The financial version of Fast and Furious. What a bunch of idiot incompetents

U.S. launders drug profits for probe

Undercover U.S. narcotics agents have laundered or smuggled millions of dollars in drug proceeds as part of Washington's expanding role in Mexico's fight against drug cartels, according to current and former federal law enforcement officials.

The agents, primarily with the Drug Enforcement Administration, have handled shipments of hundreds of thousands of dollars in illegal cash across borders, those officials said, to identify how criminal organizations move their money, where they keep their assets and, most importantly, who their leaders are.

They said agents had deposited the drug proceeds in accounts designated by traffickers, or in shell accounts set up by agents.

The officials said while the DEA conducted such operations in other countries, it began doing so in Mexico only in the past few years. The high-risk activities raise delicate questions about the agency's effectiveness in bringing down drug kingpins, underscore diplomatic concerns about Mexican sovereignty and blur the line between surveillance and facilitating crime. As it launders drug money, the agency often allows cartels to continue their operations over months or even years before making seizures or arrests.

Agency officials declined to publicly discuss details of their work, citing concerns about compromising their investigations. But Michael S. Vigil, a former senior agency official, said, "We tried to make sure there was always close supervision of these operations so that we were accomplishing our objectives, and agents weren't laundering money for the sake of laundering money."

Another former agency official, who asked not to be identified speaking publicly about delicate operations, said, "My rule was that if we are going to launder money, we better show results, otherwise the DEA could wind up being the largest money launderer in the business, and that money results in violence and deaths."

In operations supervised by the Justice Department and orchestrated to get around sovereignty restrictions, the United States is running numerous undercover laundering investigations against Mexico's most powerful cartels. One DEA official said it was not unusual for U.S. agents to pick up two or three loads of Mexican drug money each week. A second official said as Mexican cartels extended their operations from Latin America to Africa, Europe and the Middle East, the reach of the operations had grown as well. When asked how much money had been laundered as a part of the operations, the official would only say, "A lot."

The former official said federal law enforcement agencies had to seek Justice Department approval to launder amounts greater than $10 million in any single operation. But they said the cap was treated more as a guideline than a rule, and that it had had been waived on many occasions to attract the interest of high-value criminal targets.

It is not clear whether such operations are worth the risks. So far there are few signs that following the money has disrupted the cartel's operations, and little evidence that Mexican drug traffickers are feeling any serious financial pain. Last year, the DEA seized about $1 billion in cash and drug assets, while Mexico seized an estimated $26 million in money laundering investigations, a tiny fraction of the estimated $18 billion to $39 billion in drug money that flows between the countries each year.