A large apparel manufacturer.
A potential client had an existing duty drawback program to recover Customs duty paid for the goods they imported and then exported. The company approached J.M. Rodgers Co. looking to change drawback brokers. The potential scope of work included a complete transition of their duty drawback program and an audit of their import and export data banks. The company already had Customs approvals for a dual-duty drawback program using 1313 (j)(1) and 1313 (j)(2), but the program had not resulted in any refunds. During the transition from the previous broker, we found more significant issues than unclaimed refunds. The previous provider was doing little to no compliance reviews of earlier claims and the corresponding data. Incomplete data was also an issue and had rendered some of the client’s inventory useless for drawback. Lastly, because of the incomplete data, we were having trouble verifying values and quantities.
J.M. Rodgers started to piece together what the previous broker had done. We requested all relevant import and export data the previous broker had with the client. Upon receiving the relevant documents and data, we realized we had only 2,000 entries instead of the promised 6,000 entries. It became clear that we could not start a new program before understanding where the previous broker went wrong. JMR was provided access to the customer’s ACE (Automated Commercial Environment) portal. Using ACE data against the import broker’s data, we identified the problems that we needed to fix. Unfortunately, this required going to our client and informing them that their previous broker’s import entries were corrupting their data banks and inventory, which meant they had to let a year of data get liquidated. The client agreed, and, at their request, we removed the data from the client’s data banks, allowing us to select a new starting point so we could begin to work with “clean” data and provide proper visibility of their program moving forward.
Scrubbing the client’s data gave us a new starting point on the import data, which led to a successful drawback program yielding over two million dollars in annual refunds.