Lapas attēli

Chairman St. Germain, Members of the House Subcommittee

on Financial Institutions Supervision, Regulation and

Insurance :

I am pleased to appear before you today

to discuss drug trafficking and money laundering.

Before describing the Drug Enforcement Administration's role in money laundering investigations, I would like

to briefly explain DEA's role in drug law enforcement.

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Federal, State, local and foreign officials and is responsible for ensuring that legitimately produced pharmaceutical products are not diverted into the illegal

drug market.

Our criminal investigators and diversion

investigators work in offices in the United States and in

countries overseas.

In addition, DEA assists and supports other Federal,

State, and local agencies and

foreign governments with

training, crop eradication programs and other

non-enforcement programs designed to reduce the availability of illicit drugs.

Under the policy guidance of the

Secretary of State and U.S. Ambassadors, DEA shares

responsibility for all programs associated with drug law

enforcement counterparts in foreign countries.

The Drug Enforcement Administration acts as liaison with the United Nations, Interpol, and other organizations

on matters relating to international narcotics control


DEA works closely with the State Department on

international liaison, and with the Federal Bureau

of Investigation, the Customs Service, the Coast Guard, and

several other Federal agencies on a variety of national and

international initiatives, including the seizure and

forfeiture of assets derived from, traceable to, or intended

to be used for illicit drug trafficking.

Today's drug traffickers are truly international entrepreneurs and, because of this, international cooperation

in investigating cases, obtaining evidence, and coordinating

prosecutions is crucial to DEA and Justice Department

enforcement efforts.

DEA has encouraged bilateral mutual

legal assistance treaties, other bilateral agreements, and a number of other cooperative arrangements to provide us with

better intelligence and with evidence which might otherwise

be unavailable because of bank secrecy laws.

As you have requested, I would now like to expand on

the subject of money laundering of drug profits and the

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greatly increased its emphasis on programs to separate traffickers from their ill-gotten gains. Experience has

shown that regardless of the size of an illegal drug

operation, the arrest of an organization's members--or even

its leaders--will not necessarily put the operation out of


There are always associates, lieutenants, or

family members ready to continue operations while the boss

is in jail--and the boss may even be calling the shots from

behind bars.

But, when DEA seizes all of the property belonging to

the leaders of one of these drug operations, the organization

is rendered impotent.

Whenever we can, we take their cars,

airplanes, bank accounts, homes, ranches, racehorses,

businesses, stocks and bonds, and everything else that can

be legally forfeited to the government.

DEA, the Federal Bureau of Investigation, the Internal

Revenue Service, the U.S. Marshals Service, the Organized

Crime Drug Enforcement Task Forces, and the Criminal

Division of the Department of Justice all cooperate in tracing drug assets and in the use of criminal and civil

forfeiture laws, currency and tax laws, and international

agreements against tax evasion and money laundering.

DEA and the FBI often initiate the tracing of money and

property, and the Internal Revenue Service identifies and

investigates individuals who derive substantial income from

narcotics trafficking.

IRS agents also assist in tracing

the movement of funds and the acquisition of assets and they investigate violations of the Bank Secrecy Act, which has

criminal penalties for financial institutions and officials who intentionally fail to file or falsify the necessary reporting forms.

Seized cash and the proceeds received from auctioning seized and forfeited property are generally turned over to the U.S. Marshals Service, through its National Asset

Seizure and Forfeiture Program, for deposit in the DOJ Asset

Forfeiture Fund.

Federal law enforcement agencies often use

the cars, boats and aircrafts for future law enforcement operations, and state and local agencies frequently share

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pro rata in all of the assets seized in a cooperative


In FY-1985, DEA seized cash and other property valued

in excess of $ 250 million and we plan to do more.

We are

forming and training specialized teams of agents and analysts in many of our division offices--supplemented in some cases by IRS agents and state and local officers.

These teams review all of the cases developed in their

offices; they identify property, locate it, determine legal ownership, and work with United States Attorneys to effect

ultimate forfeiture. The prototype asset removal team in our San Diego office has had outstanding success. As this technique is implemented elsewhere, DEA looks forward to

substantial increases in nationwide asset removals.

But while DEA is pleased with the progress of its asset

removal program, we are also anticipating that our success

will create other problems--in particular, an increase

in trafficker efforts to hide assets and launder money.

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