THE WHITE HOUSE
Office of the Press Secretary (Cartagena, Colombia) ________________________________________________________________________ For Immediate Release August 30, 2000
Cooperation Between the United States and Colombia on Programs to Counter Money Laundering and Counterfeiting
Today, the United States and Colombia signed a multilateral agreement with Aruba and Panama to establish an international task force to counter the money laundering that occurs through the Black Market Peso Exchange (BPME). The BPME is the largest money laundering conduit in the Western Hemisphere and the primary money laundering conduit used by Colombian drug cartels. Anecdotal law enforcement evidence, informant statements and other evidence suggest that at least $3 to 6 billion is laundered annually using the BMPE system. Brokers who operate the BMPE routinely facilitate multi-million dollar transactions outside Colombia's legitimate financial system.
The BMPE money laundering system involves the Colombian cartels selling U.S. drug dollars to black market peso brokers in Colombia who, with their agents based in the United States, place the dollars into U.S. bank accounts while trying to circumvent the Bank Secrecy Act (BSA) reporting requirements. The peso brokers use monetary instruments drawn on those banks to pay for the merchandise on behalf of Colombian black market importers. To conceal the illegal purchase of the goods and to circumvent Colombia's import regulations and duties, these importers then smuggle the goods into Colombia and sell them on the black market.
The new task force will develop policy options and recommend enforcement actions that can be taken to effectively detect, deter, and prosecute BMPE money laundering. It will also enhance the flow of law enforcement information among those countries most directly affected by the BMPE.
The Clinton Administration has made combating the BMPE a law enforcement priority and an integral component of its National Money Laundering Strategy 2000. Concerted efforts by the Departments of the Treasury and Justice, working closely with Colombia's National Tax and Customs Directorate (DIAN), have achieved tangible results. In one recent initiative, sixty individuals were arrested and approximately $26 million in drug proceeds were targeted for seizure.
The United States also continues to work closely with Colombia to address the problem of counterfeit currency. Colombian manufactured counterfeit dollars represents one-third of all counterfeit passed in the United States. Estimates indicate that over the past fifteen years more than $100 million in Colombian counterfeit has been passed, with $22 million seized in the United States. During the same time period, over $67 million has been seized overseas, with 90% of that total seized in Colombia. The total counterfeit activity attributed to Colombia is over $196 million since 1986.
The U.S. Secret Service, which is charged with counterfeit investigation, has reported an increase in the dual importation of counterfeit currency and illegal drugs into the United States. Ongoing investigations in Colombia reveal that organized criminal groups are operating multiple schemes within their criminal enterprise, and are using the same courier network for both counterfeiting and drug trafficking. Information provided by Colombian law enforcement and military sources indicates that many of the organized groups who operate the contraband manufacturing and smuggling networks originate from areas controlled by the Revolutionary Armed Forces of Colombia (FARC) and the National Liberation Army (ELN).
The U.S. Secret Service has worked effectively with its Colombian counterparts over the last several years to address this significant crime problem. Key initiatives include: provision of training to personnel of the Colombian Administrative Department of Security (DAS) and the Colombian Department of Investigations, Justice and Intelligence (DIJIN) responsible for anti-counterfeiting enforcement; passage of a new anti-counterfeiting law by the Colombian Congress in July 2000; and various successful joint operations.
A recent example of the close cooperation between U.S. and Colombian law enforcement in this area came on August 15, 2000 when Colombian authorities, working with the U.S. Secret Service, captured ten leaders of a major counterfeiting ring that had exported $40 million in fake bills to the United States over the last two years. These arrests shut down what had been the world's largest counterfeit operation.
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