DRUG LIST FUELS FEAR OF GUILTY BY ASSOCIATION

WASHINGTON - The Clinton administration is trying to put the financial
squeeze on the world's biggest drug kingpins, but there are fears
innocent people and businesses could get caught in the wringer. The
administration is required, under legislation approved last year, to
provide Congress by today with a list of who it considers to be the
top foreign drug traffickers.

The people on the list - and their foreign business associates - would
have their US assets frozen in most cases. Americans would be barred
from doing business with them.

Representative Porter J. Goss, chairman of the House Permanent Select
Committee on Intelligence, said the move will hit drug traffickers
''where it really hurts.'' Civil libertarians, however, express
concern that assets will be seized before foreign companies have a
chance to defend themselves. Some US and foreign companies say they
will be penalized for unwittingly doing business with
traffickers.

Though they support the Foreign Drug Kingpin Designation Act, Mexico's
leaders fear their critics in Congress could use the list to create a
''scandalous political atmosphere,'' said Juan Rebolledo, Mexico's
undersecretary of foreign relations.

Senator Paul D. Coverdell, who sponsored the legislation, said the
''angst'' about the list will probably calm after its release.
Coverdell, a Republican from Georgia, said the list will for the most
part be comprised of people ''already under indictment in the United
States.'' A senior administration official said that the first part of
the list - the names of major drug traffickers - was being reviewed
yesterday by President Clinton in Lisbon, where he was meeting with
European Union leaders. Those names will be released today and the
traffickers' assets will be frozen immediately, the official said,
speaking on condition of anonymity. The other part of the list, naming
the traffickers' business associates, was being prepared by the
Treasury Department's Office of Foreign Assets Control, but it was
unclear when it would be made public. The list could contain names of
suspects who have been publicly identified before, such as Alejandro
Bernal Madrigal of Colombia, the Arellano Felix brothers in Mexico,
Wei Hsueh-kang, a Chinese national, and former Myanmar warlord Khun
Sa.

Naming business associates has raised greater concerns. TMM, a giant
Mexican shipping company that has long fought rumors linking it to
drug trafficking, hired a Washington firm to lobby on its behalf. TMM
spokesman Luis Calvillo said the company is now reassured that the US
government ''has taken the adequate steps to make sure that innocents
aren't hurt.'' The United States-Mexico Chamber of Commerce says it
remains troubled that businesses linked to drug trafficking would have
to fight in federal court to clear their names.

''It doesn't really enforce the concept of innocent until proven
guilty,'' said Jeff Sparshott, spokesman for the chamber.

Supporters of the law note that it was modeled after a 1995 executive
order that gave the government the power to penalize Colombian drug
traffickers and their associates. Few due-process complaints have been
raised over the blocking of Colombian assets, they say.

Also, a five-member commission has been formed to evaluate the
procedure of blocking assets and judicial remedies available to anyone
affected by the legislation.