[Congressional Record Volume 144, Number 51 (Thursday, April 30, 1998)]
[Senate]
[Pages S3926-S3929]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. LEAHY (for himself, Mr. Daschle, Mr. Kohl, Mrs. Feinstein, 
        and Mr. Cleland):
  S. 2011. A bill to strengthen the Federal prosecution and seizure of 
illegal proceeds of international drug dealing and criminal activity, 
and to provide for the drug testing and treatment of incarcerated 
offenders and reduce drug trafficking in correctional facilities, and 
for other purposes; to the Committee on the Judiciary.


The Money Laundering Enforcement Act and the Combating Drugs in Prisons 
                                  Act

  Mr. LEAHY. Mr. President, today, joined by Senators Daschle, Kohl, 
Feinstein, and Cleland, I am introducing legislation which will provide 
state and federal governments with additional tools to fight drug 
trafficking, money laundering and drug use in prisons. This legislation 
is intended to complement the Administration's comprehensive 10-year 
National Drug Control Strategy by providing federal prosecutors with 
additional means to seize assets linked to illegal criminal and drug 
activity and prevent drug kingpins and others from engaging in money 
laundering. In addition, this legislation will allow states to use 
federal prison grant funds to test and treat drug-addicted inmates and 
parolees.
  I note that the Speaker of the House today is hosting a Republican 
rally to proclaim fault with the Administration's comprehensive drug 
control strategy. Mr. President, the bill that we are introducing today 
is not the easy rhetoric that some have to offer in this crucial area 
of public policy. Here is a chance to actually make a difference. I do 
not find constructive the efforts of the other body's Republican 
leadership over the past few years to slash assistance for drug 
enforcement, prevention and treatment programs. Twice, in fact, they 
tried to cut the extremely effective Safe and Drug-Free Schools funding 
by 50 percent, just as they significantly reduced support for drug 
prevention and treatment programs when they assumed leadership of the 
Congress in 1995.
  Nor do I consider it constructive for Speaker Gingrich, as he did in 
his February radio address, to fault the Administration while at the 
same time claiming credit for such Administration strategies as a 
national youth-oriented anti-drug campaign and added support for 
community programs and schools. These are key components of the 
Administration's 1998 National Drug Control Strategy, including the 
highly effective radio and TV ads now airing in 12 pilot cities. To 
really make a difference in more than just the headlines, we need to 
work together to reduce the quantity of drugs coming into this country 
and the number of drug addicts both in prison and walking our streets.


                      Money Laundering Act of 1998

  This act will help prosecutors force international criminals out of 
the darkness and into the light by greatly reducing their ability to 
hide behind foreign banking laws or other procedural tricks. It will 
also ensure that defendants arrested overseas are no longer able to use 
the U.S. courts to their benefit while fighting against being 
extradited to the United States.
  Another provision in this bill which allows federal prosecutors to 
temporarily seize U.S. assets owned by individuals arrested overseas 
will greatly enhance law enforcement's ability to shut down drug 
trafficking operations based outside the United States. National 
boundaries mean less and less to drug kingpins and other criminals 
today and this legislation will help us reform our Nation's laws to 
reflect this reality.
  This bill would allow a brief ex parte seizure of assets while any 
arrest papers are in transit to prevent individuals arrested in another 
country from moving the fruits of their crimes from the United States 
to another country. Currently, foreign defendants often move their 
assets virtually instantaneously via electronic transfers while our 
prosecutors are waiting for the arrest records. In addition, defendants 
would no longer be able to hide behind foreign bank secrecy laws while 
they claim seized property in United States courts.
  This bill makes important procedural changes for federal prosecutors: 
it extends U.S. jurisdiction over foreign banks; updates evidentiary 
rules regarding foreign records; allows federal prosecutors to charge 
defendants who engage in multiple illegal acts with course of conduct 
claims; and allows prosecutors to charge criminals with conspiracy to 
violate the laws.
  This legislation also adds several new crimes to the list triggering 
asset forfeiture, including crimes of violence, additional foreign 
crimes, and crimes committed by or against foreign governments. While I 
believe that these provisions are necessary for prosecutors to carry 
out their important work, I realize that some of these provisions may 
need to be fine-tuned to accomplish their intended goal. I pledge to 
work with members on both sides of the aisle to ensure that this 
legislation is broad enough to meet these goals without being overly 
intrusive.
  In drafting this bill, I have purposely avoided including several 
domestic asset forfeiture provisions. While we may have to face these 
thorny issues down the road, I decided to craft a bill which I believe 
can be supported by the majority of Senators. We can then bring up 
these more complicated issues after a fuller discussion has taken 
place.


