[Congressional Record Volume 149, Number 160 (Thursday, November 6, 2003)]
[Senate]
[Page S14179]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. GRASSLEY:
  S. 1837. A bill to combat money laundering and terrorist financing 
and for other purposes; to the Committee on the Judiciary.
  Mr. GRASSLEY. Mr. President, I rise to speak in support of a bill 
that I am introducing today, the Combating Money Laundering and 
Terrorist Financing Act of 2003.
  Money laundering is a significant threat to our country because it 
undermines our national security, promotes corruption and funds 
terrorism. Money laundering operations as a whole include such 
mechanisms as structured transactions, wire fraud, over- and under-
invoicing, and other activities designed to defraud and hide profits 
from illegal activities. All of these transactions undermine legitimate 
financial institutions by promoting corruption, funding criminal and 
terrorist operations, and by providing a method of profiting from 
illegal transactions such as drug trafficking and weapons sales.
  We know that money laundering is the functional equivalent of a war 
industry for terrorist groups. Terrorist groups do not function in a 
bubble but will use whatever means available to obtain funding for 
their cause. Our attention and rhetoric are focused on identifying and 
halting those mechanisms used specifically by terrorist organizations 
such as charitable organizations, money service businesses and 
alternative remittance systems which are often referred to as hawalas. 
Frankly, the tools used to launder and disguise funds for terrorist 
organizations are similar, and quite often identical to, those used by 
many drug traffickers and criminal organizations to clean their own 
dirty money.
  No matter how the funds are obtained and ultimately used, they are 
still dirty, and if we are ever going to get ahead of the curve, we 
must design a better way to identify and halt this flow of illegal 
funds. The bill I am introducing today includes several provisions that 
will strengthen our current money laundering and terrorist financing 
laws to enhance our ability to identify and eliminate various avenues 
used to launder money, whether it be for drug traffickers, criminal 
organizations or terrorists.
  This bill adds several provisions to the list of specified unlawful 
activities within the RICO statute that serve as predicates for the 
money laundering statute including: burglary and embezzlement, illegal 
money transmitting businesses, alien smuggling, child exploitation and 
obscenity. It would close a loophole on securities fraud by including 
the purchase of securities with the sale of securities as a money 
laundering offense, and adds the unlawful use of Social Security 
numbers to the list of money laundering offenses.
  It adds a provision to the civil forfeiture statute to include the 
forfeiture of property outside the U.S. territorial boundaries if it 
was used in the planning of the terrorist act that occurred within the 
jurisdiction of the United States and includes a parallel transaction 
provision which provides that all parts of a parallel or dependent 
financial transaction are considered a money laundering offense if one 
part of that transaction involves the proceeds of an unlawful activity.
  Our best response to money laundering and terrorist financing threats 
is a comprehensive and coordinated response which must be laid out in 
an effective strategy. This bill also reauthorizes the National Money 
Laundering and Financial Crimes Strategy Act through 2006. This yearly 
strategy must identify the risks and threats we face. Without a 
comprehensive strategy, we cannot begin to implement laws and 
regulations that will effectively combat money laundering sources and 
shut down the system as a whole. Only when we have a systematic 
approach to money laundering will we be able to avoid the duplication 
and inconsistencies that currently plague our efforts.
  This legislation is important to identifying particular money 
laundering operations and putting them out of business. I encourage you 
to pass this legislation to ensure our national security against the 
continued threat posed by terrorist financing and financial crimes.
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