HOUSE, CLINTON AIDES WORKING ON DRUG BILL

Sanctions Against Traffickers To Be Expanded

WASHINGTON-- Congress is close to forcing a major expansion of economic
sanctions against international narcotics traffickers and the businesses
that work with them.

Legislation to impose such sanctions on drug criminals throughout the world
passed the Senate easily late last month. After initially opposing the
measures on both practical and foreign policy grounds, administration
officials have now begun to work with legislators to fashion a bill that
both the House and the president could support.

But while such measures have some support among businessmen and government
officials in Colombia -- the only country where the United States has used
them -- they are being strongly opposed by the government of Mexico and a
few of that country's biggest companies.

"The Mexican government has repeatedly expressed profound concern about the
negative consequences that may arise from the implementation of such a
proposal," Mexico's ambassador to Washington, Jesus Reyes Heroles, wrote on
July 27 in a confidential letter to the White House drug-policy director,
Gen. Barry McCaffrey.

The sanctions would bar drug traffickers and their associates from doing
business in the United States, cut off their access to U.S. banks and
freeze assets they may have deposited here.

U.S. firms that continue to work with companies linked to the traffickers
would be subject to civil and criminal prosecution. President Clinton first
levied such penalties in 1995 against the four leaders of Colombia's Cali
drug cartel.

In a subsequent letter to Congress, he promised, "I shall continue to
exercise the powers at my disposal to apply economic sanctions against
significant foreign narcotics traffickers and their violent and corrupting
activities as long as these measures are appropriate."

Since then, the Treasury Department, which administers the sanctions, has
built a list of almost 500 relatives, associates and mostly Colombian
companies linked to the traffickers. More than two dozen of those companies
have ended up liquidating their assets, officials said, while others have
had to reorganize or change their names.

But administration officials have hesitated almost from the start to extend
it to drug criminals in other countries, and particularly to those in Mexico.

In part, their concerns have been practical. The most powerful Mexican drug
mafias are believed to have hidden their wealth in mazes of front
companies, aliases and associates that the U.S. authorities have not yet
been able to penetrate.