliance Division.
This name more accurately reflects the
division's increased emphasis on en-
forcement and prevention of commer-
cial fraud.

Fraud Detection Section Infor-
mation and allegations of commercial
fraud received from individuals, in-
dustry representatives, trade associa-
tions, etc., are processed through the

Fraud Detection Section. The section
screens the information, checks with
the CFIC as to whether there is any
ongoing investigation, and notifies the
proper field and headquarters person-
nel, as well as the National Import
Specialist.

One of the primary enforcement
areas targeted by the section was the
Marking Initiative. Examinations of
merchandise for country-of-origin
marking violations which were under-
taken as a result of this initiative re-
vealed the percentage of violations to
be as high as 90 percent. Appropriate
corrective actions were taken and
verified by Customs with respect to
these shipments.

Entry Simplification Report A
major initiative, to evaluate "entry"
processing, was undertaken by an in-
teroffice task force. The group ana-
lyzed entry procedures and organiza-
tional structure at 10 locations process-
ing approximately 65 percent of the
total entry volume.

The efforts culminated in a "Single
Issue Conference on Entry Processing"
held in San Antonio July 28-29. The
conference addressed the changes re-
quired to fully carry out the automation
of Commercial Operations.

In preparation for the conference the
task force had prepared a comprehen-
sive report that defined the changes re-
quired to effectively carry out Customs
entry functions in the districts and
ports. Final recommendations have
been forwarded to the Commissioner.

Organizational structure, staffing,
position descriptions and procedures
are areas addressed in detail. Work
towards implementation has already
begun.

Commercial Operations will finalize
implementation plans upon receipt of
the Commissioner's decisions. Task
forces will be assembled in each
region, with headquarters oversight, to
assure the recommendations are im-
plemented expeditiously.

Entry Directive on Textiles and
Textile Products The Commercial
Compliance Division issued Customs
Directive 3500-07 dated February 28,
1986, after reviewing mounting
evidence that there had been a
dramatic increase in the number of

18

abuses and circumventions of textile
controls by the improper use of "ex-
empt certifications" for textile ship-
ments valued at $250 and under.

Customs found that these shipments
require greater and more knowledge-
able scrutiny. The directive states that
all commercial shipments of textiles
and textile products covered by most
textile tariff item numbers, regardless
of value, require a formal entry. This
new entry procedure insures a more
careful review of the entry documenta-
tion and examination of the merchan-
dise prior to the release of goods.

1

Report to the President on Tex-
tBe ImportsThe Commercial Com-
pliance Division provided major
technical input in the preparation of
the White House study on the impact
of the present level of textile imports.

The study's purpose was to deter-
mine if these imports exceeded per-
missible textile import levels agreed
upon in international negotiations and
to recommend any necessary changes
to the U.S. Textile Import Program. A
number of significant recommenda-
tions made in the February 1986 report
have already been implemented.

CBS Special Access Program

On February 20, the President an-
nounced a special program to
guarantee access to the U.S. market to
Caribbean-produced textile products
made from fabric wholly formed and
cut in the U.S.

This special access program went
into effect September 1.

Brokers Test The October edition
of the Brokers Test was compiled at
the U.S. Customs Service Academy at
Glynco, Ga.

The test was developed by two ex-
perienced Customs field officers. Its

As Customs worked with the trade com-
munity in developing the Automated Com-
mercial System (ACS), so trade officials
have automated in tandem with ACS. In

this photograph, the Commissioner is ac-
cepting a framed reproduction of the logos
for ACS and the automated system of the
port of New Orleans, presented by Dock

Board Commissioner Lucien J. Gunter.
Photo courtesy the Port Authority of
New Orleans

CUSTOMS USA

19

format and composition were directed
by the Commercial Operations Staff at
the academy to ensure conformity with
current testing requirements, The test
will be graded by the use of OCR at
Glynco and the results will be returned
to each district.

This year's test will have a com-
posite profile provided via computer so
that the test's effectiveness can be
determined at headquarters. As part of
this test development, a set of current
questions and those of previous tests
have been placed on a computerized
library for future access.

Operation Heavy Metal During the
month of November, the Commercial
Compliance Division led a task force on
the weighing of steel products that are
covered by Voluntary Restraint Agree-
ments (VRA) to ensure that such ship-
ments were in compliance with the
agreements. Many violations due to
weight overages were discovered.

In addition, a uniform policy for
handling VRA certificate validations
has been established reducing the
need for excessive repeat handling of
documents and ensuring the accuracy
of weights.

Quota System On June 23, the
Quota system became operational
under the ACS database. This permits
automated brokers to process their en-
try summaries through quota and have
their merchandise released quickly and
easily.

This interface of quota and ACS has
an added benefit where automated
selectivity exists. Quota items which
have not been processed will be
stopped from inadvertent release by
the selectivity module since the status
of processing is readily apparent in
these integrated systems.

The new quota system also provides
field locations with the capability of:
determining the status of any quota or
of any entry summary processed
through the system, verifying quota
TSUSA numbers and obtaining
various management information
reports.

FP&-F Program For the first time,
the Commercial Compliance Division
has established a centralized policy
program on the handling of Fines,

* r ..:/ - - -. enures (FP&F). A
Cu.r: r --.: "-:-- i .,:--.,;* -v. is being issued that
outlines ne administrative direction
that the field is to use in processing
FP&F matters.

Changes have also been made to the
current FP&F automated reporting
system to allow for specific tracking of
each case at the district, regional and
headquarters level. The system has
been designed to allow local manag-
ment to establish additional reporting
formats as well as give headquarters
the ability to obtain workload statistics,
caseload review and backlog control.
This system has been implemented at
locations handling 80 percent of all
penalty cases.

A course in the instruction of FP&F
administrative processing has been
established by the Commercial Com-
pliance Division and the Commercial
Operations staff at Glynco. This is the
first time any formalized training has
been designed and given to the FP&F
officers at the national level.

of

At the direction of the Assistant
Secretary of the Treasury (Enforce-
ment), the Commercial Compliance
Division spearheaded a comprehensive
study of the requirements of other
Federal agencies relating to imports,
with emphasis on those pertaining to
health and safety.

A meeting with representatives of
the Treasury Department and 14 other
agencies was conducted on May 8,
soliciting the cooperation of these
agencies in the preparation of this
study. The study concluded that, with
a few minor exceptions, sufficient con-
trols are in place to protect the health
and welfare of American consumers of
imported products.

Italian Wines Methanol Con-
taminationIn late March 1986, the
Customs Service and the Bureau of
Alcohol, Tobacco and Firearms
(BATF) became aware of incidents of
methanol contamination in wines in
the Italian domestic market. Customs
and BATF acted immediately to pre-
vent the introduction of any con-
taminated wines into United States

commerce. Initially, suspect wines
were not released until tested by the
BATF for methanol content and found
to be safe. The Italian Government
subsequently refused to permit wines
to be exported unless they had been
tested for methanol content by Gov-
ernment-approved laboratories. Due to
our quick joint efforts and the coopera-
tion of the Italian Government, no con-
taminated wines have reached
American shores.

Foreign Assets Control: Ban On
Krugerrands from South Africa
On October 1, 1985, the President
issued an Executive Order prohibiting
imports of South African krugerrands
effective October 11, 1985. Upon
publication of this order in the Federal
Register, the Commercial Compliance
Division immediately contacted the Of-
fice of Foreign Assets Control (OFAC)
to discuss its implementation.

A draft of OFAC's implementing
regulations was reviewed, and instruc-
tions were transmitted to our field of-
fices two days before the effective
date.

Libyan Sanctions The President
issued an Executive Order prohibiting
trade with Libya on January 7, 1986,
which included a prohibition on im-
ports effective February 1, 1986. Com-
mercial Compliance worked with the
Offices of Inspection and Control and
Investigations to draft implementing
instructions for Customs field offices
which were in place by January 21,
1986.

Operation Tripwire Customs Of-
fice of Commercial Operations con-
tinued to support the commercial fraud
efforts of the Service during FY 1986.
Through the first three quarters, Trip-
wire quantified an aggregate loss of
revenue in excess of $28 million. This
does not take into account potential
penalty assessments.

Regulatory Audit was heavily in-
volved in major operations like Opera-
tions Bittersweet and Steelshaft. In ad-
dition, there were 78 fraud audits in
progress. Headquarters Regulatory
Audit provided assistance to the In-
telligence Division by using the

20

Regulatory Audit Consignee Evalua-
tion Reporting System in targeting
assignments. Commercial fraud is the
number-one priority of Regulatory
Audit on a nationwide basis.

gyational Audit Plan As of the
third quarter of FY 1986, the regions
had completed or had in progress 556
audits of all types. Of these, 214 were
commercial fraud, multiregional or
significant importer audits. Also, $40
million in recommended recoveries
were identified, far in excess of the
year's goal and establishing an alltime
high for the program for any fiscal
year.

Foreign Trade Zones A final rule
was completed and published in the
Federal Register and became effective
in May 1986. The new regulations im-
plement an audit inspection approach
to zones and modernize the Customs
approach to foreign trade zones.

Steel and Textile Enforcement Ef-
fortsThe Technical Services Divi-
sion has three Mobile Metal Analyzers
(MM A) in operation for testing steel
and textiles on-site. Based in the New
Orleans, Los Angeles and Chicago/
New York Field Laboratories, the
MMA's are carried to docks, rail yards,
etc. in specially designed vans.

Besides the MMA itself, the vans
can accommodate two members of the
laboratory staff (usually a steel expert
and a textile analyst) and necessary
equipment, such as microscopes and
balances for textile work and
metallurgical equipment and special
scales for steel analysis.

Although originally focusing only on
steel, the mobile laboratory concept
was expanded to include textiles
because of the strong emphasis on tex-
tiles enforcement and because they are
well suited for mobile assistance.

Although the particular analyses per-
formed on steel and textiles are quite
different, the purpose is, in many
respects, the same: both are checked
for misclassification in terms of com-
position or false invoice claims, for
quota/visa requirements and for possi-
ble weight violations.

This year, the MMA staffs have
logged almost 35,000 miles and tested
merchandise from almost 3,000 en-
tries. A fourth MMA is being bought so
that Chicago and New York can main-
tain independent mobile enforcement
efforts.

Automation in the Labora-
toriesDuring the past year, the
Laboratory Information Management
System (LIMS) was established for the
Technical Services Division by the Of-
fice of Data Systems. LIMS replaced
the old laboratory reporting system,
allowing access to up-to-the-minute in-
formation on field laboratory samples
and other services for laboratory
managers and supervisors in head-
quarters and the field. "Paperless"
monthly operations reports for each
laboratory and the system as a whole
are now available on-line at head-
quarters.

Ethanol Ethyl alcohol (ethanol)
imported for use in gasoline carries an
additional duty of $.60 per gallon as
opposed to ethanol which is used for
other purposes.

