Pubdate: Wednesday, September 29, 1999 Source: Bergen Record (NJ) Copyright: 1999 Bergen Record Corp. Section: Lead Editorial Page: L-6 Contact: 150 River Street, Hackensack, NJ 07601-7172 Feedback: http://www.bergen.com/cgi-bin/feedback Website: http://www.bergen.com/ AN OVERDUE CRACKDOWN Washington Wants To Target Money Launderers FOR YEARS, it has been an open secret that America's attempts to stem money laundering have been about as effective as North Jersey's efforts to curb sprawl. But now, Washington may finally be ready to crack down on the criminals who have used loopholes in our laws to sanitize their criminal proceeds. Last week, on the heels of a massive Russian money laundering scandal said to involve American banks, the Clifton administration proposed a far-reaching strategy to go after the billions in dirty dough that gets sanitized every year. The game plan includes: • requiring casinos, check cashiers, brokerage firms, and other financial services firms to report all suspicious big money transactions, such as using small bills to pay for a large electronic money transfer; •clarifying the laws on taking large amounts of cash out of the country; • increasing law enforcement in regions such as New Jersey, where money laundering is rife; • cracking down on illegal international cash transactions by expanding the list of foreign money laundering crimes punishable by U.S. law—including the misuse of American aid. It's about time. As The Record's award winning series "Dirty Money" has shown, laundering tainted cash is not only a cornerstone of illegal drug trafficking, but it enables all sorts of shady operators to evade paying millions upon millions of dollars in taxes. Several of the proposals in the package would bolster New Jersey's mixed efforts to go after money launderers. The Garden State would be a strong candidate for increased federal enforcement efforts because it is such a popular destination for tainted money. The state has thriving ports, a major international airport at Newark, all those cash gobbling casinos in Atlantic City, and a perfect location — between Philadelphia and New York City. Last year alone, $14 million in cash was confiscated at the state's ports, including an $11 million seizure at Port Newark. But that's considered a ripple in the tidal wave of dirty cash leaving through our ports. Atlantic City has long been a haven for money launderers, who can take satchels crammed with $10 and $20 bills into casinos, buy gambling chips, and then cash them in a short time later for larger, untraceable bills—or transfer the money electronically. Similarly, check cashers in New Jersey currently must keep track of large cash transactions but aren't required to notify law enforcement of suspicious transactions. The proposed Treasury regulations requiring the casinos and check cashers to report these dubious transactions is an excellent idea. Also in the package is a bill introduced this year by Rep. Marge Roukema, R-Ridgewood, to strengthen federal laws against the bulk smuggling of American currency. Until mid 1998, Customs agents tried to stem this outbound flow of tainted money by confiscating any undisclosed cash above the $10,000 federal reporting threshold. But the rules changed last year when the Supreme Court ruled that seizing the unreported bulk cash at the borders was excessive, because the only law being broken was a failure to disclose the money. Mrs. Roukema's bill would clarify the circumstances when the money could be seized. That way, the revised law likely would pass constitutional muster. Good move. Both Congress and the Clinton administration have dragged their feet on combating money laundering, then blamed each other for the delays. But after that massive Russian money laundering scandal, in which the Russian mob moved an estimated $7.5 billion in tainted cash through the Bank of New York and other American banks, Washington may finally stop the finger pointing and start clamping down on dirty money. - --- MAP posted-by: Richard Lake