COMMISSION ON NARCOTIC DRUGS ACTING AS PREPARATORY BODY FOR THE SPECIAL SESSION OF THE GENERAL ASSEMBLY OF THE UNITED NATIONS

ITEM No.3: FIGHT AGAINST MONEY LAUNDERING

Vienna, 7-9 October

Statement by the Transnational Radical Party

Mr Chairman,

Having been very attentive to the different aspects of the drugs problem for a long time, The Transnational Radical Party states that as a result of the supra-national impetus since the beginning of the 1980s, the fight against drugs has grown to include the fight against money laundering, with quite disappointing results.

The international community has thrown its heart and soul into this fight. It began from the declaration of the Bâle Committee and the United Nations convention of 19th December 1988, closely followed by the Council of Europe Convention of 8th November 1990 and the forty recommendations of the GA-FI.These were followed by a series of regional instruments, whose aim was for each to be more impressive than the next. The phenomenon of laundering led to a galloping inflation of repression which never managed to meet its assigned objectives. Astronomical sums of money were and are still being devoured everywhere in order to sometimes assure the prevention and sometimes the repression of this spreading phenomenon. Nobody has ever been able to estimate the actual amounts of laundered money that exist. This is not surprising if we keep as the definition of laundering the fact of wanting to give legitimacy to all produce (goods or capital) of crime. What we are talking about here is the fight against something of whi

ch we do not know the size and scope. Some people estimate that $500 billion, and others $1000 billion, is laundered every year on a world-wide level. The 1996 United Nations Report on Drugs tells us that the sale of illegal drugs represents 8% of the world economy. 8% of the world economy has been laundered or is going to be.

If the aim of depriving the criminals of the fruits of their crimes, which is the main motivation of the Commission, appears to be a criminal policy of dissuasion worthy of interest, we still need to ensure that precise limits are imposed. Those who want too much end up with nothing at all and the preachers in the fight against money laundering seem to be led astray. The rules of laundering are not only reduced to a simple exercise of morality, they impose economic and social costs which must be examined on par with their benefits to society.

At its 8th Session, the GA-FI has notably enriched its work programme with a project on the estimation of laundering. Such an analysis is not of any real interest unless it is appears in conjunction with an analysis of the costs of the fight against this illicit activity.

Blanket repression often only leads to criminal movements, look at the growing extension and professionalisation of criminal networks. It is this that we are assisting with the laundering phenomenon. The control of financial systems leads to a shifting of laundering activities towards other non-financial activities under their own control. In addition, new technologies of payment, the electronic systems of transferal of funds (SWIFT) mean that it is now impossible to trace flows of laundered money. This money which could have been otherwise reintegrated in part in to the legal economy, today is mainly used to support the expenditure of this game of hide and seek. It is necessary to fully take into account the anticipational capacity of criminal enterprises. The growing emphasis that the police place on criminal financial activities force them to set up smoke screens around their illegal activities with the help of financial specialists, such as expert accountants and fiscal advisors.

We can investigate the following paradox: Following the pattern of the fight against drug trafficking, the fight against laundering seems to show a sensitive rise of this phenomenon. The symbolic interactionists have proved with great clarity, that the believing in the reality of a phenomenon can result in the existence of its tangible outline. Our contemporary beliefs make our world a world of trafickants and launderers.

To stop this disaster, the Transnational Radical Party considers as urgent, Mr. Chairman, that the Commission on Narcotic Drugs proposes to the General Assembly the following measures:

- the setting up of a cost-benefit analysis of the fight against laundering, comparing the losses to an economy from this black money, with the costs of the implementation of current policies in order to curb these activities.

- to target human and financial investments in the direction of proven crime rather than in the direction of potential criminality to avoid a repressive diversion towards all sorts of acts.

- to limit the confiscation of goods which we know results in an offence due to a previous conviction.

Let us finish, Mr. Chairman, by reminding you, in the hope that sooner or later a fundamental debate can be opened up in the heart of the international authorities, that the real reason is, and remains that of the prohibition of drugs which directly and automatically leads to the business of organised crime which, aswe said earlier, represents 8% of the world economy.

We do not believe it to be superfluous, at this time, to remember that money coming from the trade of narcotic substances which are sold legally, like alcohol or tobacco, do not make up laundered money, it is not the money which destabilises our economies.

We hope that this simple consideration will leave you with something to reflect on, more so than a simple figure or statistic, the political realities of the issues of drugs and of laundering.

I thank you Mr. Chairman.