Importers were attempting to cir-
cumvent this duty by mixing ethanol
with minimal amounts of other fuel or
fuel-compatible substances prior to im-
portation. The mixtures would then be
blended with gasoline after importa-
tion, much as pure ethanol would be,
as an octane enhancer to replace lead.

Headquarters Classification and
Value Division issued a series of ad-
ministrative rulings holding that the ad-
ditional duty applies to ethanol mix-
tures as well as ethanol imported
alone.

At the time of issuance of these rul-
ings, potential importers, by their own.
admission, were in the process of
negotiating contracts calling for the
delivery to the United States of more
than one billion gallons of the mixtures
through December 1986.

Aside from eliminating the potential
avoidance of more than $600 million in
additional duties, headquarters' quick
action deflected a lethal blow to the

fledgling fuel ethanol industry, a major
consumer of surplus domestic corn
production and a beneficiary of signifi-
cant tax incentives.

Fabricated Structural Steel Im-
ports of structural steel ' from many
developed steel-producing countries
are subject to quota restraints. Steel
fabricators, located in countries that
are not subject to steel quotas, have
been purchasing structural steel from
quota countries and, after further proc-
essing, have been entering the steel as
a product of the non-quota country.

In order to clarify the questions as to
the country of origin of these steel
products, the Classification and Value
Division has issued several detailed rul-
ings on the nature of the processing
that results in a change in the country
of origin.

These rulings, together with a
special operational procedure for
handling entries of structural steel,
provide guidelines for the field offices
and for the business community, and
are evidence of our continued efforts
to enforce the steel restraint
agreements.

Caribbean Basin Initiative
(CBD/Generalized System of
Preferences (GSP) The division
issued regulations which eliminated
the requirements for certification by
foreign governments of the Certificate
of Origin Form A which must accom-
pany a claim for duty-free treatment
under the GSP and the CBI.

Free Trade with Canada The
United States and Canada have begun
discussions on a free trade agreement.
These discussions, although still in the
early stages, involve several important
Customs issues, including formulation
of a rule of origin for the agreement.

Attorneys from the Office of Regula-
tions and Rulings have been providing
the legal and technical presentation of
the U.S. rule. This rule is based on the
much-discussed concept of substantial
transformation.

Our expertise in country-of-origin
issues is assisting both governments in
identification and evaluation of the
numerous problems that will confront
the negotiators in agreeing on a rule of
origin.

CUSTOMS USA

21

U.S. Customs Service
1301 Constitution Averse
Washington, D.C. 20229
(202) 566-8195

COMMISSIONER OF CUSTOMS

COMMISSIONER'S STAFF

CHIEF COUNSEL

William von Raab (202) 566-2101

Mieko Kosobayashi

Michael T. Schmitz (202) 566-5476

Confidential Assistant

DEPUTY COMMISSIONER

(202) 566-2101

COMPTROLLER

Michael H. Lane

C. Wayne Hamilton (Acting)

(202) 566-2145

D. Lynn Gordon

(202) 566-2414

Executive Assistant to the

Commissioner (202) 566-9161

^|S3^

ASSISTANT COMMISSIONERS:

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Charles Parkinson

^OBTvsHk**." Bft

Associate Commissioner

ENFORCEMENT

ltm&T\mm

Congressional and Public Affairs

William Rosenblatt (202) 566-2416

RIB ^$b^ HI

(202) 566-9102

INTERNATIONAL AFFAIRS

IwGSTOBtf

David Gencarelli

James W. Shaver (202) 566-5303

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Director Congressional Affairs

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(202) 566-5644

INSPECTION & CONTROL

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Samuel H. Banks (202) 566-2366

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Dennis H. Murphy

Director Public Affairs

COMMERCIAL OPERATIONS

(202) 566-5286

Gerald McManus

(202) 566-5497

U.S. Customs

Earl M. Mitchell
Special Assistant to the
Commissioner (Equal Opportunity)

INTERNAL AFFAIRS
William Green (202) 566-8518

(202) 535-9002

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IREC

;1ORY

REGIONAL
OFFICERS

NORTHEAST

NEW YORK

SOUTHEAST

SOUTH
CENTRAL

SOUTHWEST

PACIFIC

NORTH
CENTRAL

100 Summer St.

6 World Trade Ct.

99 S.E. 5th St.

423 Canal St.

5850 San Felipe St.

300 N. Los Angeles St.

55 E. Monroe St.

Addresses

BOSTON

NEW YORK

MIAMI

NEW ORLEANS

HOUSTON

LOS ANGELES

CHICAGO

MA 02110

NY 10048

FL 33131

LA 70130

TX 77057

CA 90053

IL 60603-5790

(213) 894-5901

Regional

William J. Griffin

Edward E. Kwas

George Heavey

J. Robert Grimes

William Logan

Quintin L.

Richard McMullen

Commissioner

(617) 223-7506

(212) 466-4444

(305) 536-5952

(504) 589-6324

(Acting)

Villanueva, Jr.

(312) 353-6250

(713) 953-6843

(213) 894-5901

Asst. Regional

Edward A. Goggin

Anthony Liberia

Garnet Fee

David P. Banowetz

Fred R. Boyett

Robert Trotter

James Piatt

Commissioner

(617) 223-7548

(212) 466-4487

(305) 536-5952

(504) 589-6476

(713) 953-6843

(213) 894-5901

(312) 353-8002

(Operations)

Regional

John deRomoet

Melvin N. Minsky

Stuart P. Seidel

James M. Moster

David P. Lindsey

Paul E. Wilson

Saul N. Perla

Counsel

(617) 223-0075

(212) 466-4562

(305) 536-4321

(504) 589-6981

(713) 953-6827

(213) 894-5936

(312) 353-7860

Regional Director

William Rudman

Anthony L. Dondrea, Jr.

Charles C. Mantle

Ronald R. Bernhard

Kenneth E. McNamara

Robert D. Maloof

Internal Affairs

(617) 223-6603

(212) 466-5928

(305) 536-5306

(504) 589-2187

(713) 953-6989

(213) 894-2564

Asst. Regional

Donald S. Donohue

David J. Ripa

Leon Guinn

Larry LaDage

John Burns

John Hensley

Donald Watson

Commissioner

(617) 223-1080

(212) 466-5641

(Acting)

(Acting)

(713) 953-6843

(Acting)

(312) 886-9596

(Enforcement)

(305) 536-5952

(504) 589-6499

(213) 894-4692

Public Affairs

Edward V. Callanan

Janet Rapaport

Clifton V. Stallings

Liz Orgeron

Charles W. Conroy

Mike Fleming

Cherise Mayberry

Officer

(617) 223-1846

(212) 466-4547

(305) 536-4126

(504) 589-2976

(713) 953-6905

(213) 894-5939

(312) 886-3377

Customs Districts

(Note: New York has Area Directors instead of District Directors)

Pac. Anchorage, Alaska 99501 / 620 E. Tenth Ave., Suite 101 (907) 271-4043

N.E. Baltimore, Maryland 21202 / 40 S. Gay St. (301) 962-2666

N.E. Boston, Massachusetts 02109 / 2 India St. (617) 223-6598

N.E. Buffalo, New York 14202 / 111 W. Huron St. (716) 846-4374

S.E. Charleston, South Carolina 29402 / 200 E. Bay St. (803) 724-4312
S.E. Charlotte Amalie, St. Thomas-Virgin Islands 00801/

Main P.O. Sugar Estate (809) 774-2530

N.Cen. Chicago, Illinois 60607 / 610 S. Canal St. (312) 353-6100

N.Cen Cleveland, Ohio 44114 / 55 Erieview Plaza (216) 522-4284
S.W. Dallas/Fort Worth, Texas 75261 / 700 Parkway Plaza, P.O. Box 61050 (214) 574-2170

N.Cen. Detroit, Michigan 48226 / 477 Michigan Ave. (313) 226-3177

N.Cen. Duluth, Minnesota 55802 / 515 W. First St., 209 Fed. Bldg. (218) 720-5201
S.W. El Paso, Texas 79985 / Bldg. B, Room 134

Bridge of the Americas P.O. Box 9516 (915) 541-7435

N.Cen. Great Falls, Montana 59401 / 600 Central Plaza, Suite 200 (406) 453-7631

Pac. Honolulu, Hawaii 96806 / 335 Merchant St. / P.O. Box 1641 (808) 546-3115
S.W. Houston/Galveston, Texas 77052 / 701 San Jacinto St., P.O. Box

52790 (713) 225-2334
S.W. Laredo, Texas 78041-3130 / Mann Rd. & Santa Maria / P.O. Box

3130 (512) 723-2956
Pac. Los Angeles/Long Beach, California / 300 S. Ferry St.,

Terminal Island 90731 (213) 514-6001

S.E. Miami, Florida 33131 / 77 S.E. 5th St. (305) 536-4101

N.Cen. Milwaukee, Wisconsin 53202 / 517 E. Wisconsin Ave. (414) 291-3924

N.Cen. Minneapolis, Minnesota 55401 / 110 S. Fourth St. (612) 349-3990

S.Cen. Mobile, Alabama 36601 / 250 N. Water St. (205) 690-2106

S.Cen. New Orleans, Louisiana 70130 / 423 Canal St. (504) 589-6353
N.Y. New York, New York

New York Seaport Area, New York, New York 10048
Customhouse, 6 World Trade Center

Kennedy Airport Area, Jamaica, New York 11430
Cargo Bldg. 80, Room 2E

Newark Area, Newark, New Jersey 07114

Airport International Plaza (201) 645-3760
S.W. Nogales, Arizona 85621 / International & Terrace Sts., P.O. Box 670 (602) 287-9163

S.E. Norfolk, Virginia 23510 / 101 E. Main St. (804) 441-6546

N.E. Ogdensburg, New York, 13669 / 127 N. Water St. (315) 393-0660

N.Cen. Pembina, North Dakota 58271 / Post Office Bldg. (701) 825-6201

N.E. Philadelphia, Pennsylvania 19106 / 2nd & Chestnut Sts. (215) 597-4605

S.W. Port Arthur, Texas 77642 / 4550 75th St. (409) 724-0087

N.E. Portland, Maine 04112 / 312 Fore St., P.O. Box 4688 (207) 780-3326

Pac. Portland, Oregon 97209 / 511 N.W. Broadway (503) 221-2865

N.E. Providence, Rhode Island 02903 / 24 Weybosset St. (401) 528-5080

N.E. St. Albans, Vermont 05478 / Main & Stebbins St., P.O. Box 111 (802) 524-6572/8

N.Cen. St. Louis, Missouri 63105 / 120 S. Central Ave., Suite 408 (314) 425-3134

Pac. San Diego, California 92188 / 880 Front St., Suite 559 (619) 293-5360

Pac. San Francisco, California 94126 / 555 Battery St., P.O. Box 2450 (415) 556-4340