                The Combating Drug Abuse in Prisons Act

  This act will allow states to use any of the funds they receive under 
the Violent Offender Incarceration and Truth in Sentencing grant 
programs to provide drug testing and treatment for inmates and other 
court-supervised individuals, such as probationers and parolees. With 
80 percent of inmates reportedly linked to drug and alcohol activity 
and with a requirement in place that states develop and implement a 
drug testing and treatment plan for these individuals by September 1, 
1998, it is critical that this federal funding be made available for 
these purposes.

  According to a study recently released by the National Center on 
Addiction and Substance Abuse (CASA) based at Columbia University, 80 
percent of individuals currently incarcerated either ``violated drug or 
alcohol

[[Page S3927]]

laws, were intoxicated at the time they committed their crimes, stole 
property to buy drugs, or are `regular drug users'.'' This study also 
found that inmates who are illegal drug or alcohol abusers are the most 
likely to be repeat offenders. In fact, this study concluded that 61 
percent of state prison inmates who have two prior convictions are 
regular drug users. Another recent study, conducted by the Bureau of 
Justice Statistics, found that over half of all convicted jail inmates 
in 1996 reported having used drugs in the month prior to their offense. 
Sixty percent of these inmates also reported using drugs or alcohol or 
both at the time of the offense for which they were charged.
  If we want to stem the increase in our Nation's prison population, we 
must determine which inmates are addicted to drugs or alcohol, reduce 
the availability of drugs in prisons and ensure inmates have access to 
the treatment they need while incarcerated. This bill will help states 
meet all these goals by allowing them to use as much as they choose--or 
as little--of the federal prison funds they receive for drug testing 
and intervention and to develop strategies to reduce drug trafficking 
into prisons. As Joseph Califano, former Secretary of Health, Education 
and Welfare and president of CASA, noted when the CASA study was 
released: ``Releasing drug-addicted inmates without treatment helps 
maintain the market for illegal drugs and supports drug dealers.''
  I realize some of my colleagues may be concerned about funds 
originally designated for prison construction costs being used for drug 
testing and treatment. Let me assure you that states will retain 
complete flexibility under this bill as to how they allocate their 
Truth in Sentencing and Violent Offender Incarceration grant funds. 
But, I'd also like to point out that according to the CASA study, it 
would cost states approximately $6,500 per year to provide 
comprehensive and effective residential drug treatment services to an 
inmate. While this figure may seem high, the study further determined 
that society will see an economic return of $68,800 for each inmate who 
successfully completes such a program and returns to the community 
sober and with a job. This figure represents the savings in the first 
year based on the much lower likelihood that the former inmate will be 
arrested, prosecuted or incarcerated and includes health care savings 
and the potential earnings of a drug-free individual.
  James Walton, Vermont's Commissioner of Public Safety, wholeheartedly 
supports this legislation, and I have always valued his counsel. As the 
head of Vermont's law enforcement agency, he has first-hand knowledge 
of what the real needs are in my state. Clearly, he believes that this 
legislation will have a positive effect on ongoing law enforcement and 
drug control strategies in Vermont. I'm certain it will have the same 
effect across the country. I urge my colleagues to support this bill so 
our federal and state officials have the resources they need to combat 
our Nation's drug problems--both overseas and in our nation's prisons.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2011

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Money 
     Laundering Enforcement and Combatting Drugs in Prisons Act of 
     1998''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.

