YANGON – U Kaung Trading Company acted as the shipper for suspected drug dealer Haj Yassin, who was arrested last week in Mandalay Division in connection with last month’s record drug haul in Malaysia, Myanmar Port Authority (MPA) documents show.
The documents were shown to The Irrawaddy by an official at the MPA’s Shipping Agency Department (SAD) on condition of anonymity.
Since last week, at least three suspects have been in the custody of anti-narcotics police in Yangon: U Min Naing, the owner of the Nice Guy Clearance Service Agency; his wife Daw Thida Moe, director of U Kaung Trading Co.; and exporter Haj Yassin. It is unclear whether U Kaung Trading managing director U Aung Soe Moe has been arrested by police or is still at large.
The married couple was arrested some time prior to the June 5 arrest of Haj Yassin, who also goes by the Burmese name Maung Maung and who contracted with U Kaung Trading to export foodstuffs to Malaysia. In fact the shipment contained almost 1.2 tons of methamphetamine and a quantity of heroin disguised as golden tea packages in a container with the Log No. FSCU 9911521 for transport to Malaysia’s Port Klang.
Haj Yassin is the only suspect to have been officially identified by the Ministry of Home Affairs.
Based on the container’s log number, The Irrawaddy has determined that it was transported by the container ship Pathein Star V.017S, owned by Pathein Star PTE Ltd, during the Myanmar Water Festival period, an official long holiday for workers and government servants. The vessel regularly operates between Yangon; Penang, Malaysia; Port Klang, Malaysia; and Singapore.
At a press conference on Wednesday, Myanmar Port Authority (MPA) officials verbally denied online speculation that port officials were somehow involved in the illicit drugs shipment. However, a senior SAD official told The Irrawaddy on condition of anonymity at his office on Wednesday that U Kaung Trading signed the Bill of Lading (BL) as the shipper in the transaction.
Additionally, on a Booking Note contracted between Samudra Shipping Line and the trading company, the shipper’s name is written in bold capital letters as “U KAUNG TRADING CO., LTD.” The name appears on the first line of the agreement, which states that the container is to be discharged at Port Klang (West) in Malaysia. The SAD officer also provided a copy of a Shipping Instruction letter dated April 9, 2018, signed by U Kaung Trading Co. managing director U Aung Soe Moe. It states that the container was loaded with 905 cartons and 120 bags of traditional Myanmar and other types of food items. One of the servicing companies hired by U Kaung Trading also confirmed that U Kaung Trading was the shipper.
U Aung Soe Moe has not shown up at his office in the Kyauktada lower block in downtown Yangon for several weeks. Employees declined to say whether their boss was hiding from police or had being detained.
Trading companies must complete a significant amount of paperwork to expedite the export declaration process. This includes securing recommendations and approvals from Customs, the MPA, and the Commerce Ministry. The process from beginning the paperwork to loading the cargo can take two weeks. Exporting even simple foodstuffs like tea requires a recommendation from the Food and Drug Administration.
Much of the commentary online regarding Customs clearance procedures and the role of port authorities singles out various types of government officials from a range of departments for criticism, alleging that both MPA and Customs officers are likely responsible for the illicit drug shipment.
However, according to MPA deputy general manager Dr. Myo Nyein Aye, the idea that MPA officials are responsible for inspecting shipments is a popular misconception. “We are not authorized to check containers sealed by Customs. And the examination process is not our business either; all we provide is logistics services for the port.”
A senior SAD official added that the shipper is primarily responsible in cases involving illegal drugs. He explained that U Kaung Trading was hired by Haj Yassin to expedite the entire process, from renting a container from a container services company, arranging packing, and contracting with feeder and carrier lines, to handling the declaration process at the destination port. After that, the shipper needs to submit an Export Documentation form (ED), invoice letter, sales contract, shipping instruction, Booking Note and other necessary documents as part of the Customs Department’s documentation examination process.
