Pubdate: Tue, 30 Mar 1999
Source: Washington Times (DC)
Copyright: 1999 News World Communications, Inc.
Contact:  http://www.washtimes.com/

2 MEXICAN BANKS ADMIT GUILT IN MONEY-LAUNDERING CASE

Two Mexican banks charged in a U.S. undercover investigation that
targeted suspected smugglers and money launderers for cocaine cartels
in Colombia and  Mexico have agreed to plead guilty and pay millions
of dollars in fines.

The banks, Bancomer and Banca Serfin, which were among three Mexican
banks named by the U.S. Customs Service in the undercover
investigation known as "Operation Casablanca," reached an agreement
this week with U.S. prosecutors that will keep several top officials
out of jail, law enforcement authorities said.

The third bank, Banca Confia, agreed to a civil resolution and, the
sources said, will also pay millions in fines. All three are expected
to enter pleas in U.S. District Court in Los Angeles as early as today.

The 30-month undercover Customs probe has been described as the
largest money-laundering investigation in U.S. history. It resulted in
the arrest of more than 160 persons and the seizure of more than $50
million in illicit drug  profits. Agents also seized 2 tons of cocaine
and 4 tons of marijuana.

The banks were accused of being involved in the illicit laundering of
drug  profits. The probe also identified four Venezuelan banks as
having laundered  $9.5 million in drug profits. They were identified
as Banco del Caribe, Banco  Industriale de Venezuela, International
Finance Bank and Banco Consolidado.

In addition, officials at 12 Mexican banks were named in the
indictments, including 19 executives at Confia, Bancomer and Banca
Serfin.

The undercover probe, which strained U.S.-Mexico relations, began in
November 1995 and established for the first time a direct link between
the cartels and Mexican and Venezuelan banks and bank officials in the
laundering of illicit profits. Money laundering is a process enabling
drug traffickers to  convert illegal proceeds into useable funds.

The probe showed that Mexican and Colombian traffickers and money
brokers had given undercover agents instructions and contacts on how
to pick up drug  proceeds from couriers in designated cities and
return the cash to Los Angeles,  where it was deposited in undercover
accounts.

The money was then wired to foreign accounts established by Mexican
bankers, who knew it was from narcotics trafficking. The Mexican
bankers then issued  drafts in fictitious names, per instructions from
the undercover agents, and  mailed or hand-delivered them to
undercover agents in Los Angeles.

The bank drafts were deposited into undercover accounts, and the money
was then wired to accounts designated by the traffickers and money
brokers, or personally delivered to the traffickers or brokers in
Mexico or Colombia.

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