ILLEGAL MONEY LAUNDERING SUPPORTS GLOBAL CRIME

WASHINGTON -- Federal investigators are widening their search for
suspects in the terrorist attacks on the World Trade Center and
Pentagon by creating financial profiles of the hijackers aboard the
commercial jetliners.

``We will explore the financial relationships that may exist between
them and other terrorist entities,'' Treasury Undersecretary Jimmy
Gurule said Thursday. ``We are optimistic that this strategic
approach to identifying terrorism's funding sources will expand to
include substantial international cooperation.''

A Bush administration report this week cited one estimate that
illegal money laundering accounts for $600 billion to $1.8 trillion
of the world's annual economic activity.

Question: What is money laundering?

Answer: Profits from illegal activity, for example, the sale of
cocaine, are disguised and funneled into other uses. In the case of
terrorists, the origin of the money may not be illegal, but it is
secretly moved for illegal use.

Q: What role did it play in the terrorist attacks on the World Trade
Center and Pentagon?

A: The terrorists needed money to carry out their plan. They
purchased plane tickets with money that may be traced to the
organization they were members of. They also rented cars and paid for
hotel rooms and leased apartments. They spent tens of thousands of
dollars on pilot lessons so they could fly the commercial airliners.
Investigators think there were dozens of other people -- perhaps more
- -- in their support group.

Q: How does money laundering work?

A: According to the international Financial Action Task Force on
Money Laundering, the money is introduced into the financial system
often in small amounts. Then a series of transactions are made to
distance the money from its source by perhaps wiring money to
different accounts around the globe in nations that do not
participate in international anti-money laundering efforts. ``The
launderer then moves them to the third stage -- integration -- in
which the funds re-enter the legitimate economy,'' states IFATF. Drug
kingpins might use the money for real estate investments or to buy
businesses.

Q: What is the United States doing to combat money laundering?

A: The Bank Secrecy Act requires banks to report financially
suspicious activities to the government. These reports helped state
and local law enforcement personnel pursue 10,950 investigations last
year. Federal regulators also have asked banks to check on names and
Social Security numbers of suspected terrorists involved in last
week's attack.

The Treasury Department said its new Foreign Terrorist Asset Tracking
Center will play a major role in preventing a repeat of last week's
attack by denying access to financial assets, impairing fund-raising
by terrorist groups and isolating and incapacitating them, said
Deputy Assistant Secretary Rob Nichols.

The Treasury Department also has another agency, the Financial Crimes
Enforcement Network, which coordinates investigations with other law
enforcement agencies such as the FBI and U.S. Customs Service.
Multi-agency investigations are being run through HIFCA (High
Intensity Money Laundering and Related Financial Crimes Area) task
forces. Two new task forces are being formed in the Chicago area and
northern California.

But former federal prosecutor Charles Intriago, a money-laundering
expert based in Miami, said federal law enforcement officials have
not fully tracked down financial leads they developed during the
investigation of the 1993 World Trade Center bombing. Nor has the
government effectively tracked the financial assets of the 200 known
terrorist organizations listed on a federal government Web site, said
Intriago.

Q: Is there international assistance?

A: The United States is one of 53 nations that belong to the Egmont
Group, an informal international financial intelligence network that
can rapidly exchange information. The organization is named after
Egmont-Arenburg Palace in Brussels, which was the site of the 1995
meeting where the group was formed.

Q: What nations are considered safe havens for money laundering?

A: The Financial Action Task Force, a 29-nation alliance that
includes the United States, announced in June that 17 countries or
governments are uncooperative, including 11 holdovers from last year
- -- the Cook Islands, Dominica, Israel, Lebanon, Marshall Islands,
Nauru, Niue, the Philippines, Russia, St. Kitts & Nevis, and St.
Vincent & the Grenadines. The six new additions to this list of
so-called ``non-cooperative countries'' were Burma, Egypt, Guatemala,
Hungary, Indonesia, and Nigeria. Four others -- the Bahamas, the
Cayman Islands, Liechtenstein and Panama -- were on last year's list
and taken off. Based on the number of suspicious activity reports
filed by U.S. banks, Russia was the biggest single source of the
problem.

Q: What more is the federal government considering doing?

A: Draft anti-terrorism legislation being circulated on Capitol Hill
by the White House would toughen existing criminal laws on asset
seizure to specifically include terrorist activity -- current law
doesn't -- and to allow the seizure and freezing of substitute
assets. Financial crimes committed abroad could be prosecuted if the
proceeds show up in the United States.

On the regulatory front, new reporting requirements for stock
brokerages, check cashing locations, casinos and foreign banks with
U.S. accounts are in the works, but critics say the administration is
moving too slowly. A regulation requiring check cashing and wire
transfer businesses to report all suspicious activity beginning Jan.
1 is being postponed by the Bush administration to October 2002.