Following this, the Customs Department assigns the shipper to the Green, Yellow or Red channel based on the Myanmar Automated Cargo Clearance System (MACCS), which receives technical support from the Japanese government. Shippers with a Green designation are automatically exempt from an X-ray scan at the port. Those assigned to either the Yellow or Red channel are usually examined with an X-ray machine, which is handled by a Customs officer. After the X-ray examination process, a container still needs approval from the Customs officer to be sealed and approved for vessel departure.
SAD officials told The Irrawaddy they had no idea whether U Kaung Trading’s container FSCU 9911521 was designated Green, Yellow or Red. If the container was designated Yellow or Red, it would almost certainly have been X-rayed. The Customs Department regularly rotates port and air terminal officials after a few months. It’s unclear which Customs officers were on duty at Myanmar Industrial Port (MIP) during the Water Festival.
One shipping servicing agency staffer explained that there are very few possible loopholes that would allow a shipment to escape an X-ray examination; these would include being designated Green or bribing an officer to turn a blind eye to a cargo container designated Yellow or Red. The Irrawaddy on Wednesday requested a meeting with Customs Department director U Nay Lin Aung but one of his subordinates said his boss was too busy, as he had a number of meetings scheduled for this week in Naypyitaw.
An SAD official said U Kaung Trading has been exporting foodstuffs and other commodities for many years. The department’s BL filing system is not computerized, and it keeps documents for about three years. He declined a request to ascertain precisely how many BL documents U Kaung Trading had submitted in that period, but gave a rough estimate that the company had shipped between 100 and 200 container-loads to Malaysia and Singapore. It is unclear how many times U Kaung Trading had been designated Green or how many times its had provided services for detained suspect Haj Yassin.
“People are blaming the port authorities without understanding the procedures. In fact, the department that is most responsible is Customs. We never touch container checking or X-ray inspections,” the SAD official said.
According to the MPA, the government operates four terminals in Yangon under build, operate and transfer (BOT) agreements with private companies Asia World Port Terminal (AWPT), Myanmar Industrial Port (MIP), Bo Aung Kyaw Street Wharf (BSW) and Ahlone International Port Terminal (AIPT). Only Sule Port, which mostly handles rice shipments, is directly supervised by port authorities. MPA records show that the five terminals handled up to 92,000 containers in fiscal 2016-17 and around 88,500 in 2017-18.
The Irrawaddy visited Seik Kan Myo Ma police station, where Haj Yassin was detained before being sent to a mental hospital to determine whether he is a drug user, but did not see U Min Naing, Daw Thida Moe or U Aung Kyaw Moe. Police Major U Tin Oo said three suspects are being questioned elsewhere in Yangon by a combined team of anti-narcotics police and other relevant departments including the Bureau of Special Investigation.
The Irrawaddy has learned that Haj Yassin is close to U Min Naing’s family and has been working with them for years. Nice Guy Clearance Agency owner U Min Naing was named Second-Best Servicing Agent by the Myanmar Customs Department in 2016. A few days ago, The Irrawaddy attempted to contact some Customs agents who work for Nice Guy, but they did not respond. It’s unclear whether the entire Nice Guy team, which is believed to number about 10 people, were on the run or being interrogated by police.
Another U Maung Maung who is the owner of the Shwe Gabar construction company recently denied unconfirmed reports spread on Facebook that he was the same person as suspect Haj Yassin. The business owner is now 60, whereas the suspect detained by police is 44. The Myanmar Construction Entrepreneurs Association vouched for the older U Maung Maung, saying he was an executive committee member and an honest man.
Nine days since the arrest of Haj Yassin, police had not provided any updates about Haj Yassin’s background or its investigation results as of Thursday. Many commentators on Facebook predicted that the case would end with the arrest of Haj Yassin, with the mastermind let off the hook as usual. Yangon Division Police spokesman Major Hla Wai on Thursday declined to confirm for The Irrawaddy the arrests of the married couple or any other suspects.
Maj Hla Wai said, “We are still questioning [Haj Yassin]. We have already announced his arrest in newspapers as well, which is the latest information. We cannot discuss the case further as the investigation is ongoing. The Irrawaddy should understand that this is an ongoing case and we are still investigating.”