[Congressional Record Volume 144, Number 147 (Thursday, October 15, 1998)]
[Senate]
[Pages S12625-S12627]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STRATEGY TO COMBAT MONEY LAUNDERING AND RELATED FINANCIAL CRIMES
Mr. CRAIG. Mr. President, I ask unanimous consent that the Senate
proceed to the immediate consideration of H.R. 1756, which was received
from the House.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:
A bill (H.R. 1756) to amend chapter 53 of title 31, United
States Code, to require the development and implementation by
the Secretary of the Treasury of a national money laundering
and related financial crimes strategy to combat money
laundering and related financial crimes, and for other
purposes.
The PRESIDING OFFICER. Is there objection to the immediate
consideration of the bill?
There being no objection, the Senate proceeded to consider the bill.
Amendment No. 3828
(Purpose: To amend the definition of ``money laundering and related
financial crimes'')
Mr. CRAIG. Mr. President, Senators Grassley and D'Amato have an
amendment to the desk.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:
The Senator from Idaho (Mr. Craig), for Mr. Grassley, for
himself and Mr. D'Amato, proposes an amendment numbered 3828.
On page 2, strike line 21 and all that follows through page
3, line 3 and insert the following:
``(2) Money laundering and related financial crime.--The
term `money laundering and related financial crime'--
``(A) means the movement of illicit cash or cash equivalent
proceeds into, out of, or through the United States, or into,
out of, or through United States financial institutions, as
defined in section 5312 of title 31, United States Code; or
``(B) has the meaning given that term (or the term used for
an equivalent offense) under State and local criminal
statutes pertaining to the movement of illicit cash or cash
equivalent proceeds.''.
Mr. GRASSLEY. Mr. President, I am pleased today to see this historic
piece
[[Page S12626]]
of legislation will pass the Senate. After much careful work with
Senator D'Amato, the Treasury Department, and the Justice Department,
as well as our colleagues in the other body, we have crafted a bill
that I believe will lead to much improved coordination in fighting
money laundering. I want to thank everyone involved for their hard work
on this legislation.
The bill will hit the criminals where they feel it the most--in their
pocketbooks. By implementing a strategy on a national level, hundreds
of communities across our country will no longer be held hostage by
these criminal enterprises. As you know, money laundering involves
disguising financial assets so they can be used without detection of
the illegal activity that produced them. Through money laundering, the
criminal transforms the monetary proceeds derived from the criminal
activity into funds with an apparently legal source. Money laundering
provides the resources from drug dealers, terrorists, arms dealers, and
other criminals to operate and expand their criminal enterprises.
Today, experts estimate that money laundering has grown into a $500
billion problem worldwide.
The Money Laundering and Related Financial Crimes Strategy Act of
1998 will authorize the Secretary of the Treasury, in consultation with
the Attorney General and other relevant agencies, to coordinate and
implement a national strategy to address the exploitation of our
Nation's payment systems to facilitate money laundering and related
financial crimes. I look forward to the delivery of this first strategy
next February, and believe it will be a valuable document not only for
law enforcement agencies, but also for Congress as we look to react to
the increasingly inventive ways criminals take advantage of our
financial system. I hope this legislation will be the beginning of a
serious effort by Congress to impact the growing threat of money
laundering not only to our Nation, but worldwide.
Mr. D'AMATO. Today, Mr. President, I urge my colleagues to support
the passage of H.R. 1756, the Money Laundering and Financial Crimes
Strategy Act of 1997. I am glad that we have been able to reach this
point. The House has sent over H.R. 1756, a strong antimoney laundering
tool for law enforcement, and after some negotiation, we have amended
the language slightly. The House has agreed to accept the compromise
and I have a letter from James E. Johnson, Under Secretary for
Enforcement at the Treasury Department supporting the goals of this
legislation. I ask unanimous consent that the letter be printed in the
Record at the conclusion of my remarks.
The PRESIDING OFFICER. Without objection, it is so ordered.
(See exhibit 1.)
Mr. D'AMATO. I believe we are now ready to proceed to passage of the
bill providing sufficient time for the House to act.
Mr. President, this is an important tool for the counternarcotics
effort. Drug traffickers and dealers are destroying our families,
communities and the future of our children, and we must fight them
with Every weapon at our disposal. This bill will attack drug
traffickers by making it harder for these criminals to profit from
their illegal windfalls.
