The Federal Board of Revenue (FBR) has initiated disciplinary and criminal proceedings against its officers after an inquiry revealed their involvement in the fraudulent regularization of smuggled vehicles. The case has now led to arrests by the Federal Investigation Agency (FIA) following a joint probe.
According to an official press release, the crackdown forms part of FBR’s broader transformation agenda, which places emphasis on transparency, accountability, and a zero-tolerance stance on corruption. As part of its reforms, FBR has also launched integrity profiling of its workforce and strengthened internal checks.
The scandal surfaced in July 2025, when reports pointed to misuse of the Auction Module introduced in August 2021 under the WeBOC system. The module had been designed to prevent multiple registrations of vehicles auctioned by Customs and to enable Motor Registration Authorities (MRAs) to verify auction details online, thereby reducing reliance on manual paperwork.
Since the module’s launch, data for 1,909 vehicles was uploaded, but investigators found that 103 vehicles were fraudulently entered using fake user IDs. Of these, 43 smuggled vehicles had already been registered by MRAs, effectively granting them a false appearance of legality.
A digital audit identified the FBR user credentials involved. On July 9, 2025, the board suspended a Deputy Collector and an Assistant Collector whose IDs were used in the scam. Investigations further revealed collusion between MRAs and car dealers, pointing to a broader criminal racket.
Given the scale of the fraud, FBR requested the formation of a Joint Investigation Team (JIT) on July 9, 2025, comprising FIA, Customs, and intelligence officers. A formal complaint to FIA followed on July 10, 2025, after which the JIT began its probe into the manipulation of the Customs digital system.
On August 28, 2025, the FIA registered an FIR against the identified officers and has since formally arrested them. In parallel, Customs Enforcement has lodged seven FIRs and arrested 13 individuals linked to the scam.
FBR said the arrests send a clear message that “criminal elements within the organization will be identified, exposed, and prosecuted in accordance with the law.”
