The port agent generally has to put up a customs bond to allow a vessel to call at a US port. A small bulk carrier sailed from Haiti bound for Florida and entered the port of Tampa under the auspices of the Tampa agent’s customs bond.

Searches of the vessel revealed two caches of cocaine. US law imposes fines of US$1,000 per ounce on controlled substances. However, the ship and the master and/or owner are not liable for these if it can be shown that the ship was engaged in common carriage, and that the master and/or owner had no knowledge of the presence of the controlled substances nor could have done so with the exercise of the
‘highest’ due diligence.

The ship was therefore allowed to sail by the authorities. Subsequently, a fine of US$500,000 was imposed on the owner, who had in the meantime disappeared. The US authorities then turned their attention to the local agent. After negotiation, the fine was reduced to US$100,000 (the value of the agent’s bond) which the agent had to forfeit. ITIC indemnified the agent.

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