FBR crackdown exposes fraud in auctioned vehicles system

Pakistan’s Federal Board of Revenue (FBR) has uncovered a major fraud involving its customs Auction Module, with officials and car dealers accused of illegally registering smuggled vehicles, the tax authority said Wednesday.

In a statement, FBR said the case reflects its broader reform agenda that prioritizes transparency, accountability, and zero tolerance for corruption. The agency said internal checks and disciplinary action are central to its efforts to strengthen institutional integrity.

The Auction Module was introduced in August 2021 to prevent misuse of auctioned vehicles and ensure Motor Registration Authorities (MRAs) could verify auction details online. The move was aimed at reducing reliance on paper-based verification and facilitating legitimate buyers.

But reports in July 2025 revealed misuse of the system. Since its launch, 1,909 vehicles have been uploaded. Investigations showed that 103 of those were fraudulently added using fake user identities. At least 43 of the smuggled vehicles were already registered by MRAs, giving them the appearance of legal clearance.

FBR’s digital audit identified the user IDs linked to the fraud. On July 9, 2025, one Deputy Collector and one Assistant Collector were suspended after their credentials were found misused in the scheme.

Investigators said the fraud was part of a wider criminal racket involving car dealers and officials from MRAs. The seriousness of the case led FBR to request the formation of a Joint Investigation Team (JIT) on July 9, 2025, with senior officers from the FIA, Customs, and intelligence agencies.

Following FBR’s formal complaint, the FIA launched a probe, and on August 28, 2025, registered an FIR against the officers found involved. The suspects have since been arrested. Customs Enforcement has also lodged seven FIRs and arrested 13 individuals in connection with the broader scam.

“This action sends a clear and firm signal that criminal elements within the organization will be identified, exposed, and prosecuted,” FBR said, vowing to uphold the integrity of public service “at all levels and at all costs.”