DRUG MONEY FREEZE

Exposing Tijuana Cartel's Financial Fronts

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No part of Mexico's uneven law enforcement against drug traffickers and
their cartels is weaker than the effort to police money laundering.
Practically speaking, that effort in Mexico has been almost nonexistent.

All the more reason, then, to applaud the Bush administration's strike
freezing the U.S. financial assets of some two dozen Baja California
businesses and individuals. All are strongly suspected of having financial
ties to the Tijuana-based Arellano Felix drug cartel.

The Treasury Department action was authorized by legislation that Sen.
Dianne Feinstein, D-Calif., helped to write. As she and the legislation's
other authors intended, what the Treasury Department did imposed at least
some financial costs on these Baja businesses. They include the Farmacia
Vida Suprema chain, the Administradora de Inmuebles Vida real estate
company, the Oasis Beach Resort and Convention Center in Rosarito Beach,
and a Tijuana parking lot company owned by the family of Baja California's
tourism secretary, Alejandro Moreno Medina.

Treasury Department officials believe these and the other Baja businesses
whose U.S. assets were frozen have been acting as money-laundering fronts
for the Arellano-Felix Organization.

Identifying and shutting down these suspected fronts imposes a triple cost
on the drug traffickers, in this case the notorious AFO.

=46irst, it penalizes those drug-trade collaborators whose money laundering
activities aid and abet the traffickers. Second, it effectively confiscates
some AFO financial assets on this side of the border. Third, it forces the
AFO to find new money laundering outlets even as the unwelcome glare of
publicity makes recruiting launderers more difficult.

Two additional consequences are noteworthy.

This will greatly increase pressure on Mexico's federal officials to move
against drug money launderers, many of whom have been operating flagrantly
and with seeming immunity for many years. The Treasury Department's action
also will serve to embarrass some in Tijuana who, frankly, need to be
embarrassed.

The AFO makes billions of dollars a year shipping tons of cocaine and
marijuana, plus heroin and methamphetamine across the U.S.-Mexico border.
That money must be laundered before it can be used in more open ways to
enrich the Arellanos and expand their drug-trafficking empire. It has been
an open secret in Tijuana for years that some Baja businesses are de facto
appendages of the Arellanos' drug-trafficking syndicate.

The Arellanos' violent, vicious criminal empire won't be dismembered and
defeated until its financial collaborators have been targeted by law
enforcement, on both sides of the border.

Kudos to the Bush administration and the U.S. Treasury Department for
moving against the AFO money laundering it could identify. Kudos, too, to
Sen. Feinstein for helping to give Treasury the added legal muscle it needed.

It now remains for Mexican authorities to take their own enforcement
action, and for U.S. law enforcement to shut down more of the AFO empire's
cross-border financial links.