Philippines: Why the Customs–LTO contradiction on the Discayas’ luxury cars matters; what's next?

Manila: The plot thickens in the flood-control scandal as public outrage over corruption reaches a boiling point.

The ongoing investigation into over 30 luxury vehicles owned by Cezarah "Sarah" and Pacifico "Curlee" Discaya—dubbed the "Queen" and "King" of flood control projects—has uncovered a disturbing contradiction between two major government bodies: the Bureau of Customs (BOC) and the Land Transportation Office (LTO).

Were vehicles smuggled into the country and knowingly registered by LTO personnel? Or did irregularities occur at the BOC during the importation process of these luxury cars, which now form part of the Discayas' lavish collection?

This unresolved questions fuel the mounting suspicion and demands for accountability.

At the very least, the BOC-LTO conflicting findings could expose serious irregularities in how high-value vehicles enter and get registered in the Philippines.

At the very most, it could expose inside-jobs at both agencies when it comes to processing luxury vehicle imports.

Potentially, this could lead to criminal and administrative charges against scalawags in both BOC and LTO.

On Tuesday (October 7), local media reported that more than 10 BOC employees are facing scrutiny over the questionable importation of luxury cars that ended up with the Discayas. What we know so far:

Customs Commissioner Ariel Nepomuceno said that based on their investigation, eight of the Discayas’ vehicles were imported without corresponding import entries, classifying them as smuggled.

“These vehicles are subject to the issuance of Warrants of Seizure and Detention,” Nepomuceno said.

He added that seven more vehicles, although covered by import entries, lacked Certificates of Payment (CPs) — proof that taxes and duties had been paid. The rest, 14 other vehicles, were properly documented but will still undergo a Post Clearance Audit for verification.

“This is part of our efforts to address irregularities in the importation of high-value goods,” Nepomuceno told local media, adding that he was ready to present the findings to the Independent Commission on Infrastructure (ICI).

In September, one of the auto dealers who supplied luxury cars to the Discayas was linked to the smuggling of two sports cars to the Philippines in 2022.

LTO chief Assistant Secretary Vigor Mendoza II disagrees with Customs. He said that based on LTO checks, all 13 luxury vehicles registered under the Discayas and their companies had “passed documentary checks.”

“Based on the reports I received, all the seized [Discaya] vehicles possess all four required documents,” Mendoza said. These include the certificate of tax report, police clearance, invoice, and the BOC-issued Certificate of Payment (COP).

Mendoza explained that the COPs were electronically transmitted from Customs to the LTO — not manually submitted.
“It’s not something handed over across a window,” he said. “So, when Customs says the documents are incomplete, that’s not in the context of registration.”

The BOC claims many of the vehicles lacked legitimate import records or valid COPs, while the LTO insists all the documents were electronically received and verified.
This contradiction raises two serious possibilities:

If Customs proves that the vehicles entered the country without valid import entries or duties paid, it would confirm large-scale vehicle smuggling — possibly with insider help.

This could expose a network of corruption or document manipulation within the import and registration pipeline, especially if the vehicles were registered despite lacking clearance from Customs.

Such a discovery could also implicate personnel from the LTO, if it’s found they knowingly registered smuggled vehicles.

If the LTO’s digital records are proven authentic, then the problem likely lies within Customs — suggesting that the agency’s data on import entries and Certificates of Payment may have been tampered with or erased internally.
That could expose systemic weaknesses or collusion within BOC offices handling import verification and document transmission.

Mendoza said the LTO is now working with the Philippine National Police Cybercrime Unit to trace whether the COPs in their database were altered or forged.
“If the documents electronically transmitted to the LTO were found to be falsified, it would be a serious warning sign,” he said. “However, if the investigation reveals that LTO personnel falsely made it appear that documents had been properly filed, those involved will face accountability.”

Nepomuceno’s BOC, on the other hand, is conducting a Post Clearance Audit and has seized the 13 vehicles already in question.

This case could open a can of worms for both agencies. It highlights potential flaws in:

The conflicting records between the two agencies don’t just point to a documentation mismatch — they suggest possible collusion or cybersecurity breaches that may have enabled luxury car smuggling under official cover.

Both the BOC and LTO chiefs are expected to appear before the Independent Commission on Infrastructure (ICI) to clarify the discrepancies.

Lawmakers, including Rep. Terry Riddon, have urged the commission to probe how both agencies’ systems could produce opposite findings on the same set of vehicles.

The outcome of this investigation could redefine how the Philippines monitors luxury vehicle imports — and potentially lead to criminal and administrative charges against erring officials in either, or both, agencies.