Lahore: According to the latest official Press Release, the Federal Board of Revenue (FBR) has taken disciplinary and criminal action against its own officers found to be involved in the fraudulent legalization of smuggled vehicles.
Auction Module Introduced to Curb Fraud
In August 2021, FBR introduced an “Auction Module” in its WeBOC system to tackle irregularities in the registration of auctioned smuggled vehicles.
This digital mechanism enabled Motor Registration Authorities (MRAs) to verify auction details online before registration, thereby reducing their reliance on manual verification processes.
The system was designed to prevent multiple registrations against the same documents and enhance institutional checks while facilitating legitimate transactions.
Misuse of System Detected
Despite the reforms, reports in July 2025 indicated misuse of the Auction Module. Following an internal inquiry, FBR found that 103 out of 1,909 uploaded vehicles had been fraudulently entered using fake user identities.
Out of these, 43 cars were already registered by MRAs, giving them the appearance of legal clearance.
The digital audit identified the user IDs linked to the fraud. On July 9, 2025, FBR suspended a Deputy Collector and an Assistant Collector whose credentials had been misused in the scheme.
Here’s an easy breakdown of all this matter:
What the Auction Module system was meant to do
- When Customs seizes smuggled cars, some are later auctioned legally.
- To prevent fraud, the FBR established an online record system in 2021.
- The idea is that when someone buys an auctioned car, the local registration office (where you go to obtain number plates) could check online to confirm whether Customs genuinely auctioned that car.
How officers misused it
- Some FBR officers’ login IDs were used to enter fake car details into this system.
- These fake entries made it look like certain smuggled cars had been legally auctioned.
- Once those false records were in the system, registration offices treated the cars as legal and issued registration papers.
- That way, smuggled vehicles got legal cover — as if they were auctioned by the government, even though they weren’t.
Officers Suspended and JIT Formation
A digital audit identified the user IDs used for the fraud. On 9 July 2025, FBR suspended one Deputy Collector and one Assistant Collector. Their official credentials had been used in the commission of the crime.
Investigations revealed that the fraud was part of a larger network involving MRAs and car dealers.
Recognizing the scale of the scam, the FBR requested a Joint Investigation Team (JIT) on 9 July 2025. The JIT included senior officers from FIA, Customs, and intelligence agencies.
On 10 July 2025, FBR also filed a complaint with the FIA. The FIA registered a case and began its investigation. On 28 August 2025, the FIA lodged an FIR and arrested the officers involved.
Arrests and FIRs Lodged
According to the FBR, seven FIRs have been lodged by Customs Enforcement so far, and 13 individuals have been arrested in connection with the scam.
The arrested officials are accused of colluding with external actors to legalize smuggled vehicles through digital manipulation.
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