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Mexico sets money-laundering whistleblower program
ST. LOUIS, April 6 (Complinet) - The Mexican attorney general's office has created a whistleblower program to reward those who report suspected money laundering, but U.S. enforcement officials voiced skepticism that it will work.
The goal of the program, announced this week, is to attack the pocketbooks of the drug cartels that dominate parts of the country. According to the U.S. government's best estimate, Mexico's drug cartels smuggle tens of billions of dollars, mostly U.S. currency, across the U.S.-Mexico frontier each year.
"The federal government will continue standing up to organized crime throughout the country to ensure that the rule of law prevails over the violent and arbitrary actions of criminals," the Mexican attorney general's office said in a statement.
The cartels' reputation for extreme violence, however, may deter members of the general public from tipping off the authorities, U.S. officials said. They voiced concern that corrupt government officials might help the cartels make examples of whistleblowers, leading to more murders in a country that has seen an estimated 35,000 people killed in drug-related violence since 2006.
"The problem in Mexico, with all the leaks, is that the cartels have relied on devastating brutality to make examples of those who cross them. It could be difficult to entice people to come forward when the possibility of violent retribution is very likely," a senior U.S. law enforcement official told Complinet.
The new program is based on the premise that ordinary Mexicans often witness suspect transactions, but at present have no incentive to tip-off the government.
Now whistleblowers can voice their suspicions in person or via telephone or e-mail. Law enforcers, public officials and bankers will not be eligible for monetary rewards, but others will be able to collect up to one-quarter of any funds ultimately forfeited by criminals.
A special committee will determine how much money an informant is entitled to, once the assets are officially in the government's hands. However, if the assets are something other than bundles of cash, the informant might have to wait for years as the case winds its way through the Mexican courts and the assets are liquidated, anti-money laundering experts told Complinet.
Mexico has no credible witness-protection program, and there is no reason to believe money-laundering informants would have access to the meager protection that does exist.
The cartels have a reputation for murdering those who aid prosecutors. In one such example in December 2009, former federal policeman Edgar Enrique Bayardo was arrested for corruption involving the Sinaloa cartel. He turned state's witness and accepted government protection, only to be gunned down in a Starbucks in Mexico City.
(Editing by Randall Mikkelsen)
(This article was first published in Complinet (www.complinet.com). Complinet, part of ThomsonReuters, is a leading provider of connected risk and compliance information and on-line solutions to the global financial services community.)
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