Pubdate: Mon, 01 Nov 1999 Source: Tampa Tribune (FL) Copyright: 1999, The Tribune Co. Contact: http://www.tampatrib.com/ Forum: http://tampabayonline.net/interact/welcome.htm Author: Michelle Pellemans, The Tampa Tribune BAY AREA BRACES FOR 'DIRTY' MONEY TALLAHASSEE - A bipartisan legislative task force on money laundering does not endorse additional funding as a solution. The Florida Department of Law Enforcement has assigned 16 special agents to fight money laundering in the Tampa Bay area, the financial center of Florida's Gulf Coast. But their focus on money laundering is secondary to narcotics and white collar crime. That may change soon, however, as money launderers in the southern end of the state scout for safer areas in which to cleanse the proceeds from drug transactions and fraud. Much of the blame for the migration can go to folk such as Tom Hunker, the burly commander of the South Florida Interagency Metropolitan Anti- Crime Task Force, or IMPACT. With 70 sworn investigators, Hunker's operation seized $41 million in narcotics money and 16,000 pounds of cocaine and made 103 arrests in 1998. The successful money laundering crackdown in Miami has cities such as Tampa, Orlando and Jacksonville bracing. People in law enforcement liken it to a balloon: squeeze hard on one end and the other end bulges. Money laundering is "not something we've had a tremendous amount of experience with in the last few years," says Charles Guthrie, the special agent in charge of the FDLE's economic crime unit in Tampa. "But it's something we're starting to see more of." Tampa has become a central cleansing point for money from drug deals that take place from Miami to Texas, said Guthrie. A typical case - and one of the biggest in the area - involved Rafiel Mendez, Guthrie said. According to FDLE officials, Mendez, a convicted felon then living in Tampa, was arrested five years ago and charged with attempting to launder $374,000 of a $1 million cache of drug money from Houston through legitimate local businesses and banks. In a plea bargain, FDLE said, Mendez admitted to a weapons possession charge and was sentenced to less than three years in prison. Even bigger than narcotics-related money laundering is illegal sports betting, which generates millions of dollars across Central Florida each year. Then there is the emergence of the Russian mob in Tampa immigration schemes, the sex trade, and "every kind of fraud known to man," including check, credit and bank and mortgage fraud, said Ken Sanz, a 28-year veteran FDLE agent who specializes in Russian and Asian organized crime. Meanwhile, because of a recent crackdowns along the Mexican border, drug traffickers, particularly from Colombia, have been returning to their former Florida haunts, pushing the state to the nation's forefront of money laundering activity. NO FIRM NUMBERS on money laundering exist, though authorities estimate that at least $125 million is laundered through Miami each month, placing it second only to New York City. Although the problem is said to be growing in Central Florida, statistics from the Department of Justice show a steady decline in the number of money laundering cases prosecuted at the federal level. Five years ago, authorities prosecuted 50 cases of money laundering and won convictions in 74 percent of those cases. By 1998, that number had dropped to 11 cases, with an 83-percent conviction rate. The state has been "slow to come up with a tactic that targeted the right thing," says James McDonough, Florida's newly appointed drug czar. "The center of gravity is the money," he said. That money laundering is a growing problem in Tampa and across the center of the state, and that law enforcement may be unprepared for it, has caught the attention of state lawmakers who created a task force this year to study what might be done. The chairwoman of the task force, Ginny Brown-Waite, R- Spring Hill, said the state's slowness stems from its approach, which has been geared more to drug seizures and building new prisons than to going after the money. "If you can cut off their access to money, you can shrink the drug trade," Brown-Waite asserts. Brown-Waite's committee has traveled around the state holding a series of hearings, listening to the concerns of law enforcement, government agencies and business interests. On Friday, the task force presented a draft of its findings and a list of recommendations. A final report is expected to be presented to the Legislature this month. The task force found there's been a surge in illegal money seized on the state's highways. In 1995, for example, $4.61 million was seized by the Florida Highway Patrol along the Interstate 95 and Interstate 75 corridors. That number more than tripled to $18.5 million in 1998. The task force also found major gaps in airport and seaport security, making it easier for money launderers and drug traffickers to enter the state. The task force's proposals range from offering rewards to informants to creating a new law that would permit authorities to slap a 10-day freeze on bank accounts of suspected money launderers to give investigators time to gather evidence. The panel also endorsed toughening laws that would lengthen prison sentences for money launderers. It's been 12 years since the state's existing money laundering laws were enacted. And some of what has been attempted has failed, notes the task force. In March 1994, for example, the state Supreme Court struck down as unconstitutional a sales tax on illegal drugs. While that law was in place, the state collected $2,307,539, according to the Department of Revenue. The new state initiative comes at a time when federal authorities also are gearing up for a renewed crackdown. THE federal strategy includes tougher reporting requirements for banks and other financial institutions required to file suspicious activity reports - a move prompted by the scandal involving the movement of $7.5 billion through the Bank of New York from Russia. Florida also is considering new reporting requirements for financial institutions, and some of those requirements are viewed unfavorably by businesses. Former state Supreme Court justice and lobbyist Wade Hopping, whose client list includes Travelers Express, said such measures as the elimination of a 15-day notice of an impending audit could be unfair and also fail to stem money laundering. "Three or four [of the proposals] really gave us serious heartburn," Hopping added. "We just didn't want them to walk in any day and expect to have books and records ready for inspection." Anthony DiMarco, vice president of government affairs for the Florida Bankers Association, said additional reporting requirements could unfairly burden an industry already doing its best to help stop laundering. "Banks are the first line of defense in money laundering," DiMarco said. "We're complying with what we need to comply on. We're making improvements ... but banks cannot be policemen." Last year in Florida, banks submitted more than 800,000 documents reporting suspicious movement of money, DiMarco said. Even if the recommendations of the task force are adopted, however, law enforcement may still lack the resources to carry them out. - --- MAP posted-by: Jo-D