As corollary to the Townshend duties, the British tightened their supervision of colonial trade. The American Board of Customs Commissioners was created in 1767, raising the number of customs officials, constructing a colonial coast guard, and providing money to pay informers. However, the new board drew criticism due to its methods of enforcement. Like cases adjudicated under the Sugar Act, defendants were assumed guilty until they could prove otherwise. Informers were awarded one-third of all goods and ships confiscated from smugglers, an incentive to falsify charges and report shippers who committed even the slightest of offenses. Once the cases were transferred to vice-admiralty courts, they had a very high rate of conviction.
Customs officers enforced the duties vigorously and in underhanded manner, often relaxing certain technical restrictions for a time period and then suddenly clamping down. Customs officers would often claim that small items stored in a sailor's chest were undeclared cargo, and seize entire ships on that charge. The behavior of customs agents, often known as "customs racketeering," amounted to little more than legalized piracy. The activities of agents, and especially of informers, provoked considerable opposition from the colonists. Almost all cases of tarring and feathering during the years of the Townshend duties were instances of personal vengeance against informers. After 1767, riots led by sailors were increasingly common. Still, agents enforced the law strictly and tensions mounted.
In June 1768, John Hancock, the wealthiest of all Boston merchants, had a sloop, the Liberty, seized by customs agents on a perjured charge. A crowd of angry Bostonians formed, and tried to prevent the towing of the ship. Unsuccessful, they assaulted the customs agents in charge. The growing mob drove all of the revenue inspectors from the city.
By 1770, the British government began to reform the corrupt customs service. Charges against Hancock were dropped in fears that he would appeal to England, where honest officials would recognize the customs officers' deceit. In January 1770, Lord North became prime minister. He favored eliminating most of the Townshend duties to prevent a further split between the colonies and mother country. On April 12, 1770, Parliament did just this. However, Lord North insisted on maintaining the profitable tax on tea.
In response, Americans ended the policy of general non-importation, but maintained voluntary agreements not to consume British tea. Non-consumption kept the tea tax revenues far too low to pay the royal governors. The Townshend duties were effectively dead.
The behavior of the customs officials sent to enforce the Townshend duties convinced the colonists more than ever that their relationship with the British authorities had become one of enmity. The activities of informers and agents seemed to consist of petty needling at the colonists simply for the sake of antagonism, and as before, the colonists were outraged at the British concept of justice that accompanied the duties in the form of vice-admiralty courts.
Boston was an obvious target for unscrupulous customs agents, as the colonies' largest port and largest center of smuggling. John Hancock was also a major target, as a wealthy merchant and an influential advocate for colonial rights. Customs agents claimed falsely that the Liberty had avoided paying 700 pounds on Madeira wine worth 3,000 pounds and demanded triple payment on the wine, 9,000 pounds, about thirteen times the amount of the alleged tax evasion. Hancock refused to pay and the agents towed the Liberty. For many Americans, this was the last straw, proving that British authorities were out to cause suffering in the colonies and nothing more.
During the enforcement of the Townshend duties, many colonists began to question Parliament's ability to legislate for them, to an even greater extent than before. Previously, they had almost unanimously accepted the principle that Parliament could pass some laws pertaining to the colonies, but the infringement on liberty that accompanied the enforcement of the Townshend duties had convinced many, by 1770, that Parliament should not be permitted to legislate for the colonies in any case. The cry of "no taxation without representation" was gradually being expanded to "no legislation without representation." Though the reforms instituted by the British government largely ended the abuses of the customs agents, the enmities created could not be so easily bridged; the Townshend duties were a major step in the progressive alienation of the colonies from Britain.
The Repeal of the Townshend duties presented a dilemma for colonial leaders, who had to decide whether to continue all non-importation policies in protest of the continued tax on tea, the most profitable item, or to selectively boycott tea. Eventually, they decided on informal non-consumption agreements, which proved fairly effective. However, the tax on tea remained a visible reminder of Parliament's insistence on the broadest possible interpretation of the Declaratory Act. Tea would prove a divisive issue in the coming years as the colonies neared rebellion.