                TITLE I--INTERNATIONAL MONEY LAUNDERING

Sec. 101. Short title.
Sec. 102. Illegal money transmitting businesses.
Sec. 103. Restraint of assets of persons arrested abroad.
Sec. 104. Access to records in bank secrecy jurisdictions.
Sec. 105. Civil money laundering jurisdiction over foreign persons.
Sec. 106. Laundering money through a foreign bank.
Sec. 107. Specified unlawful activity for money laundering.
Sec. 108. Criminal forfeiture for money laundering conspiracies.
Sec. 109. Fungible property in foreign bank accounts.
Sec. 110. Subpoenas for bank records.
Sec. 111. Fugitive disentitlement.
Sec. 112. Admissibility of foreign business records.
Sec. 113. Charging money laundering as a course of conduct.
Sec. 114. Venue in money laundering cases.
Sec. 115. Technical amendment to restore wiretap authority for certain 
              money laundering offenses.

  TITLE II--DRUG TESTING AND INTERVENTION FOR INMATES AND PROBATIONERS

Sec. 201. Short title.
Sec. 202. Additional requirements for the use of funds under the 
              violent offender incarceration and truth-in-sentencing 
              incentive grant programs.
Sec. 203. Use of residential substance abuse treatment grants to 
              provide for services during and after incarceration.
                TITLE I--INTERNATIONAL MONEY LAUNDERING

     SEC. 101. SHORT TITLE.

       This title may be cited as the ``Money Laundering 
     Enforcement Act of 1998''.

     SEC. 102. ILLEGAL MONEY TRANSMITTING BUSINESSES.

       (a) Civil Forfeiture for Money Transmitting Violation.--
     Section 981(a)(1)(A) of title 18, United States Code, is 
     amended by striking ``or 1957'' and inserting ``, 1957, or 
     1960''.
       (b) Scienter Requirement for Section 1960 Violation.--
     Section 1960 of title 18, United States Code, is amended by 
     adding at the end the following:
       ``(c) Scienter Requirement.--For the purposes of proving a 
     violation of this section involving an illegal money 
     transmitting business--
       ``(1) it shall be sufficient for the Government to prove 
     that the defendant knew that the money transmitting business 
     lacked a license required by State law; and
       ``(2) it shall not be necessary to show that the defendant 
     knew that the operation of such a business without the 
     required license was an offense punishable as a felony or 
     misdemeanor under State law.''.

     SEC. 103. RESTRAINT OF ASSETS OF PERSONS ARRESTED ABROAD.

       Section 981(b) of title 18, United States Code, is amended 
     by adding at the end the following:
       ``(3) Restraint of assets.--
       ``(A) In general.--If any person is arrested or charged in 
     a foreign country in connection with an offense that would 
     give rise to the forfeiture of property in the United States 
     under this section or under the Controlled Substances Act, 
     the Attorney General may apply to any Federal judge or 
     magistrate judge in the district in which the property is 
     located for an ex parte order restraining the property 
     subject to forfeiture for not more than 30 days, except that 
     the time may be extended for good cause shown at a hearing 
     conducted in the manner provided in Rule 43(e) of the Federal 
     Rules of Civil Procedure.
       ``(B) Application.--An application for a restraining order 
     under subparagraph (A) shall--
       ``(i) set forth the nature and circumstances of the foreign 
     charges and the basis for belief that the person arrested or 
     charged has property in the United States that would be 
     subject to forfeiture; and
       ``(ii) contain a statement that the restraining order is 
     needed to preserve the availability of property for such time 
     as is necessary to receive evidence from the foreign country 
     or elsewhere in support of probable cause for the seizure of 
     the property under this subsection.''.

     SEC. 104. ACCESS TO RECORDS IN BANK SECRECY JURISDICTIONS.

       Section 986 of title 18, United States Code, is amended by 
     adding at the end the following:
       ``(d) Access to Records Located Abroad.--
       ``(1) In general.--In any civil forfeiture case, or in any 
     ancillary proceeding in any criminal forfeiture case governed 
     by section 413(n) of the Controlled Substances Act (21 U.S.C. 
     853(n)), the refusal of the claimant to provide financial 
     records located in a foreign country in response to a 
     discovery request or take the action necessary otherwise to 
     make the records available, shall result in the dismissal of 
     the claim with prejudice, if--
       ``(A) the financial records may be material--
       ``(i) to any claim or to the ability of the government to 
     respond to such claim; or
       ``(ii) in a civil forfeiture case, to the ability of the 
     government to establish the forfeitability of the property; 
     and
       ``(B) it is within the capacity of the claimant to waive 
     his or her rights under such secrecy laws, or to obtain the 
     financial records himself or herself, so that the financial 
     records may be made available.
       ``(2) Privilege.--Nothing in this subsection shall be 
     construed to affect the rights of a claimant to refuse 
     production of any records on the basis of any privilege 
     guaranteed by the Constitution of the United States or any 
     other provision of Federal law.''.