S.E. San Juan, Puerto Rico 00903 / P.O. Box 2112 (809) 723-2091

S.E. Savannah, Georgia 31401 / 1 East Bay St. (912) 944-4256

Pac. Seattle, Washington 98174 / 909 First Ave. (206) 442-0554

S.E. Tampa, Florida 33602 / 301 S. Ashley Dr. (813) 228-2381
S.E. Washington, D.C. 20041 / POB 17423

Gateway 1 Bldg., Dulles Intl. Apt., Chantilly, Va. 22021 (202) 566-8511

S.E. Wilmington, North Carolina 28401 / One Virginia Ave. (919) 343-4601

Duane Oveson
A. Robert Beikirch
John V. Linde
Carlton L. Brainard
William Byrd

Ralph C. Muser
Richard Roster
John F. Nelson
David Greenleaf
William L. Morandini
William Knobleuch

Walter D. Sherman
Don W. Myhra
George Roberts

Manny Najera
Joseph Castellano

John Heinrich
Harry W. Carnes
Richard L. Rudin
Robert W. Nordness
David L. Willett (Acting)
Joel R. Mish

(212) 466-5817 Peter J. Baish

(718) 917-1542 John J. Martuge

Max G. Willis
Peter F. Gonzalez
Phil Spayd
William Dietzel
Raymond J. Hagerty, Jr.
Anthony Piazza
Richard J. Garcia
Emery W. Ingalls
Clyde Kellay, Jr.
Vacant

Frank R. Spendley
Theodore Galantowicz
Allan J. Rappoport
Paul Andrews
Daniel C. Holland

Diane Zwicker

Sidney A. Reyes
James Mahony

Telephone numbers listed are those which may be dialed commercially.

Published by the United States Customs Service / Washington, D.C. 20229 / (202) 566-3962 / November 1986

CUSTOMS USA 22

Now the Acting Assistant Commissioner
for CommerciaS Operations, Jerry
McManus joined Customs attorneys and
National Import Specialists in practical

Hardboard/Wood Products

The division issued a ruling concerning
chemicals exported for use in a special
process to treat cedar shakes and
shingles so as to make them fire re-
tardant. The chemicals were con-
sidered to be an integral part of the
shakes and shingles so that no
allowances in the duty assessed could
be made for the value of chemicals
when the products were imported into
the United States.

In an unrelated matter, the division
issued a decision, upon a unique re-
mand from the Court of International
Trade, on the correct tariff classifica-
tion of certain hardboard building
boards. The matter was before the
Court because of a domestic interested
party petition filed by the pertinent
U.S. trade association.

The division found that the board
was, in fact, a laminated building
board, thereby making it dutiable. Prior

training on the Harmonized Description and
Coding System. The Harmonized System is
scheduled to replace the current tariff
coding system Fn 1988.

to this decision, these hardboard
building boards were being entered
under a duty-free provision for building
boards (other).

Orange Juice The division issued
a ruling holding that the recent crea-
tion of eo nomine provisions in the
Tariff Schedules for orange juice
meant that concentrated orange juice
shipped to Mexico, where it was
diluted, returned to the United States
and ultimately reconcentrated, could
no longer be classified as a beverage,
not specially provided for. This deci-
sion resulted in a significant increase in
duty payments on this product.

Valuation In recent years, certain
importers of merchandise from coun-
tries which impose export restrictions
on such merchandise (an export quota,
for example) have gained export ap-
proval from the government of the
country of origin by presenting export
invoices based on false merchandise
values.

This resulted in the presentation to
Customs, upon the entry of the mer-
chandise into the United States, of
documents which contained false
statements.

Although statute mandated that the
correct purchase price of each item ap-
pear on documents presented to
Customs, some ports had been ac-
cepting erroneous documents provid-
ed that at the time of entry the falsities
were disclosed and accurate informa-
tion presented.

Under our new policy, before entry
will be accepted, all documents
presented to Customs must contain
accurate cost or purchase price infor-
mation. The major advantages of the
new policy are the facilitation of the
valuation function, under which it will
no longer be necessary to "go behind"
documents presented to us to ascer-
tain accurate prices, and the issuance
of a message to the importing com-

24

munity that Customs will not accept
erroneous or false documents.

Carrier RulingsThe Carrier Rul-
ings Branch drafted legislation, which
the Commissioner approved and which
has been transmitted to Treasury,
substantially revising the laws concern-
ing the collection of tonnage duties
and light money.

In addition to modernizing these
laws, some of which date back to the
founding of the Republic, the draft
legislation raised the rates of tonnage
duties consistent with the increase in
the Consumer Price Index since the
rates were last changed, resulting in a
projected yearly increase in revenue of
approximately $108,000,000.

The branch provided the House Mer-
chant Marine and Fisheries Committee
with technical advice on a proposed
amendment to the coastwide towing
statute (46 U.S.C. 316(a)). The amend-
ment was passed by the Congress and
then vetoed by the President, because
of other provisions, and was passed
again by the Congress without the of-
fending provision and signed into law
by the President as Public Law 99-307.
The amended law closes a loophole
through which foreign tugboats could
be used for towing and pushing in
United States harbors and other
waters.

Carrier Rulings provided direction on
the launching of approximately 70
vessel repair entries covering the 12
new foreign-built Econships of U.S.
Lines. These involve an estimated $10
million in potential vessel repair duties
if the company is unable to establish
that various work done abroad is not
subject to the 50 percent duty.

Currently, the Carrier Rulings
Branch is drafting a bill which would
amend or repeal a significant number
of obsolete navigation laws and provi-
sions of the Tariff Act of 1930, as
amended.

Also, in this past year, the United
States Court of Appeals affirmed the
decision of the Court of International
Trade that a floating drydock is not a

vessel and, therefore, is subject to duty
under the Tariff Schedules of the
United States. Duties in controversy in
this case totaled more than $1 million.
The decision, in upholding the
dutiability of the drydock, sustained
the position of the Carrier Rulings
Branch and Customs with regard to
the dutiability of floating drydocks in
general.

Drawback and Bonds The
Drawback and Bonds Branch con-
ducted a seminar on the new bond
language promulgated under T.D.
84-213. It was attended by over 60
Customs officers from all regions. In a
Customs first, the seminar was
videotaped to serve as a training aid.
Copies of the videotape have been
made and are being sent to the regions
so that all Customs personnel who deal
with bonds can receive benefits of the
seminar.

Drawback and Bonds assisted in the
development of new regulations on
Foreign Trade Zones which were pro-
mulgated as T.D. 86-16. These regula-
tions completely revise the relation-
ships between the Customs Service
and the private parties who operate
and use zones.

Alerting Treasury to the problems
associated with proposed legislation
dealing with drawback on sugar which
could frustrate the ongoing criminal
and civil prosecutions under Operation
Bittersweet, the branch advanced
arguments which were adopted by the
Department in successfully countering
the legislation.

Drawback and Bonds analyzed and
successfully opposed a legislation pro-
posal that would have severely limited
the Customs Service in any proceeding
against a surety on a Customs bond.

The branch initiated a regulatory
proposal to deny the benefits of
foreign trade zones and bonded ware-
houses to persons who have been con-
victed of felonies.

Penalties

Entry, Licensing and Restricted
Merchandise Recently enacted
legislation, including the Tariff and

Trade Act of 1984, the Semiconductor
Chip Protection Act of 1984 and the
Trademark Counterfeiting Act of 1984,
has helped the Customs Service com-
bat counterfeiting.

The Entry, Licensing and Restricted
Merchandise Branch has published
guidelines to help Customs officers en-
force the new laws. These include
Federal Register notices containing a
solicitation of public comment on
"gray market" policy options, general
enforcement guidelines for protection
of copyrighted computer programs
and a chapter on copyright, trademark
and patent enforcement which was
added to the Customs Fines, Penalties
and Forfeitures Handbook.

The branch has streamlined its
decision-making process and tur-
naround time for copyright and
trademark recordations has been ac-
celerated. Progress has been made in
efforts to computerize these recorda-
tions.

The branch continued to play an im-
portant role in the intensified effort to
enforce compliance with the country-
of-origin marking law. Improved coor-
dination between legal, technical and
operational personnel within Customs
and frequent exchange of views with
importers, manufacturers and con-
sumer groups have enhanced Customs
effectiveness in this area. These efforts
are an important factor in maintaining
fair competition between domestic and
foreign producers.

Miscellaneous Penalties During
fiscal 1986, the Miscellaneous
Penalties Branch closed 1,706 cases
resulting in mitigated penalties of
$40,598,504. The Miscellaneous
Penalties Branch, with the approval of
the Department of the Treasury,
assessed $7 million in civil penalties
against individuals engaged in money
laundering of the illicit proceeds from
the narcotic transactions of several
large international organized crime
groups.

In several other typical cases involv-
ing the unlawful transportation of
unreported monetary instruments
either into or from the United States,
judicial proceedings were sought to
forfeit some $800,000 to the Govern-
ment.

CUSTOMS USA

25

In conjunction with criminal pros-
ecutions and other law enforcement
activities, these penalties and
forfeitures have a significant negative
impact on criminal enterprises that
violate Federal narcotics law.

In two cases that exemplify the
diversity of its responsibility, the
Miscellaneous Penalties Branch re-
quested the initiation of proceedings to
forfeit gambling devices valued at
$316,000 and clip-on dolls valued at
$400,000.

The gambling devices (video poker
machines), after suspect importation,
were illegally diverted for use in a state
where such games of chance are pro-
hibited.

The clip-on dolls, purportedly ra-
coons, were discovered to be piratical
copies of the Cabbage Patch creations,
recorded with Customs. The violator in
this case had committed prior
copyright infringements.

Miscellaneous Penalties also
authorized the imposition of a $7
million penalty against a vessel owner
for violation of the general prohibition
of coastwide transportation of mer-
chandise by a foreign vessel. The
vessel had illegally carried 210,000 bar-
rels of fuel oil between San Francisco
and Boston.

Among the many significant cases
closed during the fiscal year are the
following:

F & R Construction In an elab-
orate scheme to evade Puerto Rican in-
come taxes, F & R Construction and
three of its principals transported
$1,567,109 in bearer certificates of
deposit from Puerto Rico to Panama
without reporting them to Customs.

The certificates were originally
issued under false names, and the plan
was to transport them to Panama for
collection. The violators pled guilty to
making a false statement and a $10,000
criminal fine was imposed.

Because of the aggravated nature of
the violation, a $340,000 civil penalty
was imposed by the Treasury Depart-
ment.

1584 Guidelines In an attempt to
stem the flow of illegal controlled
substances into the United States on
board common carriers, more stringent
guidelines for both the imposition and

mitigation of penalties for failure to
manifest such substances have been
imposed.

Carriers are now presumed to be
negligent whenever a commercial
quantity, defined as any heroin,
isonipecaine, smoking opium prepared
for smoking or other opiate, two
pounds of more of cocaine or other
coca extract, 10 pounds or more of
hashish or 50 pounds or more of mari-
juana is found on board.

