February 13, 2012 in Featured
US sees cash smuggling as critical in drug trafficking fight; experts doubt results are enough (AP):
Jeanette Barraza-Galindo conspicuously left her bags of teddy bears and throw pillows on a bus during an inspection at the Texas-Mexico border — and professed ignorance about the $277,556 officers found hidden inside. The bags were handed to her at a bus station, gifts to be given to a child upon her return to Mexico, she told investigators.
The crime she pleaded guilty to — bulk cash smuggling — is increasingly drawing the attention and resources of federal authorities responsible for fighting drug trafficking across the border. Federal immigration authorities say their investigations have yielded more cash seizures and arrests in the past half-dozen years as criminals, sidestepping scrutiny from banks over electronic transfers, resort to using cash to conceal drug trafficking and move money to crime rings in Mexico and elsewhere.
It’s similar to the tactic taken in fighting terrorism: crippling financing networks before the money ends up with leaders of drug cartels and trafficking rings. But the flow is hard to stop.
Officials in both the U.S. and Mexico are realizing that criminal enterprises, just like other businesses, can’t operate without a steady cash stream, said David Shirk, director of the Trans-Border Institute at the University of San Diego, which promotes scholarship of border issues.
“We’re shifting our strategy to a more diverse strategy of not just going after bad guys and arresting them, but also going after their guns, going after their money,” he said.
It’s illegal to try to smuggle more than $10,000 in undeclared cash across the border. Officials say the crime is often connected to other illegal activities including drug trafficking, gambling and credit card fraud. Money that’s seized is deposited into government forfeiture funds.
The Obama administration says targeting bulk cash smuggling is a prong of its strategy against transnational crime. Congressional panels held hearings on the issue last year. U.S. Immigration and Customs Enforcement reported more than $150 million in seized cash and 428 arrests in bulk cash smuggling investigations in fiscal year 2011, up from $7.3 million and 48 in fiscal year 2005, according to agency statistics.
And a cash smuggling center in Vermont that opened in 2009 and is run by ICE’s homeland security investigations has expanded operations, officials announced in December.
But experts say measuring the impact of the beefed-up focus is tricky.
It’s hard to track cash’s origin and destination — and investigators can’t always count on help from couriers, who may be more afraid cooperating than of spending a few years in prison. Plus, the amount seized represents a fraction of the total money at stake. Estimates cited by federal authorities suggest at least $18 billion in illicit proceeds is laundered across the southwestern border each year.
“I call this winning the battle, losing the war. Sure, $90 million sounds like a lot,” said Bruce Bagley, a University of Miami international studies professor who researches drug trafficking. “That’s nothing in comparison to the $19 to $39 billion that’s being returned” across the border.
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