Bill to Combat Drug Traffic Caught in Lobbying Battle

WASHINGTON -- Efforts by the Republican chairman of the Senate intelligence
committee to soften a bill that would expand economic sanctions against
drug traffickers and the businesses that work with them have touched off a
furious dispute on Capitol Hill.

Such sanctions were imposed by presidential order in 1995 against four
groups who were said to be the biggest cocaine traffickers in Colombia. The
new legislation would extend sanctions to traffickers worldwide.

Aides to the committee chairman, Senator Richard C. Shelby of Alabama, say
he is merely trying to fix flawed legislation that might allow overzealous
government officials to seize the assets of legitimate companies tied to
drug trafficking by scant evidence.

But some of Shelby's fellow Republicans have taken unusually vehement
exception to his stance, suggesting that opponents of the law have been
influenced by Washington lobbyists working for companies that might be
affected by the legislation.

"We have discovered in this Congress that we are not insulated by the
efforts of the kingpins to buy influence and corrupt our political
institutions," Representative Bill McCollum of Florida, a Republican member
of the House intelligence committee, said on the floor shortly before the
legislation passed overwhelmingly Tuesday night. "Their narco-lobbyists
were paid well to try to shape and gut this bill."

McCollum did not mention Shelby or name any of the lobbyists.

Despite the strong support in the House, the bill has run into trouble in
the Senate, where Senator Shelby and a few of his colleagues, including the
Democratic vice chairman of the intelligence panel, Bob Kerrey of Nebraska,
have raised objections.

Aides to Senator Shelby said he would like to see the bill amended so
potential targets of the law would have strong protection. Assets should
not be seized, for example, without a legal finding that the companies were
deliberately involved in the drug trade. Shelby also wants provisions that
could protect the assets of owners or subsidiaries of drug-trafficking
concerns that are not themselves connected to the drug trade.

Opposition to the bill has been directed by some of Washington's most
powerful law firms, according to Congressional aides who have been the
subject of their lobbying.

The most prominent firm, Verner, Liipfert, Bernhard, McPherson & Hand --
which employs Bob Dole, the former Senate majority leader and Republican
presidential candidate -- has been hired by Transportacion Maritima
Mexicana, the biggest transit company in Mexico. The company has fought
vigorously to clear its name after news accounts quoted United States
intelligence reports tying it to the drug trade.

John Merrigan, a partner at Verner, Liipfert, said his client had been put
in the impossible position of having to refute untrue reports based on
anonymous sources.

"We have been proposing in every forum, at every stage, that this
legislation provide for the full prosecution of drug traffickers and their
associates," Merrigan said.

"On the other hand, we have serious concerns that the bill may not even
provide minimal due process, judicial review or other reasonable
protections for innocent companies," he said.

He acknowledged that his firm had paid particular attention to Shelby and
other members of the Senate intelligence committee.

Senator Shelby declined to answer questions about the legislation, his role
in it or the dismissal of a staff member who said he had lost his job
because he opposed the senator's efforts to reshape or block the bill.

Shelby referred questions to his press secretary, Andrea Andrews, who said
it was "completely untrue" that his objections were based in anything but
the desire to improve a faulty bill. As for the dismissed committee staff
member, J. K. Stinebower, she said, "The primary reasons for his dismissal
had nothing to do with this legislation."

Stinebower played an important role in drafting the bill and pushing it
forward. He said he was dismissed for continuing to try to produce a tough
bill after Senator Shelby changed his views.

"I was fired for my work in initiating and drafting the bill," Stinebower
said. "The phrase they used was my 'failure to follow the priorities and
directives of the chairman.' "

He said he was also accused of abusing his annual leave.

Senator Paul Coverdell, Republican of Georgia, a principal sponsor of the
legislation, said it was "being bottled up" by concerns voiced by Senator
Shelby and Senator Pat Roberts, a Kansas Republican who also sits on the
Senate intelligence committee.

No public hearings have been held on the legislation, which was passed as a
separate bill in the House and is attached to a Senate bill authorizing
intelligence activities.

Senator Kerrey, the ranking Democrat on the intelligence committee, said
public hearings should be held to determine the bill's potential impact on
trade. Mexican business have expressed concern that companies unknowingly
associated with others connected to drug-running might be damaged by the law.

Kerrey disputed the notion that lobbyists -- "K Street," in Washington
shorthand -- were steering the bill. "The idea that K Street is rolling us
is false," he said.

The legislation looked like it was sailing through the Senate until late in
September. Then, according to Republican and Democratic members of
Congress, a new draft version appeared from Senator Shelby's office.

"It suddenly appeared about a month ago," Senator Coverdell said. "I know
that Verner, Liipfert has been involved, promoting language that we feel
nullifies the legislation -- that makes it not work."

Documents circulated in Congress by the firm and provided by Congressional
aides advocate changes similar to those proposed by Shelby.

The key element, Senator Coverdell and other members of Congress said, was
language in the bill that said a target of the law would have to be a
"knowing, willful and intentional" drug trafficker and that the target
could go to court to keep the government from invoking the law.

These changes, according to Treasury Department officials and supporters of
the bill, would make it unworkable. And a staff member of Congress involved
in the process called the influence of the lobbyists and their clients on
the bill "one of the smelliest things I've ever seen, if not the smelliest."

The issues in question may be subtler than the accusations of influence,
however. They include free trade, intelligence, the American
counternarcotics effort and the interplay of law and lobbying. The way they
play out will be determined by negotiations between the Senate and the
House in coming days.