A carrier must perform a certain
number of precautionary measures to
avoid a finding of gross negligence.
More stringent mitigation guidelines,
ranging from 25 percent of the penalty
imposed to no relief, have also been
imposed.

Lineas Argomar The carrier was
subjected to a $3,133,575 penalty at
the port of Houston when 7,827
pounds of unmanifested marijuana
were imported aboard the MV Irazu.
The marijuana was secreted in cartons
purported to contain tile. The company
disclaimed responsibility because it
stated that the containers were re-
ceived on a "said to contain" basis.

Because it was determined that in-
adequate precautionary measures had
been taken, i.e., detector dogs alerted
immediately and could have been used
by the carrier, administrative relief was
limited in that the penalty was
mitigated to $1,566,787.

MV Morant Bay Ten cases in
just one year involving the importation
on board the MV Morant Bay of a total
of 2,284 pounds of unmanifested mari-
juana and a penalty of $862,600 were
considered.

John P. Hail-John P. Hall
burglarized his parents' residence and
removed $4 million in U.S. Treasury
notes, municipal bonds and stock cer-
tificates, of which $1,035,000 were in
bearer form.

Using a stolen and altered passport,
he transported them to the Bahamas
without reporting them to Customs,
and attempted to redeem them
through a brokerage house.

The instruments were recovered and
returned to their rightful owners. John
P. Hall was fined $10,000 and sentenc-
ed to one-year imprisonment. The
Treasury Department has recently

assessed a $1,035,000 civil penalty.

Tonolli Canada Ltd. Customs
issued a joint mitigated penalty of
$1,177,408.23, based upon findings
that Tonolli, as a result of intent to
defraud the revenue, had entered an-
timonial lead alloy into the commerce
of the United States under Item 806.30
of the Tariff Schedules of the United
States, with false processing declara-
tions.

It was claimed that no substitution
had been made to replace any of the
scrap batteries imported into Canada
from the United States from which the
lead alloy was processed, when in fact
the scrap batteries had been com-
mingled with or substituted by scrap
lead from Canada. If the lead alloy had
been produced solely from scrap bat-
teries made in the United States,
duties would have been assessed only
upon the cost of processing. The
above decision was affirmed upon
reviewing the supplemental petition for
further relief.

Mercedes-Benz of North Amer-
ica and Mercedes-Benz Truck
Company Voluntary tenders from
the above companies in the amount of
$979,880 and $102,814 were accepted
as full settlement of all potential claims
for duties and penalties under 19
U.S.C. 1592, against the companies
with respect to their failure to declare
material assists in connection with the
importation of rebuilt engines and
transmissions from Daimler-Benz of
West Germany.

The material assists not declared
consisted of used engines and
transmissions supplied to Daimler-
Benz at no charge or credit under an
exchange program, which were not
declared when the engines rebuilt from
these used parts were imported into
the United States by Mercedes Benz.

Walter Loesche d/b/a World
Food Center, Inc. Petition for relief
from a penalty assessed in the amount
of $28,218,693 was denied in the above
case. Involved were importations of
orange juice concentrate from the
foreign trade zone in Atlanta by means
of the false description that it consisted
of an orange drink called Myso. The
false descriptions, which were found
to have resulted from fraud, caused a

26

lemist Fred Collins explains the dsstinc-
>n between porcelain and stoneware to
<th grade students from a school in New
-leans. Collins retired in 1986 after 50
iars of Government service.

>tal duty loss in the amount of
3,341,477.

In connection with the same acts,
/alter Loesche had pled guilty to
olations of 18 U.S.C. 1341 (mail
aud) and 1001 (false statements to
le Government).

Other Significant Cases
ustoms headquarters issued a deci-
on dated April 4, 1986, for
^,728,288, to Commodore Business
lachines, Inc. The decision sustained
3ld allegations of fraudulent violations
: section 1592. The penalty was
>sessed against Commodore for filing
ilse GSP claims for datasettes im-
Drted from Taiwan between 1981 and
583. To date, Commodore has
sndered over $580,000 in revenue
sses which occurred as a result of the
olations.

Apex Valve & Fitting Corporation
aid the Government $250,000 in
snalties to settle a case involving the
leged removal of country-of-origin
iarkings from imported flanges. The
anges were to be relabeled and sold
> U.S. -made. In addition to the
snalties paid pursuant to the settle-
ent, Apex paid the Government over
100,000 in marking duties.
Customs headquarters issued a
itigation decision for $440,678, on a
ipplemental petition by Brandeis in-

tsel & Company, Inc. for additional
relief from a penalty assessed under
section 1592. The violation involved
material omissions and a misdescrip-
tion of imported ferrochromium from
the People's Republic of China.

The Regulations Control and Dis-
closure Law Division initiated discus-
sions with the ACS Division regarding
release of vessel manifest information
to the public, possibly on a fee basis.

The projected nationwide implemen-
tation of the vessel manifest portion of
the ACS will enable Customs to pro-
vide the public with trade information
which, prior to the ACS, could not be
retrieved in a cost-effective manner.

We anticipate that public awareness
of the availability of the information,
once it comes on-line, will generate a
sufficient demand to offset part of
these automation costs, which would
have been incurred in any event.

Disclosure Law The Disclosure
Law Branch coordinated with ACS to
implement the statutory commitment
of maintaining the confidentiality of
importers/consignees identities which
appear on vessel manifests.

The branch and ACS are developing
the necessary data base to ensure that
manifest information is protected.
Once the data base is established, the
Disclosure Law Branch will update it
on a daily basis.

An additional benefit to the im-
porting community will be eliminating
the delay presently encountered in
granting confidential treatment.

As part of the Airport Security ini-
tiative, the Disclosure Law Branch
worked with the Office of Inspection
and Control to identify and meet the
requirements of the Privacy Act which
relate to background checks on in-
dividuals seeking access to Customs
secured areas. A principal object was
to ensure timely implementation of the
program to meet the potential threat of
terrorist activities.

Regulations The Regulations
Control Branch of the Office of Com-
mercial Operations continued to play a

vital role in the missions of all Customs
units by coordinating various projects
and then finalizing each initiative into a
document which satisfied the Customs
objectives with a minimum of burden
on affected segments of the importing
community.

Significant projects included im-
plementation of several Congressional
initiatives relating to the Comprehen-
sive Crime Control Act of 1984, the
Trade and Tariff Act of 1984, the
Cultural Property Implementation Act
and the Consolidated Omnibus Budget
Reconciliation Act of 1985.

Working closely with representatives
of offices having operational respon-
sibility, the branch concluded numer-
ous projects relating to the entry and
clearance of aircraft and shipments
carried by aircraft, the seizure of
obscene articles, prior disclosures of 19
U.S.C. 1592 violations and the disposi-
tion of seized and forfeited property.

In addition, a major revision of the
regulations concerning the licensing
and operations of Customs brokers
was completed.

Legal Retrieval The Legal
Retrieval and Dissemination Branch
responded to 1,212 Freedom of Infor-
mation Act requests. Under the Deci-
sions/Rulings microfiche program,
1,500 copies of Office of Regulations
and Rulings (ORR) rulings and deci-
sions were added in fiscal 1986, bring-
ing the total number of rulings
microfiched up to 28,500.

In addition, 55 rulings were pub-
lished as Customs Service Decisions
(CSD's) in the Customs Bulletin with
an equal number published in the Legal
Determination format for field dissem-
ination. The Legal Precedent Retrieval
System (LPRS) Keyword Index was
brought up to 30,263 microfiche
frames, an increase of 1,295 frames
over the previous year. This represents
an increase of 32,000 separate index
reference points for a total of 620,000
reference points in the LPRS.

Customs is presently working to
develop a legal reference and retrieval
data base. The planned system will
feature a fully automated index to ORR
decisions and rulings as well as provide
for full text retrieval.

JSTOMS USA

27

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For the 4th European Regional Customs
Conference, the United States sent a
delegation including Assistant Commis-
sioner James W. Shaver, Commissioner
William von Raab, U.S. Ambassador to
Madrid Thomas 0. Enders and Assistant

Secretary of State for International Matters
Ann B. Wrobleski. Representatives from
Spain, where the conference was held, in-
cluded Director General of Spanish

Customs Humberto Rios-Rodriguez, Sub-

director General Luis Herrera and Chief of
the Contraband Unit Ezekiel Abad.

Photo by Felipe Suso, United States In-
formation Service

The Office of International Affairs
Narcotic Control Programming for
1986 placed particular emphasis on the
premise that drug abuse is a global
problem, and therefore, drug interdic-
tion must be a cooperative effort
among source, transit and so-called
victim countries. All in fact are victim
countries.

Commissioner von Raab and the
Assistant Commissioner for Interna-
tional Affairs traveled to Bogota, Co-
lombia in June. The visit was arranged
at the request of the U.S. Ambassador
to Colombia to underscore the U.S.
commitment to narcotics interdiction.

During his visit Commissioner von

Raab met with both the outgoing
President of Colombia and the
President-elect as well as influential
members of the Colombian press and
business community. He expressed his
appreciation for the efforts, both
governmental and private, that Colom-
bia was making to deter drug smug-
gling and offered whatever assistance
U.S. Customs could provide.

As drug routes change, so does the
need to develop new ways to meet the
changes. The special problems
presented by heavy drug trafficking in
the islands of the East Caribbean called
for special maritime interdiction opera-
tions.

U.S. Customs combined resources
with the U.S. Coast Guard to develop
and conduct maritime interdiction
training for Antigua, Barbados,
Grenada and Jamaica. Host country
and U.S. embassy reports have been
very positive.

U.S. Customs sent instructional
teams overseas to conduct training in
detecting and interdicting narcotics
and dangerous drugs to customs and
other enforcement officers in China,
Colombia, Egypt, Jamaica, Nigeria,
Pakistan and Venezuela. Regional pro-
grams were held in Puerto Rico and
Thailand.

In order to stem the flow of drugs to
areas beyond the scope of countries

28

funded by the State Department's
Bureau of International Narcotics Mat-
ters (INM), Customs-funded programs
were provided in Hungary and the
Netherlands and a self-funded course
was conducted in Qatar.

Other related narcotics control train-
ing initiatives involved providing in-
structional support for the United Na-
tions Division of Narcotic Drugs
(UNDND) Regional Narcotics Control
Seminar in New Delhi, India in
December 1985.

To assist target countries in institu-
tionalizing their narcotics control ef-
forts, the Office of International Affairs
gave a Train-The-Trainer Workshop in
Washington in 1986. This program was
conducted in August for participants
from Colombia, Ecuador, Uruguay,
Belize, Trinidad-Tobago, Panama and
Barbados.

ference

Leading Customs officials from 21
countries and four international
organizations met in Madrid, Spain,
May 21-22 with an intensive narcotics
interdiction agenda. Topics ranged
from technological advances to the
policy considerations and creative pos-
sibilities for mutual cooperation and
assistance.