     SEC. 105. CIVIL MONEY LAUNDERING JURISDICTION OVER FOREIGN 
                   PERSONS.

       Section 1956(b) of title 18, United States Code, is 
     amended--
       (1) by redesignating paragraphs (1) and (2) as 
     subparagraphs (A) and (B), respectively,

[[Page S3928]]

     and indenting each subparagraph appropriately;
       (2) by striking ``(b) Whoever'' and inserting the 
     following:
       ``(b) Civil Penalties.--
       ``(1) In general.--Whoever''; and
       (3) by adding at the end the following:
       ``(2) Jurisdiction.--For purposes of adjudicating an action 
     filed or enforcing a penalty ordered under this section, the 
     district courts of the United States shall have jurisdiction 
     over any foreign person, including any financial institution 
     authorized under the laws of a foreign country, that commits 
     an offense under subsection (a) involving a financial 
     transaction that occurs in whole or in part in the United 
     States, if service of process upon such foreign person is 
     made in accordance with the Federal Rules of Civil Procedure 
     or the laws of the foreign country in which the foreign 
     person is found.
       ``(3) Satisfaction of judgment.--In any action described in 
     paragraph (2), the court may issue a pretrial restraining 
     order or take any other action necessary to ensure that any 
     bank account or other property held by the defendant in the 
     United States is available to satisfy a judgment under this 
     section.''.

     SEC. 106. LAUNDERING MONEY THROUGH A FOREIGN BANK.

       Section 1956(c)(6) of title 18, United States Code, is 
     amended to read as follows:
       ``(6) the term `financial institution' includes--
       ``(A) any financial institution described in section 
     5312(a)(2) of title 31, or the regulations promulgated 
     thereunder; and
       ``(B) any foreign bank, as defined in section 1(b)(7) of 
     the International Banking Act of 1978 (12 U.S.C. 3101(7));''.

     SEC. 107. SPECIFIED UNLAWFUL ACTIVITY FOR MONEY LAUNDERING.

       (a) In General.--Section 1956(c)(7) of title 18, United 
     States Code, is amended--
       (1) in subparagraph (B)--
       (A) by striking clause (ii) and inserting the following:
       ``(ii) any act or acts constituting a crime of violence;''; 
     and
       (B) by adding at the end the following:
       ``(iv) fraud, or any scheme to defraud, committed against a 
     foreign government or foreign governmental entity;
       ``(v) bribery of a public official, or the 
     misappropriation, theft, or embezzlement of public funds by 
     or for the benefit of a public official;
       ``(vi) smuggling or export control violations involving 
     munitions listed in the United States Munitions List or 
     technologies with military applications as defined in the 
     Commerce Control List of the Export Administration 
     Regulations; or
       ``(vii) an offense with respect to which the United States 
     would be obligated by a multilateral treaty either to 
     extradite the alleged offender or to submit the case for 
     prosecution, if the offender were found with the territory of 
     the United States;'';
       (2) in subparagraph (D)--
       (A) by inserting ``section 541 (relating to goods falsely 
     classified),'' before ``section 542'';
       (B) by inserting ``section 922(l) (relating to the unlawful 
     importation of firearms), section 924(m) (relating to 
     firearms trafficking),'' before ``section 956'';
       (C) by inserting ``section 1030 (relating to computer fraud 
     and abuse),'' before ``1032''; and
       (D) by inserting ``any felony violation of the Foreign 
     Agents Registration Act of 1938 (22 U.S.C. 611 et seq.),'' 
     before ``or any felony violation of the Foreign Corrupt 
     Practices Act''; and
       (3) in subparagraph (E), by inserting ``the Clean Air Act 
     (42 U.S.C. 6901 et seq.),'' after ``the Safe Drinking Water 
     Act (42 U.S.C. 300f et seq.),''.

     SEC. 108. CRIMINAL FORFEITURE FOR MONEY LAUNDERING 
                   CONSPIRACIES.

