Corrupt Officials.(Latin America)

The plague of money laundering in Latin America is of breathtaking proportions. According to Charles Intriago, a former U.S. federal prosecutor who publishes the authoritative monthly newsletter Money Laundering Alert, an estimated $5 billion in U.S. real estate has been acquired by corrupt Latin American officials, politicians and their associates. U.S. authorities have tied drug-related laundered funds to officials in former Mexican president Carlos Salinas de Gortari's government, to cite one prominent example. Complex money trails were always hard to follow, but the fight against global terrorists has now given U.S. investigators unprecedented freedom to probe the financial dealings of prominent officials around the world.

Last August, under the aegis of the Department of Homeland Security, the United States quietly created a Miami-based financial task force that, for the first time, specifically targets the sources of public corruption and bribery in foreign countries. The unit is now pursuing at least nine cases in Latin America, according to Anthony Arico, chief of the task force. About 50 new amendments written into the 2001 Patriot Act have radically eased the burden of proof for U.S. investigators. Among other things, the amendments now make foreign corruption a so-called predicate crime for money laundering, raising the possibility that sovereign banking laws may not offer the same protections to secretive account holders as they once did.

The new legal framework has been quickly put to use. Following leads in Nicaragua, U.S. Customs Service agents recently opened an investigation of former Nicaraguan tax-authority chief Byron Jerez and his ex-boss, former Nicaraguan president Arnoldo Aleman. Last month the United States seized a $2.7 million condominium on Key Biscayne, Florida, they say is owned by Jerez, along with $150,000 from an account he had in a U.S. bank. Jerez was found guilty on criminal charges including fraud last summer in Nicaragua, but his conviction was overturned in part in December. The prosecutor is appealing and Jerez is free pending the appeal. A Nicaraguan judge last year sentenced Aleman to 20 years under house arrest on charges of fraud, embezzlement and criminal association. Aleman has appealed the conviction, and ...