The focus of the problem was simple, long before American Custom Houses there were British Custom Houses. To simply follow the rules of empire would have impoverished the average trader with limited supply and the very high tariffs of the Molasses Act of 1733 which encouraged the molasses and other goods to be sent back to England. Everyone did smuggling because everyone had to do it. It was this sad but necessary fact that made the practise not just a requirement; it was automatically put into any equation of a business plan.
It was well known in the colonies that the town that had the lowest enforcement was also the most attractive and would attract the most business. Advertisements would boldly be posted even in the local papers which port was the ‘easiest’ place to do smuggling. In the end, avoiding the kiss of death; local ports would actually try to out compete each other.
There was also a Code of Silence that was almost universal in New England; and to break it would often mean the informer would be arrested, given trumped up charges and imprisoned or run out of town; which was better than having a raving mob attack with tar and feather. Respectable merchants wanted to distance themselves as much as possible from their smuggling businesses and the Code prevailed through out colonial society.
It was in this atmosphere that encouraged the local Custom’s Agent to be bribed; or a local official would take the job with sympathies toward the activity of smuggling; or an official would be named but would not actually show up for the job. It was an advantage for everyone to avoid violence either by the affected, or by the aggressor; so “lubricating” the custom’s agent, or pacifying them saved lives and encouraged profitable commerce.
Of course, there was always the danger that the British would actually show up occasionally so either an imposter would play the agent; or there would be a claim he was out-of-town.
For the busiest and largest ports, the British would often put in an official who was more sympathetic to the crown so the next stage in the deception would have to be implemented. Many ships because their cargo was largely unknown would generate fake manifests that indicated the goods came from a British port or a neutral port. Just in case, the obvious source was too apparent, the ship would off-load a portion of cargo and the manifest would only indicate the current amount present at the custom’s dock.
As Newburyport became more prosperous; the large amounts of smuggled goods became more apparent, and more obvious. To avoid penalties; more and more neutral ports were used. The ships would land at a special neutral country that was literally a stone’s throw from the French or other hostile nation to England. At first, the French would off-load their goods and the Americans would re-load onto their ships but after awhile; they would directly load from one ship to the next – and visiting British dignitaries were horrified to see the boldness of these actions.
If you look at the Declaration of Independence, the largest signatory was also one of the most prolific smugglers, John Hancock. In addition, as part of the grievances listed against Britain was the restrictions placed on the American colonies as to where they could trade; which caused so much necessary breaking of the law and caused them to cry out for “Fair Trade”
Newburyport became wealthy with the abundance of rum – which was more than adequate to use as a means of exchange for slaves in the infamous Triangle Trade. Though the Northern colonies were upset over the institution of slavery in the South; most had no problem contributing to it via the molasses/rum and slaves resources.
In Summary, Newburyport became fabulously wealthy far above its small supporting population which would allow them to have the funds to not only build a sophisticated tunnel system but the Code of Silence, and the distancing of the chief smuggler from the rank and file participants allowed them to keep it a great, and undocumented secret especially when so many “dignified” citizens had feeder tunnels in their basements leading to the main underground passage.