John Vine, the Chief Inspector of Borders and Immigration, said in a report published today it had caused a "significant impact" on the ability of border control staff to seize banned goods and arrest smugglers into the UK.
This amounted to three quarters of all the customs work completed at the National Border Targeting Centre, the hi-tech hub where watch-list checks on passengers entering and leaving Britain are carried out, his report said.
Mr Vine uncovered the problem as part of an inspection into the multimillion- pound e-Borders programme, set up by the Home Office 10 years ago to prevent passengers from travelling where they were considered a threat to the UK.
It involved the collection of Advance Passenger Information for all scheduled passengers, in advance of travel, which was then checked against terror and criminal watch lists. The inspector also found - due to complications surrounding European law - the e-Borders programme had not delivered planned rises in passenger data collectio, with only 65% of passenger movements covered.
"Despite being in development for over a decade and costing over half a billion pounds, the e-Borders programme has yet to deliver many of the anticipated benefits originally set out in 2007," said Mr Vine.
He added: "I was surprised the use of e-Borders information to 'export the border' by preventing the arrival of a passenger because they had either been deported or excluded from the UK previously was not happening."
Labour's Yvette Cooper said: "Theresa May needs to sort out the catalogue of chaos at border control.
"She needs to stop drug-smuggling information being deleted and get the proper border controls in place, rather than relying on divisive gimmicks like ad vans instead."