Pubdate: Wed, 08 Aug 2001 Source: Miami Herald (FL) Copyright: 2001 The Miami Herald Contact: http://www.herald.com/ Details: http://www.mapinc.org/media/262 TO CURB DIRTY MONEY Strengthen U.S. Laws Against Money Laundering. Attorney General John Ashcroft got it right yesterday when he called on Congress to strengthen U.S. laws against money laundering. Our obsolete laws make it all too easy for organized crime operatives, drug traffickers or corrupt foreign despots to hide their loot in U.S. banks. Thankfully, Congress can fix some of the worst loopholes by approving the Money Laundering Abatement Act just introduced by Sens. Carl Levin, D-Mich, Chuck Grassley, R-Iowa and Bill Nelson, D-Fla. The legislation is well-conceived. Sen. Levin, chairman of the Subcommittee on Investigations, spent three years analyzing U.S. banking practices that welcome dirty money. He cites estimates that $1 trillion is laundered each year, with $500 billion -- half the world's total -- moving through U.S. banks. The bill takes aim at practices money launderers love: bank secrecy that covers their identities and money trails; offshore shell banks, which exist only on paper and funnel illicit money; and bank forfeiture-rule loopholes that bar U.S. prosecutors from seizing dirty assets from the U.S. accounts of foreign banks. These are tools used by masters of corruption. Take Vladimiro Montesinos, Peru's former spy master. He is accused of everything from running death squads to amassing $270 million, which was laundered through offshore shell banks that kept some of it in U.S. banks -- ready for him to dole out in bribes and kickbacks. He even had at least two accounts in his own name at the Bank of New York, according to Money Laundering Alert, a Miami newsletter. The Levin bill would make it more difficult for the likes of Montesinos. First, it would allow U.S. prosecutors to bring money- laundering charges against depositors and U.S. institutions in cases where funds originate from foreign-corruption offenses, such as theft of public funds. It would require banks operating here to conduct more-rigorous due- diligence reviews on accounts of foreign clients that have more than $1 million and on correspondent accounts of offshore banks based in high-risk money-laundering countries. Other provisions would bar U.S. banks from providing services to offshore banks that have no physical presence; and would make deposits in foreign banks' U.S. correspondent accounts subject to the same forfeiture rules that now apply to other U.S. bank deposits. The legislation doesn't cover everything. It leaves the securities industry untouched, for example. The subcommittee plans to tackle that next. Overall, it's a good start to curbing the uncontrolled wash of illicit funds and international crooks seeking safe financial haven in the United States. By approving this commendable effort to keep U.S. banks clean, Congress would send the message that the United States won't shelter criminals or their profits. - --- MAP posted-by: Terry Liittschwager