       Section 982(a)(1) of title 18, United States Code, is 
     amended by inserting ``or a conspiracy to commit any such 
     offense,'' after ``of this title,''.

     SEC. 109. FUNGIBLE PROPERTY IN FOREIGN BANK ACCOUNTS.

       Section 984(d) of title 18, United States Code, is amended 
     by adding at the end the following:
       ``(3) In this subsection, the term `financial institution' 
     includes a foreign bank, as defined in section 1(b)(7) of the 
     International Banking Act of 1978 (12 U.S.C. 3101(7)).''.

     SEC. 110. SUBPOENAS FOR BANK RECORDS.

       Section 986(a) of title 18, United States Code, is 
     amended--
       (1) by striking ``section 1956, 1957, or 1960 of this 
     title, section 5322 or 5324 of title 31, United States Code'' 
     and inserting ``section 981 of this title'';
       (2) by inserting ``before or'' before ``after''; and
       (3) by striking the last sentence.

     SEC. 111. FUGITIVE DISENTITLEMENT.

       (a) In General.--Chapter 163 of title 28, United States 
     Code, is amended by adding at the end the following:

     ``Sec. 2467. Fugitive disentitlement

       ``Any person who, in order to avoid criminal prosecution, 
     purposely leaves the jurisdiction of the United States, 
     declines to enter or reenter the United States to submit to 
     the jurisdiction of the United States, or otherwise evades 
     the jurisdiction of a court of the United States in which a 
     criminal case is pending against the person, may not use the 
     resources of the courts of the United States in furtherance 
     of a claim in any related civil forfeiture action or a claim 
     in any third-party proceeding in any related criminal 
     forfeiture action.''.
       (b) Conforming Amendment.--The analysis for chapter 163 of 
     title 28, United States Code, is amended by adding at the end 
     the following:

``2467. Fugitive disentitlement.''.

     SEC. 112. ADMISSIBILITY OF FOREIGN BUSINESS RECORDS.

       (a) In General.--Chapter 163 of title 28, United States 
     Code, is amended by adding at the end the following:

     ``Sec. 2468. Foreign records

       ``(a) Definitions.--In this section--
       ``(1) the term `business' includes business, institution, 
     association, profession, occupation, and calling of every 
     kind whether or not conducted for profit;
       ``(2) the term `foreign certification' means a written 
     declaration made and signed in a foreign country by the 
     custodian of a record of regularly conducted activity or 
     another qualified person, that if falsely made, would subject 
     the maker to criminal penalty under the law of that country;
       ``(3) the term `foreign record of regularly conducted 
     activity' means a memorandum, report, record, or data 
     compilation, in any form, of acts, events, conditions, 
     opinions, or diagnoses, maintained in a foreign country; and
       ``(4) the term `official request' means a letter rogatory, 
     a request under an agreement, treaty or convention, or any 
     other request for information or evidence made by a court of 
     the United States or an authority of the United States having 
     law enforcement responsibility, to a court or other authority 
     of a foreign country.
       ``(b) Admissibility.--In a civil proceeding in a court of 
     the United States, including a civil forfeiture proceeding 
     and a proceeding in the United States Claims Court and the 
     United States Tax Court, unless the source of information or 
     the method or circumstances of preparation indicate lack of 
     trustworthiness, a foreign record of regularly conducted 
     activity (or a duplicate of such record), obtained pursuant 
     to an official request, shall not be excluded as evidence by 
     the hearsay rule if a foreign certification, also obtained 
     pursuant to the same official request or subsequent official 
     request that adequately identifies such foreign record, 
     attests that --
       ``(1) the foreign record was made, at or near the time of 
     the occurrence of the matters set forth, by (or from 
     information transmitted by) a person with knowledge of those 
     matters;
       ``(2) the foreign record was kept in the course of a 
     regularly conducted business activity;
       ``(3) the business activity made such a record as a regular 
     practice; and
       ``(4) if the foreign record is not the original, the record 
     is a duplicate of the original.
       ``(c) Foreign Certification.--A foreign certification under 
     this section shall authenticate a record or duplicate 
     described in subsection (b).
       ``(d) Notice.--
       ``(1) In general.--As soon as practicable after a 
     responsive pleading has been filed, a party intending to 
     offer in evidence under this section a foreign record of 
     regularly conducted activity shall provide written notice of 
     that intention to each other party.
       ``(2) Opposition.--A motion opposing admission in evidence 
     of a record under paragraph (1) shall be made by the opposing 
     party and determined by the court before trial. Failure by a 
     party to file such motion before trial shall constitute a 
     waiver of objection to such record, except that the court for 
     cause shown may grant relief from the waiver.''.
       (b) Conforming Amendment.--The analysis for chapter 163 of 
     title 28, United States Code, is amended by adding at the end 
     the following:

``2468. Foreign records.''.