Mr. President, through money laundering, drug traffickers are able to
take their blood money and launder it clean. Their ill gotten gains are
then filtered throughout our economy. Money laundering sustains drug
traffickers and arms dealers, as well as terrorists and other criminals
searching for a way to prolong their illegal enterprises.
That is why I joined with Senator Grassley and Congresswoman
Velazquez to develop the Money Laundering and Financial Crimes Strategy
Act which the House passed on October 5, 1998. The bill will provide
the means for federal, state and local crime fighters to pursue and
prosecute the drug traffickers and those that finance their criminal
trade.
This bill will allow the Secretary of the Treasury and the Attorney
General to create a national money laundering strategy and designate
high risk zones. State and local officials within these zones will be
encouraged to form a task force and become eligible for enforcement and
technical assistance and, most importantly, anti-money laundering
grants.
Mr. President, let me explain why this is especially important for
New York, where money launderers have benefited from the financial,
trade and transportation systems in the metropolitan area. New York is
the largest financial center in this country--and one of the top three
international money centers in the world. Unfortunately, money
launderers have used this infrastructure to pursue their own criminal
activities.
Assistance by state and local officers in New York has been
invaluable in stopping drug traffickers from sending money back to the
cartels. In 1997, in the New York area, law enforcement officials
determined that organized narcotics traffickers were using the services
of unscrupulous money remitters and their agents to send the proceeds
of drug sales back to the drug source countries.
Utilizing a temporary Geographical Targeting Order (GTO) for the New
York metropolitan area, remitters and agents were required to report
detailed information about the remittances of cash to Colombia of more
than $750.
Within a week of the GTO's issuance, the local, state and federal
agencies that made up the El Dorado Task Force found that money
laundering activity in that area, Jackson Heights, dropped
dramatically. The number of remittances to Colombia dropped 95 percent
and the dollar amount dropped 97 percent (from $67 million to $2
million). The New York GTO resulted in the seizure of millions in
currency that was diverted to bulk shipments through the air and
seaports and most importantly, disrupted the profit back to the drug
cartels.
Mr. President, this operation was a huge success--thanks to the
cooperative efforts of federal, state and local law enforcement. We
should build on that cooperation with this legislation.
Law enforcement efforts must follow the financial schemes and cash
flows of the drug traffickers. As the drug cartels change their method
of laundering their proceeds, law enforcement must respond. This bill
provides law enforcement and prosecutors with the resources and
flexibility to do just that. This monumental effort will cripple the
drug traffickers where it hurts--in their pockets--and take an
important step forward in our war on drugs.
I am proud to have cosponsored the Senate measure with Senator
Grassley and to have worked with Representative Velazquez to enact this
important tool in antidrug efforts.
I urge my colleagues to support this important anticrime bill.
Exhibit 1
Department of the Treasury,
Washington, DC, October 8, 1998.
Hon. Alfonse D'Amato,
Chairman, Senate Committee on Banking, Housing, and Urban
Affairs, Washington, DC.
Dear Mr. Chairman: During the course of this year we have
been following a bill introduced by Congresswoman Velazquez,
the ``Money Laundering and Related Financial Crimes Strategy
Act'' (H.R. 1756). On June 16, the Treasury Department
provided testimony on H.R. 1756 indicating support for the
bill's overall goals and objectives.
We continue to support these goals. We appreciate that
Congresswoman Velazquez's bill recognizes the scope of the
money laundering problem, and attempts to develop a mechanism
to address these challenges. Developing an anti-money
laundering strategy could prove useful in setting priorities
and communicating them to Congress and the public. Moreover,
money laundering enforcement is complex and resource-
intensive. Enforcement of money laundering laws could benefit
from proper coordination among federal, state, and local law
enforcement.
We also appreciate the bill's goal of providing additional
resources for state and local antimoney laundering
activities. Financial crime investigations are complex and
require specialized expertise, as well as resource
commitments to follow leads that often take time to develop.
Cases themselves may span years and are information-
intensive. Because of this, state and local law enforcement
could benefit from additional resources and expertise to
fully join the fight against money laundering.
We look forward to continuing to work with you and your
Committee in combating money laundering and other financial
crimes.
Sincerely,
James E. Johnson,
Under Secretary (Enforcement).
Mr. CRAIG. Mr. President, I ask unanimous consent that amendment be
agreed to, the bill considered read a third time and passed, the motion
to reconsider be laid upon the table, and any statements relating to
the bill be printed in the Record.
[[Page S12627]]
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment (No. 3828) was agreed to.
The bill (H.R. 1756), as amended, was passed.
____________________