About | HeinOnline Law Journal Library | HeinOnline Law Journal Library | HeinOnline
LOG IN
LOG IN

47 U.S. Att'ys Bull. 34 (1999)
The Colombia Black Market Peso Exchange

handle is hein.journals/usab47 and id is 165 raw text is: The Colombia Black Market Peso Exchange David Marshall Nissman Assistant United States Attorney District of the Virgin Islands With an estimated 57 billion dollars in drug street sales in the United States annually, a labyrinth of multinational distribution systems, an inability to extradite traffickers from certain countries, and a seemingly insatiable domestic appetite for more controlled substances, American prosecutors wage an uphill battle. At times, we lose sight of the fact that traffickers have three major weaknesses that law enforcement can exploit. The first is in the transportation of their goods. They are going to have to move their drugs to market by planes, trains, cars, trucks, or boats, and when they move, there is always an opportunity to intercept the drugs. The second is in their choice of personnel and our ability to infiltrate the narcotics rings. Former Miami Drug Enforcement Administration Special Agent in Charge Billy Mitchell used to ask his troops what are the three most important tools to a DEA agent? He would answer, informants, informants, informants. As law enforcement agencies have seen time and again, informants can wreak havoc on the best organized drug enterpnses. The third major weakness that traffickers have is in the repatriation of their profits. This article explores one part of that problem and one of the techniques Colombian traffickers are currently using. As we read stories of the lavish lifestyles of cartel leaders in Colombia, recognize that these lifestyles cost a lot of money. Here is something not immediately associated with that image. Lavish lifestyles, and the support of business empires in Colombia, cannot be maintained with U.S. dollars because they are not readily useable in Colombia. The traffickers must find a way to convert dollars into pesos, which cannot be done effectively on street comers. Necessity, being the root of both invention and opportunity, produces a new player in this drama: the money broker. American goods are sought after by legitimate consumers in Colombia. These goods include American made cars, clothing, farm and industrial equipment, liquor, bicycles, stereo equipment, and just about every imaginable product except coffee. American companies prefer to be paid in dollars for obvious reasons. This also applies to other foreign goods sought by the Colombians. For example, when European companies sell goods to Colombia, they also prefer to be paid in dollars. Colombian merchants must then convert their pesos into dollars. Colombian importers go to the Colombian central bank to convert pesos into dollars. Before the bank will process the request, the importer must produce a certification that all required import permits have been acquired. In order to get the permits, the Colombian importer must first pay the taxes and import duties. These taxes and duties are a very important source of revenue for the Colombian government. In legitimate transactions, they amount to about 20 percent of the purchase price of goods. The Money Broker The new player in this international trade, the money broker, performs a service for everyone, except the Colombian government. First, the broker buys dollars from the drug traffickers. Second, the broker buys pesos (with those dollars) from the legitimate Colombian business people, who want to import American goods. Next, the broker helps to arrange the purchase of the 34 UNITED STATES ATTORNEYS' BULLETIN JuNE 1999 34 UNITED STATES ATTORNEYS' BULLETIN JUNE 1999

What Is HeinOnline?

HeinOnline is a subscription-based resource containing thousands of academic and legal journals from inception; complete coverage of government documents such as U.S. Statutes at Large, U.S. Code, Federal Register, Code of Federal Regulations, U.S. Reports, and much more. Documents are image-based, fully searchable PDFs with the authority of print combined with the accessibility of a user-friendly and powerful database. For more information, request a quote or trial for your organization below.



Short-term subscription options include 24 hours, 48 hours, or 1 week to HeinOnline.

Purchase Access

Contact us for annual subscription options:

Contact Us

Already a HeinOnline Subscriber?

Log In

profiles profiles most