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U.S. DEPARTMENT OF STATE
INTERNATIONAL NARCOTICS CONTROL STRATEGY REPORT MARCH 1996:
FINANCIAL CRIMES AND MONEY LAUNDERING
United States Department of State
Bureau for International Narcotics and Law Enforcement Affairs
TREATIES AND AGREEMENTS
Mutual legal assistance treaties (MLATs) which are negotiated by the
Department of State in cooperation with the Department of Justice to
facilitate cooperation in criminal matters, including money laundering
and asset forfeiture, are in force with 19 governments including:
Argentina, the Bahamas, Canada, Italy, Jamaica, Mexico, the Netherlands,
Panama, Switzerland, Turkey, the United Kingdom with respect to its
Caribbean dependent territories (the Cayman Islands, Anguilla, British
Virgin Islands, the Turks and Caicos Islands and Montserrat), Uruguay,
Morocco, Spain and Thailand. MLATs have been signed but not brought
into force with eight other governments: Belgium, Colombia, United
Kingdom, Korea, Hungary, the Philippines, Austria and Nigeria. Similar
treaties are in various stages of negotiation elsewhere. The US also
has signed the OAS Mutual Legal Assistance Treaty.
In addition, the US has entered into executive agreements on forfeiture
cooperation, including: (1) an agreement with the UK providing for
forfeiture assistance and asset sharing in narcotics cases; (2) a drug-
related forfeiture agreement with Hong Kong; and (3) a forfeiture
cooperation and asset sharing agreement with the Netherlands (but not
yet in effect with Aruba and the Netherlands Antilles). The US has
asset sharing agreements with the Cayman Islands, Colombia, Mexico and
Ecuador.
Financial Information Exchange Agreements (FIEAs) are bilateral
Executive Agreements which facilitate the exchange of currency
transaction information between governments. The FIEA provides a
mechanism for exchanges of such information between Treasury Department
and the other government's Finance Ministry. The ability to quickly
exchange currency transaction information in money laundering matters
aids in achieving mutual enforcement goals. The United States has FIEAs
in effect with Colombia, Ecuador, Panama, Peru, Venezuela, Paraguay, and
Mexico. Each FIEA requires that both parties enact or have legislation
which requires the reporting or recording of large currency transactions
conducted at financial institutions.
On December 2, 1995, the Financial Crimes Enforcement Network (FinCEN)
signed a Memorandum of Understanding (MOU) with the Government of
Argentina. The MOU was formulated within the framework established by
the Summit of the Americas, December 1994, and its Ministerial
Conference Concerning the Laundering of Proceeds and Instrumentalities
of Crime, December, 1995.
The parties agreed to provide each other with general information
relating to money laundering, illicit drug trafficking and related
crimes, including information on trends and patterns involving the
proceeds of drug trafficking or the international transfer of illicit
assets. The parties also agreed to furnish one another with information
about financial transactions, in coordination with appropriate
authorities in each case, involving particular investigations of illicit
activities or operations.
The seven FIEAs currently in effect differ in scope, providing for the
exchange of information in three categories:
(a) Financial transactions associated with money laundering as a result
of narcotics trafficking; or (b) financial transactions associated with
money laundering regardless of source of funds; or, (c) financial
transactions associated with illicit activities, not limited to money
laundering.
Generally, requests for information and information provided must be
case specific, tied to a violation of law, and requested in writing
including as much identifying information as possible. Information
provided must be used only for the purpose requested and not further
disseminated, disclosed, or transmitted without the written approval of
the provider of the information. In urgent circumstances, the FIEA with
Mexico allows for requests to be made by telephone or telefax, followed
by a written request.
Although FIEAs are potentially a highly valuable tool for obtaining
financial transaction information from foreign countries in support of
money laundering investigations, few requests have been made with the
exception of Mexico which has actively used the FIEA to obtain financial
transaction information from the United States in furtherance of its
anti-money laundering efforts.
US Customs has mutual assistance agreements with Argentina, Australia,
Austria, Belarus, Belgium, Canada, Cyprus, Czechoslovakia (now extended
to the Czech Republic and Slovakia), Finland, France, Germany, Greece,
Hungary, Italy, Korea, Mexico, Norway, Poland, Russia, Spain, Sweden,
United Kingdom and Yugoslavia. Customs has negotiated agreements with
other countries that are not yet in force: Denmark and Honduras.
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