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Drug Money Flies Into Miami Daily, Prosecutors Say

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The Associated Press

Published: February 16, 2008

MIAMI - Every day, American Airlines Flight 914 takes off from Bogota, Colombia, at 8:20 a.m. and touches down at the Miami airport at noon. In the jet's cargo hold are usually bags and bags of euros that investigators say are part of a huge $1.4 billion cocaine money-laundering scheme.

Crime is happening right on schedule in Miami, almost every day, federal prosecutors say. But so far, despite nearly four years of investigation, they apparently have been unable to build a strong enough case to stop it.

Instead, they are attacking the problem piecemeal. The U.S. Justice Department this week went to federal court in Miami seeking forfeiture of nearly $11 million seized last June and July by federal agents, who used drug-sniffing dogs to find cocaine residue on some of the cash.

The money represents only a tiny fraction of a huge scheme to launder euros from the sale of Colombian cocaine in Europe, Justice Department attorney Lea Carlisle said in the document. She said the total coming through U.S. airports could reach 1 billion euros a year, or about $1.4 billion at current exchange rates.

"This seizure represents a small but telling snapshot," Carlisle said.

Cocaine Profitable In Europe

The arrangement involves money exchange businesses in Colombia, commercial jetliners from the United States and Britain and financial firms in Miami and London.

Vast quantities of cocaine are smuggled each year from Colombia to Spain and sold throughout Europe. The U.S. Drug Enforcement Administration says cocaine sells in Europe for twice what it brings in this country, generating large amounts of cash.

"All of this means they have a new problem - laundering their euros," said Bruce Bagley, an expert on drug trafficking and chairman of international studies at the University of Miami. "This new problem has led them to these complex daisy-chain money laundering activities."

Huge amounts of cash are moved around the globe all the time, most of it legitimate. But the DEA, Justice Department and U.S. Immigration and Customs Enforcement began investigating in 2004 after agents noticed astronomical amounts of euro notes coming into Miami from Bogota.

Still, no business or person has been charged with a crime. Convicting someone requires proof beyond a reasonable doubt.

Moreover, to search a bulk cash shipment, U.S. investigators need a warrant. And they cannot get one unless they can show probable cause to think it's dirty money.

Government Is 'Behind The Curve'

Bagley said the lack of criminal charges is a sign that investigators have yet to build enough evidence against any conspirators.

"The U.S. government is behind the curve on this," Bagley said. "This is a test case to see how far they can get."

According to the U.S. government, here is how the laundering scheme works:

Euro notes generated by cocaine sales in Europe are smuggled illegally into Colombia. Then, couriers known as "smurfs" bring the cash in small amounts to a number of Colombian money exchanges known as "casas de cambio," or "houses of exchange."

The Colombian exchanges then fly the euros to the United States. A good chunk of the money arrives aboard American Flight 914 each day under an arrangement with a Miami-based exchange business, InterTransfers Inc.

In Miami, the euros are transferred by armored car, counted, repackaged and put on a flight to London, where they are converted into dollars and eventually transferred back through Miami and on to Colombia. Ultimately, they become "clean" pesos for the cocaine traffickers, according to the court filing.

Neither InterTransfers nor American, nor any of their employees, has been accused of wrongdoing. American spokesman Tim Smith said the airline has "distinct security procedures" for currency shipments but declined to discuss them.

"American Airlines assists law enforcement authorities in any way possible any time we are asked to in cases such as this," Smith said.

Ramiro Miqueli, InterTransfers president and chief executive, said his company has been assured by the Justice Department that it is not a target of the investigation. He said about $1.5 million of the firm's money seized last summer is being returned without fine or penalty.

"InterTransfers has been found not to have violated any U.S. law," Miqueli said.

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