Mexican bulk cash
This week, a smuggler carrying $3.6 million and a large quantity of jewelry was caught by Mexican army troops in Tijuana, a Mexican border city near San Diego, California.
While the recession hits normal people, drug lords and their money launderers still have their unique challenge: how to get huge amounts of street money to the final destination. The first step is usually to change it into large bills and move it for payments of merchandise, guns, staff, bribes or deposit the cash into bank accounts. Easier said than done.
Officials at the DEA’s Office of Financial Operations estimate that 90% of the money transferred from the United States to Latin American suppliers of drugs leaves the U.S. as cash. Drug traffickers transfer $8 billion to $24 billion to Mexico each year, according to authorities. Although it is easier to smuggle the loot in $100 bills, DEA thinks that the actual smuggling usually involves $20 bills (with $20 bills, $1 million weighs 110 pounds) and that the exchange to larger denominations occurs in Mexico. Probably this has to do with transaction reporting requirements in the US, and with the bigger ‘corporate influence’ and availability of mules and strawmen in Mexico.
Mexico’s government has, however, been working with the US Department of Treasury since 2005, which has produced some results over time, most noted in the significantly increased number of money laundering investigations in Mexico in 2009, at 450. 450? Indeed, that does not seem like a lot.
In Mexico itself, although law enforcement encounters considerable resistance from local drug lords and even from within its own ranks, every now and huge cash seizures do take place. Remember the largest one that was ever published? Over $205 million in cash was found in a house of a Chinese-born pharmaceuticals importer in Mexico City during a meth related bust in 2007 .
According to DHS, a recent batch of large-scale cash seizures near the U.S.-Mexico border demonstrates a boost in readiness and attention to money trafficking activities in response to the current drug war raging in Mexico. “Our agents and officers, working together with local law enforcement agencies, are preventing millions of dollars from crossing the border into Mexico,” said Secretary Napolitano. “In stopping the funds that fuel the drug war, we will stifle cartel activity in the United States while helping our neighbors to the south by cracking down on illegal cash before it gets there.”
While money laundering in the layering and integration phase is usually an invisible crime, these huge cash seizures remind us of one of the weakest link in the drug money laundering chain; movement and placement of cash. Let alone the huge feeling of accomplishment if you take bags full of cash away from the perps. A small drop in a big bucket?
http://financialcrimeonline.com/archives/196
http://financialcrimeonline.com/archives/16
http://www.narcoticnews.com/Photos/Money/Mexico/Pics_Cash_Mexico_205million_dollars.html
http://www.dhs.gov/ynews/releases/pr_1236893337026.shtm
http://www.latimes.com/la-fg-meth17mar17,0,709967.story?page=2
http://www.cbp.gov/xp/cgov/newsroom/news_releases/march_2009/03202009_5.xml
http://www.laht.com/article.asp?ArticleId=339688&CategoryId=14091
http://www.isn.ethz.ch/isn/Current-Affairs/Security-Watch/Detail/?lng=en&id=99115
The problem with improving our ability to prevent that $8 – $24 billion from getting into Mexico is that it dramatically increases the cartel’s incentive to set themselves up in our country.
We do NOT want those butchers establishing themselves in our cities. The cartels murder 6,000+ people a year in order to protect their drug incomes. Right now it’s not our loved ones being murdered, let’s keep it that way!
We need to urgently implement the *only* policy capable of ending the cartel murders. Because two-thirds of the cartels’ incomes come solely from marijuana the only policy capable of destroying the cartels is to legalize the production and sale of marijuana to adults. Undercut their prices, take their customers away from them and we’ll eliminate their marijuana incomes and end their ability and incentive to continue murdering thousands of people every year.