All but three of the participating
customs administrations were repre-
sented by their Directors or Deputy
Directors General. At Commissioner
von Raab's suggestion, the delegates
adopted as the unifying theme of their
discussions the expanding role of the
Director General in narcotics enforce-
ment.

They agreed that the dimensions of
the narcotics problem demand vigor-
ous involvement at the highest level if
customs administrations are to have
the political, financial and operational
support necessary to confront it.

They also agreed that the burgeon-
ing menace of world terrorism is the
enforcement twin to the narcotics
problem, inextricably linked to it in
both cause and effect, and in the
customs methodologies for combating
it.

Conferees also focused on the need
for constantly improving mutual infor-
mation gathering and sharing systems;
for more uniform customs judicial
powers in the financial and narcotics
areas; and for closer bilateral coopera-
tion and more practical multilateral
cooperation instruments.

A draft report and recommendations
issuing from the conference are now
under review by the participants. Upon
completion of their review, U.S.
Customs will publish and distribute a
final report.

Delegates represented: Austria,
Bulgaria, Cyprus, Denmark, the
Federal Republic of Germany, Finland,
France, Greece, Hungary, Ireland, Ita-
ly, the Netherlands, Norway, Portugal,
Spain, Sweden, Turkey, the United
Kingdom and Yugoslavia, as well as
the United States (Department of
State, Customs Service and Drug En-
forcement Administration).

Canada, Saudi Arabia, the Customs
Cooperation Council, the European
Community Customs Union Service,
Interpol and the United Nations Divi-
sion of Narcotic Drugs, together with
the U.S. agencies, sent a total of 24
observers.

The conference was organized by
the U.S. Customs Service, Office of
International Affairs, under the
auspices of the Department of State,
Bureau of International Narcotics Mat-
ters, and chaired by Commissioner von
Raab.

Assistance

A unique Short-term Advisory/
Assistance Project was conducted for
Brazil in September 1986. This pro-
gram involved employing the expert
skills of an instructor from the Customs
Academy to assist Brazilian Customs in
implementing their newly developed
narcotics detection training program.

The advisor provided the Brazilian
Customs Training cadre with a short
program on methods of instruction,
practice teaching exercises and a com-
prehensive analysis of their training
program.

A specialized project was also pro-
vided for the government of Thailand
in the fall. This was the Thai Mail proj-
ect which was developed due to the
extensive amounts of opium (458
pounds) that were intercepted from
mail parcels from Thailand in FY 1985.

To counteract this threat, a short-
term advisory program was conducted
to assist Thai International Mail and
Customs officials in creating profiles
based on selectivity; segregating high-
risk letters and parcels; effecting con-
trolled deliveries; and organizing con-
traband enforcement teams or other
intensified enforcement operations
within the mail facility in Bangkok.

The International Narcotics Control
Executive Observation Program is
directed towards developing anti-
narcotics strategies in cooperation
with the highest officials of a foreign
customs or related law enforcement
agency. Participation is at the invita-
tion of the Commissioner of Customs
and the Department of State.

The program begins with executive
consultations at Customs Service
headquarters and follows with obser-
vation visits to selected Customs
operational sites. During FY 1986, top-
level customs executives from China,
Nigeria and Panama visited the United
States under the program.

As the Department of State's Anti-
Terrorism Assistance Program moves
into its third year, U.S. Customs in-
volvement now includes specialized
training as well as participation in the
Phase I seminars for high level foreign
officials.

For countries participating in Phase I
of this program, the U.S. Customs
Service, provides familiarization
seminars, along with the Department
of State, Department of Transporta-
tion, FLETC, FBI, FAA, BATF, INS
and DEA.

CUSTOMS USA

29

Topics discussed center on agency
functions in dealing with the terrorism
issue, including concepts of crisis
management, hostage negotiations,
transportation security, customs and
immigration controls, media relations
and interagency coordination.

During FY 1986, executive level
seminars were conducted for Pakistan,
a group representing the Gulf Coopera-
tion Council (United Arab Emirates,
Bahrain, Qatar, Oman, Saudi Arabia,
Kuwait), the Netherlands, Bolivia,
Peru, Malaysia and Somalia.

This program has provided U.S.
Customs with the opportunity to make
these countries aware of the functions
that it performs which have a potential
application in dealing with terrorism
and to establish contacts with in-
dividuals in these governments with
whom future dealings may occur.

Customs provided training in obser-
vation techniques, document examina-
tion and contingency planning in the
Philippines and Tunisia. Training also
was conducted at the Transportation
Safety Institute in Oklahoma.

The Deputy Commissioner of U.S.
Customs met with the Deputy Minister
of Canada Customs and Excise in Van-
couver, June 3-4, to review progress
on joint initiatives and to set future
direction for cooperative efforts.

The project to establish common
border facilities straddling the border at
Danville, Washington and Carson,
British Columbia, along with Noyan,
Quebec and Alburg, Vermont, ad-
vanced significantly during FY 1986.
The Danville/Carson facility is sched-
uled for completion the fall of 1987,
and Noyan/Alburg the summer of
1988.

The two officials signed an action
plan for cooperation in commercial ac-
tivities, including computer to com-
puter interface, automated systems
development, rulings retrieval and Har-
monized System training programs.

The first personnel exchange pro-
gram was completed in June. In-
telligence officers from both customs
services were exchanged to provide a
better understanding of the enforce-

ment efforts on both sides of the
border and to improve cooperation
between Canada and the United
States. Due to the success of the first
exchange, areas for future exchanges
have been identified for possible pro-
grams in FY 1987.

Indonesia U.S. Customs, in
cooperation with the Harvard Institute
for International Development, provid-
ed advisors to the Indonesian Ministry
of Finance. The main areas of interest
were drawback and bonded ware-
houses.

Bangladesh The United Nations
requested the assistance of a U.S.
Customs advisor to review customs
operations in Bangladesh and identify
those procedures that could be im-
proved with the use of computers.

American Samoa At the request
of the Treasury Department of
American Samoa, U.S. Customs com-
pleted an improvement plan for the
American Samoan Customs and Ex-
cise Service. This project was funded
by the Department of the Interior.

Liberia Three permanent advisors
continue in an advisory capacity to im-
prove collection procedures for the
Government of Liberia's Ministry of
Finance. Recently installed import
specialist teams and improved controls
and supervision over bonded
warehouse operations have resulted in
increased assessments and stabilized
collections despite a continuous
decline in imports over the past four
years. This Agency for International
Development (AID)-funded project has
been approved for extension to
December 1988.

ECOWAS-Another AID-funded
project in Africa provides technical
customs assistance to the Economic
Community of West African States
(ECOWAS).

During the first year of his assign-
ment, our advisor was instrumental in
establishing the ECOWAS Community
Computer Center in Lome, Togo. His
primary responsibilities for the coming
year include technical and manage-

ment consultations to ECOWAS
members for the development and ex-
pansion of the community computer
programs and national customs com-
puter projects.

Italy The long-standing informal
relationship between U.S. Customs
and Italian Customs advanced to a
pledge of mutual assistance formalized
at the signing of a Mutual Customs
Assistance Agreement. Commissioner
von Raab and Director General Can-
tiello signed this agreement to further
enforcement cooperation, in New York
City on November 5, 1985.

Spain Negotiations for bilateral
cooperation with Spain began in 1978
and evolved into staff-level agreement
upon a text at negotiations in Madrid in
March 1984. The State Department
has approved final signing of a
U.S. /Spain Mutual Assistance Agree-
ment and we anticipate the signing
early in 1987.

Korea Formal negotiations with
Korean Customs for a mutual assist-
ance agreement, which began in
Washington in mid-1984, led to
ultimate agreement upon a text in
September of 1985. Requisite State
Department approval for a formal sign-
ing of the agreement has been secured
and final signing is scheduled for Oc-
tober 1986.

Sweden Following informal dis-
cussions with Swedish Customs in
June 1984 in Washington, formal
negotiations held in Stockholm in May
1985 resulted in substantial accord
upon a text for a mutual assistance
agreement. Further negotiations in
Washington in April 1986 led to initial-
ing of an agreed upon text. Final sign-
ing of an agreement with Sweden is
expected to occur in early 1987.

The Customs Cooperation Council
(CCC) is a 97-member international
body with headquarters in Brussels,
Belgium. It is dedicated to the facilita-
tion of trade through increased interna-
tional cooperation between customs

30

Saudi Arabian Customs officers are
evaluating a new inspection tool sent to
them by their counterparts in U.S.
Customs.

administrations, to the simplification
and harmonization of customs systems
throughout the world and to effective
enforcement through increased inter-
national cooperation. The Secretary
General, G. R. Dickerson, is a former
U.S. Customs official.

At its June 1986 sessions, the Coun-
cil unanimously adopted a declaration
concerning the CCC's role in the field
of customs enforcement. Commis-
sioner von Raab, as Vice-Chairman of
the Council, submitted the declaration
to the CCC for approval. The "Brussels
Declaration" can assist members to
achieve the cooperation required for
effective and coordinated national and
multilateral strategies to combat
customs and other offenses.

At these sessions, the Council also
adopted a protocol of amendment to
the CCC's Harmonized System Con-
vention, designed to assure implemen-
tation of the convention on January 1,
1988. The Harmonized System is an in-
ternational goods classification sys-
tem. The convention is currently open
for signature.

At the initiative of U.S. Customs,
the. CCC is establishing an expert
group on air courier and fast parcel
services. The intent is to study and har-
monize existing sytems, while pro-
moting both enforcement and facilita-
tion.

The Office of Foreign Missions
(OFM), Department of State, was
established in October 1982, in
response to a growing concern that
U.S. diplomats serving abroad were
not being afforded the same rights and
privileges as those extended to
diplomatic representatives of foreign
governments serving in this country.

Customs has been involved in OFM
from its inception and has had a per-
manent representative to that office
since September 1983. More recently,
Customs realigned its staff to meet the
increasing needs of OFM by creating
the Foreign Diplomatic Advisory Staff
within the Office of International Af-
fairs.

Since its formation, OFM has con-
ducted a comprehensive review of the
rights, privileges and benefits con-
ferred upon foreign diplomats with a
view to establishing reciprocity.

Based on this review and other
ongoing developments, the OFM has
periodically requested the Customs to
institute procedures which favor or
penalize a given country based upon its
treatment of U.S. personnel serving
abroad. This procedure has been used
effectively in modifying customs prac-
tices in a number of countries.

The end result has been improved
conditions for diplomats serving
abroad and a recognition that customs
regulations and procedures can be ex-
ercised to provide leverage to the
Department of State in insuring the
greatest possible equity for U.S.
diplomats and for the overall economic
benefits of this country.

