CARTELS KEEPING AHEAD IN SHELL GAME WITH DRUG MONEY

U.S. Authorities Say Trail Is Hard To Track

WASHINGTON -- Despite the weakening of the Arellano Felix leadership
in Tijuana two years ago, U.S. authorities haven't been able to track
all the drug cartels' money.

"I'm not happy with the ability we have so far demonstrated in going
after the money, given the amount of drugs and revenue estimates,"
John Walters, head of the White House Office of National Drug Control
Policy, said in a recent interview. "We do not have a very good
picture how the money is flowing."

For years, the Arellano cartel, based in Tijuana, controlled about 60
percent of the drug trafficking at the U.S. border. The cartel was
responsible for hundreds of slayings, authorities have said.

But the cartel's grip on drug routes in Baja California was loosened
considerably when its leaders were toppled.

The cartel's top enforcer, Ramon Arellano Felix, was killed in a
shootout with police in Mazatlan on Feb. 10, 2002. The cartel's boss,
Benjamin Arellano Felix, was arrested in Puebla, Mexico, a month after
his brother's death.

U.S. Drug Enforcement Administration officials, who declined to be
identified, agreed with Walters.

The officials blamed two primary factors: The lack of proper
intelligence to determine the scope of the cartels' wealth, and the
increasing use of cash by the cartels to elude the federal banking
systems.

Many of the cartels over the years have laundered their money through
hotels, businesses and various corporate entities.

Money laundering moves funds through a variety of accounts to disguise
income from crimes, such as drug trafficking. Some U.S. banks have
assisted in the laundering of drug money, according to congressional
committee investigations. Money laundering has been illegal in the
United States since 1986.

After the U.S. government cracked down on laundering through banks,
many cartels are increasingly using cash to avoid detection, officials
said.

Over the years, the United States has worked with other countries to
unravel the money sources of drug-trafficking organizations. In the
1990s, an investigation into the Cali mafia in Colombia led to 200
arrests and the seizure of more than $50 million in cash.

Still, drug investigators say it's difficult to halt complex schemes.

The Arellano cartel, for example, operates largely in cash and hides
its resources in myriad businesses, a DEA official said.

"When someone gets killed or arrested, other family members take over
as caretakers of the organization," said a DEA official, who declined
to be identified. "We don't have a complete picture, because most of
the money is in cash."

Walters said U.S. officials are trying to improve how they estimate
the cartels' drug profits. U.S. officials are building theoretical
models to duplicate potential money-laundering operations. And they
are trying to get more information about the specifics of the
drug-trafficking operations from suspects they've arrested.

In the meantime, Walters said he is pleased with the Mexican
government's effort to break up the cartels.

Top leaders of cartels "have been arrested in unprecedented numbers
across major and multiple organizations," Walters said.