PIGGYBACKING
Members will recall an investigation published late last year by The Australian that uncovered widespread "piggybacking" — a tactic where organised crime groups fraudulently use the identities of legitimate businesses to import tonnes of illicit tobacco, costing the government billions in lost revenue.
Freight & Trade Alliance (FTA) Director Paul Zalai was quoted "Customs brokers are a highly regulated profession and overwhelmingly operate with the highest integrity. The same applies to customs officers, who face rigorous integrity checks to ensure accountability."
"While no system is completely immune from corruption, I would stress that the bigger issue is not individual misconduct, but the outdated technology that industry and the Australian Border Force are forced to rely on. We are trying to combat 21st-century organised crime with 20-year-old systems. That's where the real vulnerability lies."
SOURCE: How criminal gangs are 'piggybacking' on legitimate businesses to flood Australia with illegal tobacco [PAYWALL FOR FULL ARTICLE]
FTA MEMBER SUPPORTTo support members in managing due diligence obligations, FTA has implemented a Three Pillar Approach: - Advocacy
- Informed Compliance
- Technology
ADVOCACY
Since our 2023 position paper to the Simplified Trade System (STS), FTA has lodged multiple submissions highlighting risks to border integrity, with a specific focus on illegal tobacco importations.
Key engagement milestones include:
4 February 2026 - Canberra meeting with Senators
20 February 2026 - Select Committee on Productivity in Australia
16 March 2026 - Australian Border Force (ABF) response to FTA
26 March 2026 - Senate Legal and Constitutional Affairs Committee (Illegal Tobacco Crisis in Australia)A consistent theme emerging from these engagements has been the need to implement a direct payment model for duty and GST, whereby cargo owners provide banking details directly to the ABF, removing the requirement for customs brokers to make payments on behalf of importers. Following extensive member feedback, FTA recommends that this approach be implemented in the sea cargo environment only.
The model is intended to reduce identity theft, prevent 'piggyback' illegal imports, improve transparency for cargo owners, safeguard community interests, and enhance productivity across Australia's trade system, without requiring changes to the Integrated Cargo System (ICS). INFORMED COMPLIANCEFTA recommended that the ABF develop a fact sheet and a Continuing Professional Development (CPD) training module outlining minimum due diligence requirements and appropriate actions when dealing with identified 'piggyback' consignments. This recommendation has been partially implemented through the inclusion of relevant content in the mandatory ABF hosted CPD module for 2025/2026.
Complementing this approach, FTA will recap key learning outcomes and provide further detail on our Three Pillar Approach at upcoming CPD Border Compliance Program events (see below).
In addition, FTA has prepared a Customs Broker Toolbox. The Authority to Lodge an Import Declaration resource provides important clarification on the requirement for valid authority when lodging import declarations. While a formal Letter of Authority is not prescribed under legislation, the guidance reinforces that authority must be genuine and demonstrable.
Using a practical scenario, it highlights the risks of relying on MBOL/HBOL relationships alone and outlines best practice steps to mitigate compliance and commercial risk - further detail available HERE. TECHNOLOGY
Responding directly to member demand for a practical, fit-for-purpose solution, FTA has partnered with CreditProtect to develop a new technology offering. The solution is currently in a pilot phase and is inviting additional participants to trial and help refine its capability.
CreditProtect and FTA representatives will demonstrate the platform at the below CPD events explaining how it can support improved compliance outcomes while streamlining risk management processes. |