     SEC. 113. CHARGING MONEY LAUNDERING AS A COURSE OF CONDUCT.

       Section 1956(h) of title 18, United States Code, is 
     amended--
       (1) by striking ``(h) Any person'' and inserting the 
     following:
       ``(h) Conspiracy; Multiple Violations.--
       ``(1) Conspiracy.--Any person''; and
       (2) by adding at the end the following:
       ``(2) Multiple violations.--Any person who commits multiple 
     violations of this section or section 1957 that are part of 
     the same scheme or continuing course of conduct may be 
     charged, at the election of the Government, in a single count 
     in an indictment or information.''.

     SEC. 114. VENUE IN MONEY LAUNDERING CASES.

       Section 1956 of title 18, United States Code, is amended by 
     adding at the end the following:
       ``(i) Venue.--
       ``(1) In general.--Except as provided in paragraph (2), a 
     prosecution for an offense under this section or section 1957 
     may be brought in any district in which the financial or 
     monetary transaction is conducted, or in which a prosecution 
     for the underlying specified unlawful activity could be 
     brought.
       ``(2) Exception.--A prosecution for an attempt or 
     conspiracy offense under this section or section 1957 may be 
     brought in the district in which venue would lie for the 
     completed offense under paragraph (1), or in any other 
     district in which an act in furtherance of the attempt or 
     conspiracy took place.''.

[[Page S3929]]

     SEC. 115. TECHNICAL AMENDMENT TO RESTORE WIRETAP AUTHORITY 
                   FOR CERTAIN MONEY LAUNDERING OFFENSES.

       Section 2516(1)(g) of title 18, United States Code, is 
     amended by striking ``of title 31, United States Code 
     (dealing with the reporting of currency transactions)'' and 
     inserting ``or 5324 of title 31 (dealing with the reporting 
     and illegal structuring of currency transactions)''.
  TITLE II--DRUG TESTING AND INTERVENTION FOR INMATES AND PROBATIONERS

     SEC. 201. SHORT TITLE.

       This title may be cited as the ``Combatting Drugs in 
     Prisons Act of 1998''.

     SEC. 202. ADDITIONAL REQUIREMENTS FOR THE USE OF FUNDS UNDER 
                   THE VIOLENT OFFENDER INCARCERATION AND TRUTH-
                   IN-SENTENCING INCENTIVE GRANT PROGRAMS.

       Section 20105(b) of the Violent Crime Control and Law 
     Enforcement Act of 1994 (42 U.S.C. 13705(b)) is amended--
       (1) by striking ``(b) To be eligible'' and inserting the 
     following:
       ``(b) Additional Requirements.--
       ``(1) Eligibility for a grant.--To be eligible'';
       (2) by striking ``a State shall provide assurances'' and 
     inserting the following: ``a State shall--
       ``(A) provide assurances'';
       (3) by striking the period at the end and inserting ``; 
     and''; and
       (4) by adding at the end the following:
       ``(B) not later than September 1, 1998, have established 
     and implemented, consistent with guidelines issued by the 
     Attorney General, a program of drug testing and intervention 
     for appropriate categories of convicted offenders during 
     periods of incarceration and criminal justice supervision, 
     with sanctions (including denial or revocation of release) 
     for positive drug tests.
       ``(2) Use of funds.--Notwithstanding section 20102, amounts 
     received by a State pursuant to section 20103 or section 
     20104 may be--
       ``(A) applied to the cost of offender drug testing and 
     appropriate intervention programs during periods of 
     incarceration and criminal justice supervision, consistent 
     with guidelines issued by the Attorney General;
       ``(B) used by a State to pay the costs of providing to the 
     Attorney General a baseline study, which shall be consistent 
     with guidelines issued by the Attorney General, on the prison 
     drug abuse problem in the State; and
       ``(C) used by a State to develop policies, practices, or 
     laws establishing, in accordance with guidelines issued by 
     the Attorney General, a system of sanctions and penalties to 
     address drug trafficking within and into correctional 
     facilities under the jurisdiction of the State.''.