In the past year OFM further
streamlined its operations by con-
solidating its customs, tax and motor
vehicle programs and relocating them
in a new building in the vicinity of the
various foreign embassies. This reloca-
tion facilitated the dealings between
the diplomatic community and OFM.

In February, OFM converted to a
new IBM computer system. This in-
creased the capabilities of the OFM en-
tities and linked OFM activities with
other Department of State operations.
OFM is now fully integrated with the
Office of Protocol's data system and
has access to all accreditation informa-
tion on the diplomatic community.

Operating under the sponsorship of
the U.S. /Saudi Arabian Joint Com-
mission on Economic Cooperation,
Customs Office of Saudi Arabian Pro-
grams provides technical assistance
and advice to the Saudi Arabian
Department of Customs in areas of
computerization and automation,
training and law enforcement. This
program is funded entirely by the
Government of Saudi Arabia.

The primary goal of the com-
puterization effort is for Saudi na-
tionals to acquire the skills and ex-
perience to develop, manage and
operate their own data processing
system serving the major ports of the
Kingdom.

Accomplishments include the estab-
lishment of an .Automation Depart-
ment within Saudi Customs; construc-
tion of and migration to a new Saudi
Customs Computer Center; and the
design, development and initial in-
stallation of several major automated
systems.

United States-based education for
Saudi Customs is provided at Arkansas
State University, Jonesboro, Ark.

CUSTOMS USA

31

Training components supporting the
goa! of providing computer systems
development, management and opera-
tions skills to Saudi Customs officers
are: 1 ) an eight-month Customs opera-
tions course which includes technical
communications and an introduction
to data processing; 2) business and
public administrative degree programs
which provide management training;
and 3) a degree curriculum in computer
science appropriate to the re-
quirements of Saudi Customs.

During FY 1986 about 200 Saudi
Customs employees were involved in
various training programs in Arkansas.
Saudi Arabian wives have also par-
ticipated in training and educational
programs in Jonesboro.

Since the early days of the program,
U.S. Customs has provided assistance
on port and cargo security matters and
on the detection of smuggled contra-
band. Saudi Customs established an
Inspection Support Department to
coordinate these efforts.

One major activity is the Detector
Dog Program for which U.S. Customs
has trained over 95 canine teams. The
program is currently operating at seven
ports in the Kingdom.

Since its implementation in March
1983, this program has been credited
with over 400 seizures of a variety of
drugs and weapons.

The other main activity is inspection
technology. This has included the im-
plementation of a security seals pro-
gram for in-transit cargo, installation of
50 parcel X-ray machines at ports of
entry, the introduction of a number of
high-tech devices for the detection of
contraband and the sharing of smug-
gling intelligence between U.S. and
Saudi Arabian Customs.

AH Customs grieved when CPO Glenn Miles
was slain in the line of duty. Agents from
the Office of Internal Affairs conducted an
exhaustive investigation that led to iden-
tification of three suspects in the Miles
shooting. The three are currently being held
by Mexican authorities. In this photograph

Securitf

The fundamental mission of the Of-
fice of Security is to preserve the in-
tegrity of the Customs Service. To that
end, 334 criminal and serious integrity
investigations were conducted in FY
1986. As a result of these investiga-
tions, there were 54 arrests for bribery,
assault, theft, smuggling, etc. Of those
arrested, 37 were employees.

These investigations also resulted in
41 serious administrative personnel ac-
tions and revealed several procedural
deficiencies which were reported to
management for corrective action.

The office was reorganized this past
year to consolidate the oversight of all
physical and information security f unc-

Specia! Agent Breck Ellis (left) examines
the death site in Arizona with Assistant
Commissioner William Green. Ellis is
holding a tracking stick used for tracking
the assailants from the shooting scene on
the Tohono O'odham Indian Reservation to
Mexico.

tions within the Service. Among
priorities in this area was the enhance-
ment of facility security at international
airports and along the southwest
border.

Executive protection programs were
implemented to provide security
should the need arise. An audio-
countermeasures program was devel-
oped to increase the security of our
communications.

The administration of the personnel
security program falls under the direc-
tion of this office. The staff oversees
employee and contractor background
investigations and is responsible for
the issuance of security clearances.
During the past year significant reduc-
tions were made in the number and

32

type of National Security clearances
and those records were automated.

The Office of Security coordinates
the Customs-wide polygraph program.
Special agent examiners have been
trained, and the program is now a
viable entity providing support not only
to Customs, but to other Federal, state
and local agencies.

The Internal Audit Program provides
Customs management with indepen-
dent and objective evaluations of the
operation of Customs programs and
activities.

During FY 1986, 93 audit reports
containing recommendations for im-
provements in various Customs areas
were issued. For example, a national
audit of EDP equipment accountability
disclosed that significant improve-
ments are needed to establish proper
control over Customs $22 million in-
ventory of EDP equipment.

A national audit of the ex-
change/sale program identified ad-
ditional exchange/sale proceeds total-
ing $508,000 which were subsequently
used to timely acquire replacement
property.

National audit of Customs im-
plementation of the Currency and
Foreign Transactions Reporting Act
disclosed opportunities for Customs to
increase the effectiveness of indepth
financial investigations. Corrective ac-
tions taken by Customs managers in
response to recommendations made in
audit reports have resulted in more ef-
fective and efficient operations.

The Office of Management Inspec-
tion evaluates the overall management
of Customs activities and performs
evaluations of specific programs. Now
located in Indianapolis, the office com-
pleted evaluations of Airport Security
and Intelligence during FY 1986.

Centralization of administration was
completed within less than one year
and will provide an annual recurring
savings of approximately 265 staff
years and over $5.5 million. The sav-
ings and full-time equivalent (FTE)
reductions were reallocated from ad-
ministration to direct operational and
enforcement programs.

Most support services are now pro-
vided by the National Finance Center
and the National Logistics Center in In-
dianapolis. The centers are located in a
new facility that was constructed to
meet Customs needs. The central of-
fices for the personnel, management
analysis and data processing functions
are located in Washington, D.C.

Administrative centralization has
allowed Customs to take full advan-
tage of technology advancement such
as automation of requests for person-
nel services and the direct field input of
time and attendance. Customs officials
in the field can now transmit informa-
tion and requests to headquarters elec-
tronically, without paper and mail
delays.

The transition to an operational Na-
tional Personnel Office was executed
with an implementation plan that
emphasized high payoff work
simplification and automation in-
itiatives. These initiatives, designed to
improve consistency and streamline
delivery of personnel services, included
development of standardized position
descriptions and crediting plans for all
mainstream occupations.

Standard turnaround times have
been established to insure timely serv-
ice to all headquarters and field offices.
Backlogs carried over from the regional
offices have been cleared.

Customs success in centralizing ad-
ministrative services owes much to its
effective use of computer technology.
Ten powerful new data bases installed
this year are providing significantly bet-
ter services at lower costs.

New personnel systems are making
it possible for a central staff to keep
abreast of applicants, vacancies, pro-
spective candidates, employee sugges-
tions and requests for personnel action
for the entire Service. By reducing
paperwork, improving work scheduling
and letting users see the status of their
requests, the new systems are helping
Customs to work more productively.

A new procurement system called
Customs Logistics Automated System
(CLAS) prints purchase orders and
amendments, provides inquiries and
management reports and sends infor-
mation daily to CAMIS, our com-
prehensive accounting system.

With one system talking smoothly to
another, Customs has ended redun-
dant keying of data and has improved
the timeliness and accuracy of budget
information.

Customs now has an up-to-date
data base including every building we
occupy as a result of a new system
called the Customs Automated Space
Inventory System (CASIS).

The system helps the logistics staff
at Indianapolis manage leases, main-
tenance, renovation projects and
space assignments within each facility
throughout the Service.

State-of-the-art computer tech-
niques have also improved the ad-
ministration of our Customs labora-
tories.

This year Customs replaced an old
computer system which could support
only one lab at a time with a fast,

CUSTOMS USA

33

reliable, centralized system using the
IBM-3084.

Now each Customs laboratory
regularly shares lab results and other
information in a matter of minutes.
Headquarters managers can prepare
reports and make inquiries about any
or all labs.

Logistics

Seized Property The Customs
Service awarded a contract to Nor-
throp Worldwide Aircraft Services,
Inc., for the custody, transportation,
care, safeguarding, sale and other
disposition of property seized by or
forfeited to the Customs Service.

With a potential value of $44 million
over four years, this is the largest such
contract ever awarded by the Customs
Service and possibly the Federal
Government. It is intended to provide
for efficient and effective manage-
ment, care and disposition of seized,
forfeited or voluntarily abandoned
property through the use of a nation-
wide contractor.

In the past, this property might have
remained in Customs custody for as
long as 36 months, causing storage
and maintenance problems for Cus-
toms personnel. As a result, the resale
value of the property often declined
due to deterioration during the storage
period.

The Northrop contract was opera-
tional for eight months in FY 1986.
During that time a total of $88,572, 176,
in assets were processed with an end-
ing inventory of $62,217,295 worth of
property in storage.

Forfeiture Fund Congress estab-
lished the Customs Forfeiture Fund for
the deposit of net receipts from seized
and forfeited merchandise and curren-
cy. The funds are used to reimburse
the salaries and expenses appropria-
tion for excess costs as well as to outfit
seized conveyances (aircraft, vessels
and vehicles) for use in Customs law
enforcement efforts.

Customs was appropriated $6 million
for this fund in FY 1985 and $8 million
in FY 1986. It is anticipated that the
fund will remain at $8 million in FY
1987.

Collecting the new user fees Customs in-
spectors (CI's) around the nation began
collecting processing fees on July 7, 1986.
At the Erie Basin Marine in Buffalo, Super-
visory Cl John Machniak accepted the pro-
rated annual fee from the master of a

38-foot private vessel just in from Canada.
In Champlain, N.Y., a trucker entered from
Canada and purchased an annual decal
from CS Pat Coultry. The pilot of a private
aircraft landing in Buffalo told Cl Richard
Bartlett he had paid his annual processing
fee.

Consolidated Data Telecom-
munications Network (COW)- Cur-
rently, the U.S. Customs Service has
two independent telecommunications
networks. One supports the Treasury
Enforcement Communications System
(TECS) and runs on the Burroughs
B7900 at the San Diego Data Center.

The other supports Customs com-
mercial and administrative systems and
runs on the IBM 3084 located at the
Franconia Data Center. We are com-
bining these two networks into one.

During FY 1985, a contract was
awarded to the Computer Sciences
Corporation (CSC) for the design and
development of the new network. This
contract also gave CSC the operational
responsibility of the network.

Total evaluated cost of this contract
is $48.5 million. Treasury expansion of
the project will be valued at $282
million. Implementation of the total
Consolidated Data Network for Cus-
toms will be accomplished within two
years of the contract award.

