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Mexico's Senate approves bill to fight money-laundering epidemic

October 11, 2012 |  6:28 pm

Cash seized

MEXICO CITY -- Mexico’s Senate on Thursday unanimously approved an anti-money laundering bill in  hope of stemming a multibillion-dollar tide of illicit cash that flows from the nation’s powerful drug cartels and has seeped into nearly every corner of the Mexican economy.

The bill, which was approved this year  by the lower chamber, has been under consideration for more than two years in the Mexican Congress and could help the struggling nation in its fight against the narco gangs. Although  the outgoing administration of Felipe Calderon has managed to kill or capture more than two-thirds of the country’s most-wanted drug capos, it has struggled to hit them in their bank accounts.

Calderon, who leaves office in December, has long supported a stronger anti-laundering statute, and on Thursday -- a day when Amnesty International was criticizing him for failing to have taken more effective action to stem human-rights abuses committed in his six-year fight against the narcos -- the president sent a tweet congratulating the legislators.

“This will allow us to cut the economic resources of organized crime,” he wrote. “This is big news.”

The bill, which now heads to the president's desk for his signature, establishes a new specialized prosecution unit to go after money launderers and lays out a number of new reporting requirements for major transactions. Casinos will have to report big-money bets, and charity groups will have to inform the government of particularly generous donations. The sale of expensive boats, cars,  airplanes and jewelry also must be reported.

Among other things, the bill will prohibit the use of cash in many real-estate transactions, require banks to flag big credit card bills and force Mexican notaries, who handle most real-estate deals here, to report suspicious activity.

U.S. officials estimate that Mexican drug cartels send $19 billion to $29 billion in ill-gotten cash from the United States to their home country every year, and some Mexican officials have put the annual  of laundered money at $50 billion, representing a staggering 3% of the legitimate  Mexican economy.

As with many reform efforts in Mexico, passing a law will \help only so much. To make a real dent in the drug trade, it also must be enforced. Observers have suggested that the government has neglected to crack down hard on money laundering for fear that it would damage the rest of the economy.

Mexico approved an asset-forfeiture law in 2008 similar to ones in Italy and Colombia that made a big difference in their fights against organized crime, allowing the governments to seize and sell ill-gotten properties. But Mexican prosecutors have used the 2008 law sparingly.

-- Richard Fausset and Cecilia Sanchez

ALSO:

International banks have aided Mexican drug gangs

U.S. blacklisting seems to have little consequence in Mexico

Cartels use legitimate trade to launder money, U.S., Mexico say

Photo: Soldiers carry a table loaded with seized U.S. dollars at a media presentation in Mexico  City last year. The cache of $15.3 million found in a car in downtown Tijuana is believed by authorities to belong to members of the Sinaloa drug cartel. Credit: Eduardo Verdugo / Associated Press

 

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