Solving the Customs’ dilemma

The responsibilities borne by the Federal Customs Department should not be taken lightly. First of all, it is up to the Customs Department to determine whether or not goods get cleared for import or export. The more goods they check, the greater the probability of discovering illegal practices, whether it is of an economic nature or related to terrorist activities. On the other hand: checking the goods slows down trade flowing in both directions and is expensive. The question is how to solve this dilemma.

Stephan Legein is General Adviser at the Customs Department of The Federal Public Service Finance in Belgium. He is leading the department which is responsible for target management, risk management and enforcement. Regulations for risk management are actually included in the European Community Customs Legislation. According to this legislation, customs controls in European member states have to be based primarily on risk analysis. The information which is needed for a proper risk analysis has to be gathered using electronic techniques for data computing. Simply put, the decision to determine which goods will be checked and which will not, is taken by software that uses risk analysis to determine the selection.

Reducing the risk of fraud and human error

In the past, a customs officer made the decision regarding which goods to inspect and then personally performed the inspection. This is certainly not a bad thing, as long as the inspection is carried out with due diligence and according to proper practice and statutory requirements. In order to reduce the risk of fraud, the World Customs Organization recommends that the selection of goods to be checked and the actual check itself be performed by two different customs officers. This procedure will indeed help reduce the risk of corruption. But there is another problem.

“There is a set of instructions for each of the various types of goods that passes through the customs system. These instructions have to be used by the customs officers in the field to help them decide whether or not it is necessary to inspect the goods. The principal problem is that the number of instructions is very extensive, and is still growing. For customs officers it is virtually impossible to determine the correct set of instructions that they should apply for each declared item in a short span of time. A software-driven system however, doesn’t forget anything. Ever. And it determines which of the declared items need to be checked in a split second,” states Mr. Legein.

New software-based solution within three months

The Customs Department implemented software in 2010, based on the standard software used within the Federal Public Service Finance at that time. Subsequently however, the Federal Public Service Finance decided to opt for SAS software. This meant the Customs Department’s fraud system needed to be changed as well. “By the time the budget was cleared and the SAS consultant we wanted to use was available, there wasn’t much time left since the license for our previous software was about to expire. So we were very grateful when it turned out that our SAS consultant was able to get the SAS system up and running within three months.”

One thousand smart selection criteria

“Today, we use a very powerful and fully automated SAS software fraud detection environment, which uses almost one thousand smart selection criteria to decide whether the goods should be inspected or not. These criteria are based on the risk analysis of a set of properties, such as the type of goods, and country of origin, among many others. The SAS solution is able to check six declaration requests per second. This, of course, saves an enormous amount of time for everyone involved,” summarizes Mr. Legein.

The SAS system is currently used to assist 1,500 customs officers, which are spread out across the nation, in controlling risk-based selections. Meanwhile, a team of six people is taking care of the selection criteria that are used in the software and is performing day-to-day maintenance. They also check on the extent to which the selection criteria used yield results.

The quest for historical data

“We are using SAS today with great success. Nevertheless, we hope to add more functions to the system in the near future. At the moment, the system is evaluating each item by itself, not taking into account decisions that were made in the past regarding similar declaration requests from the same company, shipper or recipient. So if a similar declaration request from the same company has been selected for inspection during the last 24 hours, it probably doesn’t need to be checked again.

We hope to add such historical data in the selection criteria, and increase the power of the fraud detection solution. In short we expect our system to become even more discriminating and intelligent.”

“We are strongly motivated to automate even more tasks in the future than we do today. We are confident that we can reduce the number of illegal goods crossing our border and thereby create fairer and safer trade. Let’s just say that we want digital to become our new normal.”