Improvements to be derived from
this network will include: reduced
costs, capability to handle expansion
and growth needs, improved reliability
and diagnosis, as well as minimum
redundancy and improved security for
sensitive information transmitted by
our ADP and data communications
systems.

Treasury Enforcement Com-
munications System (TECS) The
Treasury Enforcement Communica-
tions System (TECS) continued to pro-
vide Customs and other Federal, state
and local law enforcement agencies
with improved levels of service. An in-
terface was implemented between the
TECS and ACS computer systems,
allowing a TECS query to be per-
formed from an ACS terminal.

Significant improvements were
made in the exchange of data between
Customs and the El Paso Information
Center (EPIC), especially in the area of
private aircraft information. New
systems developed included: the Air-
craft Tracking System, the Automated
Target Flight Connection System and
the Multiple Border Crossers System.

Significant progress was made dur-
ing the past year on TECS II, the
redesigned replacement for current
TECS. A major contract was awarded
for the design and development of
TECS IS. Preliminary design was subse-
quently completed, and the detailed
design and programming are now in
progress.

Under the Consolidated Omnibus
Budget Reconciliation Act, Congress
provided that the Secretary of the
Treasury shall charge and collect
specific fees for certain Customs serv-
ices.

Among the services for which a fee
is specified are: (1) arrival of each
passenger aboard a commercial vessel
or aircraft, (2) arrival of a commercial
vessel of 100 net tons or more, (3) ar-
rival of commercial trucks and railroad
cars, (4) arrival of a private vessel or
aircraft, (5) processing of dutiable mail
parcels and (6) Customs Brokers
licenses.

After preparing detailed procedures
and regulations for assessing and
collecting the fees, the law was
implemented at all Customs ports on
July 7.

Personnel

Drug Screening Program The

Customs Drug Screening Program re-
quires drug screening as a condition of
employment or placement into speci-
fied positions. The program was im-
plemented on June 25 for tentative
selections of candidates from outside
the Service for positions covered by
the program.

Following impact and implementa-
tion bargaining with the union, the pro-
gram was expanded on August 11 to
include tentative selection of any can-
didate, including Customs employees,
for positions covered by the program.
Drug screening is initiated as part of
the recruitment and staffing process.

Employee Trauma Program
During 1986 the Office of Human
Resources designed and tested an
Employee Trauma Program to assist

enforcement officers who suffered
traumatic incidents on the job. (e.g.,
shootings).

A cadre of Customs employees, as
well as a police psychologist, were
dispatched to provide support and
technical assistance to the survivors
(both family members and coworkers
who witnessed the events). This pro-
fessional response received very
positive feedback from the involved
employees.

The U.S. Customs Service Equal
Opportunity (EO) Program exists to en-
sure equality of opportunity for all em-
ployees and applicants regardless of
race, sex, color, national origin, age,
religion or handicap (mental or
physical).

The program provides for a system
of processing discrimination com-
plaints which encourages informal
resolution of complaints and assures
prompt and unbiased settlement of
cases.

In an effort to reduce the processing
time of discrimination complaints, the
Customs Service has entered into a
contract for investigative services. As a
result, the processing time has
decreased and overall operations have
improved.

To enhance Customs image as an
equal employment opportunity agen-
cy, the EO office supported many com-
munity activities, including:

The National Organization of
Black Law Enforcement Executives
(NOBLE) Conference

Customs Explorers Post 1989

The Federal Women's Interagency
Board

The Asian American/ Pacific Is-
lander Heritage Week Observance and

The Martin Luther King, Jr.
Federal Holiday Planning Commission.

As part of a continuous effort to
identify strengths and weaknesses of
the EO program servicewide, on-site
evaluations of four regional EO pro-
grams (i.e., Southeast, South Central,
New York and Northeast Regions)
were conducted. A report of the find-
ings and recommendations is being
prepared.

CUSTOMS USA

35

j J '^ * i A il c< Fiscal Year

1982

1983

1984

1985

1986

{ '- vT-T ~~, s --*r. n'rv- Formal Entries:

1-. c ""* 'i~:-i *3>^~s Consumption free

1,419,753

3,147,794
2,172
654
35,965

97,137

1,617,990

3,565,234
2,216
516
38,938

88,890

1,881,941

4,402,394
1,437
323
39,154

95,337

1,912,131

4,742,911
1,172
225
40,824

92,930

2,036,790

5,076,278
1,204
223
42,883

93,237

Consumption
dutiable
Vessel repair
Appraisement
Drawback
Warehouse &
rewarehouse

Total formal
entries

4,703,475

5,313,784

6,420,586

6,822,601

7,250,615 1

Other entries:

Warehouse
withdrawals 2
Mail
Informal
Declarations
Free
Dutiable

309,280
968,949
2,859,194

15,680,665
1,589,372

328,118
986,885
3,142,540

16,623,464
635,972

270,042
997,630
3,472,601

18,862,543
549,181

368,418
729,553
3,680,456

19,979,443
715,653

442,398
583,022
4,235,341

20,281,165
582,534

Total other entries

21,407,460

21,716,979

23,881,955

25,473,563

26,124,460

Total Entries of
Merchandise

26,110,935

27,030,763

30,302,541

32,296,164

33,375,075

1 Total includes 41,966 Government entries.
2 This includes dutiable withdrawals only.

ScB2J3E a ces of C^stssras Fiscal Year 1982

1983

1984

1985

1986

Appropriated
Other sources 1
Return per $1
Appropriated

$ 527,173,000
$ 69,862,000

$18.94

$ 571,317,000
$ 69,119,000

$17.13

$ 599,481,000
$ 68,483,000

$20.92

$ 669,734,000
$ 72,605,000

$19.76

$717,000,000
$ 80,013,400

$20.55

Reimbursements for overtime and for services rendered to other

Federal agencies, private organizations and

individuals.

Fiscal Year

1982

1983

1984

1985

1986

by feegiOT
tid Northeast

Boston
Bridgeport
Buffalo
Ogdensburg
Portland, Maine
Providence
St. Albans
Baltimore
Philadelphia

$ 320,470,419
57,402,081
167,745,671
105,463,902
52,866,741
40,284,941
24,546,256
280,151,707
313,825,093

$ 361,644,231
49,969,753
181,328,714
111,792,205
40,067,615
40,943,252
24,829,153
274,094,697
313,614,262

$ 409,422,100
58,108,749
253,609,444
131,255,260
34,846,810
43,541,070
32,978,893
346,949,318
387,550,900

$433,790,878
58,267,367
260,005,586
126,090,646
36,981,461
34,342,706
35,897,775
388,144,421
420,913,462

$496,663,548
53,609,229
261,319,027
123,188,048
41,844,654
47,785,323
38,225,388
477,417,395
401,920,029

Total Region

$1,362,756,811

$1,398,283,882

$ 1,698,262,544

$1,794,434,302

$1,941,972,641

36

The U.S. Customs
Service collected
$96,51 3,742 for the

Puerto Rico special
fund for fiscal 1986
and $5,920,251 for
the Virgin Islands
deposit funds.

Fiscal Year

1982

1983

19S4

1S85

1986

IMew York

New York
Newark
JFK Airport

$1,601,667,528
167,246,456
938,641,375

$1,544,822,053
199,690,004
1,008,651,549

$1,796,617,718
241,495,074
1,326,193,386

$1,756,954,061
253,096,332
1,380,126,356

$1,908,589,636
344,241,171
1,552,589,516

Total Region

$2,707,555,889

$2,753,163,606

$ 3,364,306,178

$3,390,176,749

$3,805,420,323

Southeast

Charleston
Miami
San Juan
St. Thomas
Savannah
Tampa
Wilmington
Norfolk
Washington D.C.

$142,732,097
139,896,819
796,816
31
233,762,835
300,662,002
90,038,216
150,244,311
15,066,749

$148,462,595
202,790,084
889,024

220,700,043
271,138,358
87,407,240
157,091,631
14,994,810

$202,910,948
188,272,740
817,030

290,621,272
352,237,076
114,223,372
170,471,188
18,490,284

$203,167,254
204,940,622
806,021
28,866
314,356,829
395,553,265
129,551,912
189,710,532
21,726,718

$275,303,495
215,691,949
1,673,070
23,355
339,432,137
435,565,799
133,362,824
216,294,385
43,799,733

Total Region

$1,063,199,876

$1,113,473,785

$ 1,338,043,910

$1,459,842,019

$1,661,146,747

South Central

Mobile
New Orleans

$ 35,812,486
309,173,066

$ 38,745,853
243,647,465

$ 53,952,850
321,263,125

$ 54,203,440
338,818,513

$ 39,196,836
330,277,015

Total Region

$ 344.985.552

$ 282,393,318

$ 375,215.975

$ 393,021,953

$ 369,473,851

Southwest

Dallas/ Fort Worth
El Paso
Houston
Laredo
Port Arthur
Nogales

$ 81,507,833
74,419,851
612,707,067
91,203,452
18,557,175
56,017,716

$ 75,274,916
41 ,962,086
318,715,171
101,501,399
10,802,411
55,490,761

$ 107,845,210
54,621,603
407,060,075
134,574,321
11,121,569
65,364,927

$ 118,067,385
61,964,160
434,749,976
138,909,286
7,469,930
72,806,607

$ 164,343,648
73,913,124
415,390,527
165,231,572
12,125,699
75,853,578

Total Region

$ 934,413,394

$ 603,746,744

$ 780,587,705

$ 833,967,344

$ 906,858,148

Pacific

Los Angeles
San Diego
Anchorage
Honolulu
Portland, Oregon
San Francisco
Seattle

$1,471,143,348
42,128,363
14,128,211
45,617,254
154,105,094
502,221,090
406,803,779

$1,504,517,493
43,139,509
11,012,355
45,545,752
136,585,838
520,130,815
393,426,401

$ 2,108,083,947
56,847,968
9,169,807
52,859,734
180,306,336
727,628,216
558,904,644

$ 2,341,023,009
61,098,111
10,621,186
46,971,242
201,031,546
739,469,626
574,293,730

$ 2,729,287,123
70,314,801
15,297,969
48,587,547
235,282,570
765,966,576
603,042,670

Total Region

$2,654,147,139

$2,654,358,163

$ 3,693,800,652

$ 3,974,508,450

$ 4,467,779,256

North Central

Chicago
Cleveland
Detroit
Duluth
Milwaukee
Minneapolis
Pembina
St. Louis
Great Falls

$ 299,510,842
115,228,904
348,170,757
7,393,197
23,580,784
33,737,505
12,183,766
54,584,975
19,893,600

$ 314,799,392
123,191,795
356,679,121
10,352,195
27,005,647
35,917,872
14,065,605
58,243,537
39,284,689

$ 445,201,971
167,641,673
430,538,218
13,750,514
32,983,701
50,044,215
19,436,884
79,277,688
52,307,868

