Corrupt customs officials have stolen – and possibly sold – seized goods earmarked for destruction, exposing ”extremely haphazard” governance within the agency charged with protecting Australia’s borders. Files from Customs’ internal affairs department also suggest the organisation had no policy to ensure its favoured gun dealers were actually licensed to sell the firearms it had ordered.

Fairfax has obtained the files after a two-year freedom of information battle. The documents reveal an agency overwhelmed by the threat of organised crime, but they also expose several serious management failures in the organisation’s senior ranks.

In the middle of 2008, for example, a licensed weapons dealer threatened to sue Customs, alleging its Weapons and Strategic Goods group, which armed front-line officers with items such as Glock handguns and capsicum spray, was buying weapons ”from a person not authorised to deal in such weapon types”. Investigators did not find any ”discrepancies”, but along the way they made a startling discovery: ”No specific checks [are] conducted regarding appropriate licensing when purchasing weapons.”

On Saturday, Fairfax Media reported that internal inquiries into Customs staff led to adverse findings in about two-thirds of 700 cases between 2007 and 2010. In one case, an officer was caught in June 2009 removing cigarettes marked for destruction from a detained goods facility. He was fined $1500, but the whistleblower had told investigators ”others may be involved and quantities could be much higher”. Internal affairs went on to identify the problem as a ”systemic issue”.

In Queensland about the same time, an audit of one of Customs’ Detained Goods Management stores ”revealed a stock shortage of 1200 sticks of tobacco from the February 2008 DGM stocktake”. A number of Customs officers working in the cargo group were identified by the investigation, the ”goods [were] established as unaccounted for”, and questions were raised about why it was that ”half of staff” in the division had access to the DGM. ”No accountability and controls in place,” Internal Affairs noted in its report. ”Procedures in place at the DGM … were extremely haphazard … poor supervisory and fraudulent records identified.”

The final reports recommended new standard operating protocols for all Customs storage facilities. Several officers may have faced disciplinary proceedings as a result of the inquiry, the files suggest.

At one point, Customs investigators feared poor control of seized goods extended to far more dangerous goods, after a February 2009 audit of the seized goods facility in Queensland reported that more than 16,000 rounds of ammunition ”with a variety of associated equipment” had gone missing. But Customs now says this was just another case of poor management, after major accounting errors were identified in the audit.

The files also raise serious questions about financial controls within the organisation. Customs chief executive Mike Pezzullo (no relation to me) said on Saturday he was planning to overhaul the organisation’s internal affairs unit. Source: The Age (Australia)