     SEC. 203. USE OF RESIDENTIAL SUBSTANCE ABUSE TREATMENT GRANTS 
                   TO PROVIDE FOR SERVICES DURING AND AFTER 
                   INCARCERATION.

       Section 1901 of part S of the Omnibus Crime Control and 
     Safe Streets Act of 1968 (42 U.S.C. 3796ff) is amended by 
     adding at the end the following:
       ``(c) Additional Use of Funds.--Each State that 
     demonstrates that the State has established 1 or more 
     residential substance abuse treatment programs that meet the 
     requirements of this part may use amounts made available 
     under this part for drug treatment and to impose appropriate 
     sanctions for positive drug tests, both during incarceration 
     and after release.''.
                                  ____

  Mr. DASCHLE. Mr. President, drug trafficking, money laundering and 
drug use in prisons are significant problems that will continue to 
worsen unless local, state and federal governments can work more 
closely together to determine viable solutions. Drug trafficking and 
money laundering can negatively affect our society in many different 
ways, and the use of illegal drugs by prison inmates dramatically 
deceases any chance they have of getting their lives back on track 
after their release. Local, state and federal governments are already 
hard at work to determine solutions to these corrosive problems, and I 
am very pleased to join Senators Leahy, Cleland, Feinstein, and Kohl in 
introducing The Money Laundering Enforcement and Combating Drugs in 
Prison Act of 1998, which will provide state and federal governments 
with additional tools to fight drug trafficking, money laundering and 
drug use in prisons.
  This legislation will complement the Administration's comprehensive 
10-year National Drug Control Strategy by providing federal prosecutors 
with additional means to seize assets linked to illegal criminal and 
drug activity and prevent drug kingpins and others from engaging in 
money laundering. Initiatives such as the Safe and Drug Free Schools 
Act, and the Administration's highly effective radio and TV ads 
currently airing in 12 pilot cities are sending the kind of anti-drug 
messages that must reach our young people. The Money Laundering 
Enforcement and Combating Drugs in Prison Act of 1998 adds to these 
efforts by reducing the demand for drugs by allowing states to use 
federal prison grant funds to test and treat drug-addicted inmates and 
parolees.
  This legislation will greatly enhance the efforts of prosecutors to 
force international criminals out of hiding by reducing their ability 
to shield themselves behind foreign banking laws or use other 
procedural tricks. Moreover, the bill will ensure that defendants 
arrested overseas will no longer be able to take advantage of U.S. 
courts to fight against extradition to this country. It would allow 
federal prosecutors to temporarily seize U.S. assets owned by 
individuals arrested overseas and thus dramatically improve the ability 
of law enforcement agencies to shut down drug trafficking operation 
based outside the United States. Drug kingpins have little regard for 
nation boundaries, and our nations laws must provide us with the 
flexibility necessary to combat them.
  Studies prove that an overwhelming majority of incarcerated 
individuals have been heavily influenced by drugs or alcohol, and those 
who are illegal drug or alcohol abusers are the most likely to be 
repeat offenders. If we want to stem the increase in our nation's 
prison population, we must determine which inmates are addicted to 
drugs or alcohol, reduce the availability of drugs in prisons and 
ensure inmates have access to the treatment they need while 
incarcerated. This legislation will help states meet all these goals by 
allowing them to use as much--or as little--of the federal prison funds 
they receive for drug testing and intervention and to develop a 
strategy to reduce drug trafficking in prisons.
  State and federal governments are waging a battle against drug 
kingpins, and the Money Laundering Enforcement and Combating Drugs in 
Prison Act of 1998 will provide much-needed assistance to these ongoing 
efforts. By enacting this bill, I believe we will make great strides 
toward removing dangerous criminals and illegal drugs from our 
neighborhoods. I urge my colleagues to join me in support of this 
important legislation.
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