FBIS4-67292 "jptdd022__l94057"
JPRS-TDD-94-022-L JPRS Narcotics 19 May 1994
EAST ASIA THAILAND

Editorial Urges Government Action Against Money Laundering

Editorial Urges Government Action Against Money Laundering BK1905052594 Bangkok BANGKOK POST in English 19 May 94 p 4 BK1905052594 Bangkok BANGKOK POST English BFN [Editorial: "Time to clean up the dirty laundry"] [Text] Last week in Taiwan, police broke up a heroin sales operation. The drugs were made in Burma, and sold in Taiwan by Singaporeans. The managers of the heroin ring were Hong Kong triad members who live in Thailand. Drugs entered Taiwan aboard ships of various nationality, sent mixed among other cargo by Bangkok transport agencies. Operations were masterminded across international satellite telephone connections, and profits were banked somewhere, although police are not yet sure where. This was, authorities point out, only a "small" smuggling operation responsible for dumping an estimated 50 kilograms of heroin per month on hapless addicts in Taiwan. It is no wonder, then, that leaders of the international Financial Action Task Force (FATF) were in town last week pushing for new laws to combat drug smuggling. National police forces, up against an organized foe which is both sophisticated and ruthless, are losing the battle against addictive drugs. The international scope of the narcotics business is obvious. It is equally plain that drug traffickers only can be combated through international cooperation. Thailand must consider accepting the call of the world community to enact new, tough laws against money laundering. FATF is a five-year-old group with a growing membership, funded by the G-7, of the world's second richest nations. It is mainly a lobbying group, formed to convince countries and bankers alike that it is in their own interest to monitor huge flows of cash. By watching where such money goes, FATF and its backers argue, big time drug dealers can be identified, investigated and ultimately put out of business. It is a compelling argument to beleaguered anti-narcotics agents. FATF President John Gieve told our officials it also should be attractive to the very people involved--our bankers. "A country or a center which wishes to attract the top names will find it easier to do so if they have in place anti-money laundering legislation," Mr Gieve said. Some read this statement as a threat. But it is, instead, a promise. Cash transactions with banks are becoming ever more tightly controlled throughout the world. Even where banking is traditionally secretive and protective of the customer, such as in Switzerland, large transfers now are routinely reported to the police if the banks have any suspicion about their origin. Banks and nations which cooperate in anti-laundering efforts get more international business when they enter the financial centers. Efforts to combat drugs kingpins have more and more targeted their fortunes. Sales of narcotics are performed with cash for a variety of reasons, just as most legitimate commerce is done more and more with paper. Warlords have assembled armies which outgun most police forces, but the bosses of the drug gangs must convert their profits. Money laundering is aimed at converting "dirty money" from drugs into "legitimate money," which then can be used for any purpose--even for buying entire governments. Anti-laundering laws are the legal version of the famous Watergate maxim on how to catch villains: "Follow the money." A huge cash deposit may be attractive to a banker. But unless he knows the businessman making the deposit, money-laundering laws require him to report the transaction to authorities. This opens up a new line of inquiry to authorities. If written carefully and enforced without favor, such laws will not affect honest citizens, and will enhance the reputation of banks which participate. Clearly, no inroads will be made against major drug trafficking without international cooperation and effort. Already, neighbors such as Australia, Japan Hong Kong and Singapore have passed tough anti-laundering laws, without harm to the business of their banks nor the privacy of their people. Unquestionably, the Government must consider such legislation carefully, and seek advice both from other countries and our own judicial experts before acting. But action on money-laundering must be taken soon. Because Thailand is a front-line drugs state, the Government must take the responsibility of acting. Drug use already harms our country badly in many areas, from the spread of AIDS through massive corruption and countless petty crimes by desperate addicts. Because it is close to the production centers in Burma and Laos, Thailand also attracts major traffickers. Our country, and our banks, are healthy enough to reject drugs money. The Thai Government should take action to make the country increasingly unattractive for drug traffickers. A careful, but tough, anti-laundering law would mark a major step in such an effort.