$ 508,497,187
189,405,125
411,305,858
20,106,498
32,160,711
53,255,809
30,616,457
86,013,582
59,857,202

$ 554,800,438
241,768,263
476,015,812
24,963,963
31,878,091
58,196,407
29,670,863
94,832,814
66,414,149

Total Region

$ 914,284,330

$ 979,539,853

$ 1,291,182,732

$ 1,391,218,429

$ 1,578,540,800

TOTAL ALL
REGIONS

$9,981,342,991

$9,784,959,351

$12,541,399,696

$13,237,169,246

$14,731,191,766

CUSTOMS USA

37

'j ES2

1933

1984

1985

1986

;:::"::. ": ', wduz

Consumption

entries

$8,658,300,639

$8,427,526,099

$11,149,031,921

$11,755,136,632

$13,193,066,737

"The new User Fee Account category Warehouse

was established by Congress in July withdrawals

531,429,349

496,602,989

504,028,346

533,787,351

411,189,214

1S86> Mail entries

17,263,630

17,642,134

15,854,280

16,518,402

16,625,204

Passenger baggage

entries

17,120,815

19,000,063

24,726,009

33,201,048

30,117,710

Crew member

baggage entries

1,001,570

1,088,082

1,052,392

1,346,103

936,791

Military baggage

entries

327,380

290,043

227,909

689,285

224,594

Informal entries

19,069,055

20,901,312

20,388,271

42,780,538

34,908,566

Appraisement

entries

392,888

167,839

93,246

117,062

159,133

Vessel repair

entries

11,958,332

9,856,261

9,816,598

5,398,984

8,617,922

Other duties

20,901,604

66,414,074

59,575,185

114,658,248

130,028,502

Total Duties

$9,277,765,262

$9,059,488,896

$11,784,794,157

$12,503,633,653

$13,825,874,373

Miscellaneous

Violation of

Customs laws

$ 25,601,339

$ 43,227,188

$ 46,421,682

$ 45,769,010

$49,421,103

Marine inspection

and navigational

services

2,259

11,622

2,698

2,114

1,450

Testing, inspecting

and grading

79,801

61,810

103,722

108,979

102,132

Miscellaneous

taxes

14,281,865

13,124,575

15,058,086

15,527,171

15,851,058

Fees

661

37,232

16,687

40,288

32,535

User Fee Account

N/A

N/A

N/A

N/A

12,168,289*

Unclaimed funds

2,608,605

702,985

118,331

374,401

3,052,264

Recoveries

116,522

18,450

16,088

29,190

9,597

All other Customs

receipts

1,216,470

6,731,852

1,139,506

1,609,220

4,086,486

Total

Miscellaneous

$ 43,907,522

$ 63,915,714

$ 62,876,800

$ 63,460,373

$84,724,914

Internal

Revenue

Taxes

$ 659,670,207

$ 661,554,740

$ 693,728,739

$ 670,075,220

$820,592,479

TOTAL

COLLECTIONS

$9,981,342,991

$9,784,959,351

$12,541,399,696

$13,237,169,246

$14,731,191,766

38

CARRIERS

Fiscal Year

1982

1983

1984

1985

1986

BY

REGION

Northeast

14,380,402

14,872,013

14,884,415

15,507,447

15,877,018

New York

54,143

54,598

59,270

59,088

74,710

Southeast

262,651

163,341

162,944

173,202

174,727

South Central

20,312

17,156

15,870

15,668

14,718

Southwest

43,462,904

40,347,200

39,997,932

39,223,891

41,525,456

Pacific

23,490,868

23,883,678

24,236,713

23,878,980

26,964,173

North Centra!

9,813,659

10,403,709

10,403,709

10,884,014

11,180,738

Total

91,484,939

89,582,004

89,760,853

89,838,735

95,811,540

BY TYPE OF

CARRIER

1982

1983

1984

1985

1986

Commercial vessels

direct from

foreign ports

50,515

44,751

45,310

47,686

49,735

Commercial vessels

via other U.S.

ports 1

(34,465)

(32,802)

(34,319)

(33,853)

(34,417)

Ferries

67,519

71,700

81,037

55,965

46,711

Private vessels

51,466

58,058

60,560

61,600

60,095

Military vessels

2,209

1,113

1,033

1,068

1,621

Other vessels

3,203

3,756

3,586

3,398

4,380

Preclearance

commercial

aircraft

N/A

N/A

N/A

87,513

88,441

Commercial aircraft

direct from

foreign ports

207,041

210,217

225,247

240,130

421,380

Commercial aircraft

via other U.S.

ports 1

(20,913)

(13,180)

(13,451)

(21,947)

(16,613)

Military aircraft

17,372

17,749

16,290

14,812

23,909

Private aircraft

79,505

75,820

65,367

62,332

132,011

Other aircraft

N/A

N/A

N/A

N/A

N/A

Aircraft not

requiring entry

76,711

72,744

77,649

79,713

87,341

Trucks 2

3,575,781

3,599,240

4,087,669

4,200,635

6,297,672

Buses

268,800

251,978

253,202

249,178

269,491

All other ground

vehicles {in-

cluding POV's) 3

86,818,224

85,019,131

84,697,856

84,545,526

88,327,633

Trains

40,734

39,964

38,171

37,511

37,431

Total

91,314,458

89,509,203

84,736,027

84,832,215

94,932,227

PERSONS

BY REGION

1982

1983

1984

1985

1986

Northeast

42,052,723

42,800,459

42,917,851

43,388,404

44,905,532

New York

7,460 r 217

7,967,053

9,015,799

9,195,014

8,910,497

Southeast

9,316,884

7,206,914

7,150,711

7,801,669

8,346,813

South Central

200789

195,893

163,352

165,175

134,735

Southwest

131,316,096

116,597,948

116,553,179

116,540,702

119,324,842

Pacific

81,078,573

79,942,356

82,156,387

81,889,191

88,320,555

North Central

28,600,054

29,102,916

29,979,346

30,541,296

31,552,630

Total

300,025,336

283,813,539

287,936,625

289,521,451

301,495,604

CUSTOMS USA

39

1984

2,454,650

2,477,610

3,093,296

1986

3,166,372

Ferries

617,986

947,296

963,633

796,008

863,645

Commercial planes
Precleared planes
Military planes
Private planes

20,647,317

6,582,239

708,459

483,297

21,081,616

6,251,361

718,556

467,525

23,385,246

6,618,198

723,776

445,000

24,591,857

6,722,065

723,200

430,594

23,966,338

6,908,247

715,409

424,918

Ground vehicles and
on foot

266,448,281

251,893,911

253,323,162

253,164,431

265,450,675

Note: The above statistics exclude Puerto Rico and U.S. Virgin Islands.

Total

298,038,691

283,804,915

287,936,625

289,521,451

301,495,604

f oi Fiscal Year

of
by

1982

1983

1984

1985

1986

Prohibited non-
narcotic articles

Number of seizures

23,463

25,870

20,225

15,849

12,785

Vehicles

Number of seizures
Domestic value

5,951
$ 35,935,720

9,481
$ 63,911,945 $

9,347
62,953,753

9,323
$ 80,666,094

8,911
74,597,069

Aircraft

Number of seizures
Domestic value

206
$ 34,742,505

203
$ 19,104,322 $

157
50,327,176

145
$ 150,448,420

123
17,414,450

Vessels

Number of seizures
Domestic value

500
$ 44,461,893

405
$ 33,209,335 $

558
49,255,944

524
$ 41,226,619

292
14,423,560

Monetary
instruments

Number of seizures
Domestic value

1,802
$ 32,757,121

2,066
$ 50,173,822 $

2,088
67,734,486

1,114
$ 95,838,434

1,370
121,535,526

General
merchandise

Number of seizures
Domestic value

27,132
$ 92,015,268

36,972
$ 142,823,959 $

33,334
348,796,395

32,679
$ 277,339,278

30,489
237,849,607

Total Seizures

59,054

74,997

65,709

59,634

53,970

Total Domestic
Value

$ 239,912,507

$ 309,223,383 $

579,067,754

$ 645,518,845

465,820,212

Black History Month at Customs head-
quarters featured an address by Martin
Luther King, III, son of the NobeS Peace
Prize winner.

Fiscal Year

1982

1983

1984

1985

1986

Heroin

Number of seizures
Quantity (in Ibs.)
Value

168
289.9
$ 174,169,891

285
593.6
$ 342,257,888

396
664.3
$ 383,022,094

426
784.6
$ 452,384,668

406
692.4
$ 399,223,992

Cocaine

Number of seizures
Quantity (in Ibs.)
Value

1,364
11,149.5
$3,462,205,465

1,731
19,601.5
$5,339,448,600

1,625
27,525.8
$ 7,498,027,920

2,164
50,506.4
$13,757,943,360

2,577
52,520.9
$14,306,693,160

Hashish

Number of
seizures
Quantity (in Ibs.)
Value

2,610
58,276.6
$ 126,110,562

1,829
2,209.8
$ 4,032,885

1,530
42,389.5
$ 77,360,838

1,948
22,970.0
$ -41,920,250

2,158
17,555.4
$ 32,038,605

Marijuana

Number of
seizures
Quantity (in Ibs.)
Value

11,947
3,958,870.9
$3,115,631,398

12,101
2,732,974.5
$2,107,123,340

12,304
3,274,927.2
$ 2,524,968,871

12,002
2,389,704.1
$ 1,842,461,861

10,377
2,211,068.1
$ 1,704,733,505

Opium

Number of seizures
Quantity (in Ibs.)
Value

265
197.0
N/A

103
78.9
N/A

429
258.0

N/A

1,118
505.0
N/A

807
321.2

N/A

Morphine

Number of
seizures
Quantity (in Ibs.)
Value

165
17.8
N/A

199
60.0
N/A

156
12.6
N/A

10
3.3

N/A

- 8
0.6

N/A

Other Drugs, Barbiturates and LSD

Number of
seizures
Quantity (in units)
Value

3,017
2,339,360
$ 11,813,768

2,862
5,592,669
$ 23,656,990

2,627
6,819,717
$ 28,847,403

2,179
22,540,573
$ 95,346,624

2,680
1,424,682
$ 6,026,405

Total Seizures

19,536

19,110

19,067

15,280

19,013

Total Value

$6,889,931,084

$7,816,519,703

$10,512,227,126

$16,190,056,763

$16,448,715,667

The new building in the background houses
the National Finance and National Logistics
Centers of the U.S. Customs Service,
located in Indianapolis. Indiana Senator

Richard 6. Lugar, being welcomed by the
Commissioner at the dedication ceremony,
applauded Customs achievements in ad-
ministrative centralization.

The new container crane delivered to Sea-
Land represents commercial expansion and
a concomitant increase in workload for
Chief Inspector Art Henning of Tacorna and

fellow Customs officers nationwide.

Checking for possible textile fraud, C! Carla
Brooks of Baltimore weighs part of a ship-
ment.