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interview: dick gregorie

 

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Gregorie is an Assistant United States Attorney in the Southern District of Florida. Among the many drug cases he has prosecuted, the more famous have been those against Colombia's Medellin cartel and against Gen. Manuel Noriega, the former leader of Panama. This is the edited transcript of an interview conducted in 2000.
In your experience, how does the clout of the Mafia, the traditional LCN, compare to drug trafficking organizations that you've run into here in Miami and the Caribbean?

Well, the amounts of money we're talking are so huge that they make the localized Mafia problem look minuscule. Certainly extortion, loan-sharking, and gambling [were very profitable] and the Mafia [needed] to launder those profits. But I don't think that anywhere in the Mafia's greatest dreams did their profits come anywhere near what we had in the drug trade in the 1980s and early 1990s.

How would you illustrate [the difference]?

We have no real accounting of what's there. But [in terms of drug trafficking] we're definitely talking about billions. The Mafia [money] ... was kept within a small group, and therefore not anywhere near the size of the drug trafficking [profits].

How would you describe the size, extent, parameters, of the international narcotics business?

The drug trafficking business has grown into one of the world's largest enterprises--I would say equal with the oil industry or some of the major corporations in the world.

Are you talking about cash?

We are talking about billions of dollars every year in liquid cash.

Would you say they [are] controlling some economies?

They do control economies. I would say the narcotics industry in Colombia is more cash ready than [its] government, or almost any other South American [government].

And here in Florida?

Here in Florida all you need to do is drive down [Brickel] Avenue and look from one side of the street to the other, and you'll see bank after bank after bank. Take a look up--you don't see any smokestacks. There is no industry here to speak of. What we have here is hundreds of international banking organizations [working with] money which is really drug capital and narcotics proceeds.

You have been involved in drug prosecutions over the past 20 years. [How has the industry changed?]

It got more sophisticated. ...The money laundering end of the narcotics business has been infused by the Russian Mafia, Israeli organized crime figures, [and] sophisticated banking organizations. Essentially the narcotics traffickers have [evolved] from dragging suitcases full of money into banks, to being able to [launder] money through sophisticated accounts, and hide it in real estate purchases, stock transactions, [and] jewelry sales that are very hard to trace.

...I remember the story about a bank guard who was standing on the corner, and he watches a man roll up and try to pull several suitcases out of a cab. One of the suitcases bursts open and money falls out. Another car pulls up, the guy is trying to put the money back into the suitcase, and two armed men come out and steal the suitcases. And the guard runs over to the man and says, "I'm going to call the police, I'll get the police here right away." And the man says, "No, no, don't call the police," gets back in the car and drives away.

Well, that was the basis of money laundering in those days. They would take the cash proceeds from all these narcotics sales, and they would bring it to the bank. Bank employees would sit in the cellar counting bill after bill after bill and put it into someone's bank account, which then would get wire transferred to Colombia.

They've [become] far more sophisticated than that now. The bank employees no longer have to sit in the basement counting the bills. They now have very sophisticated counting machines, which will pull out the counterfeit money and will count the money at great speed. [The drug traffickers are] able to take it to numerous different accounts, and they [are] able to [launder] the money in a fashion which makes it appear to be legitimate business.

So is the industry inextricably entwined in a legitimate economy?

I don't know...It is certainly entwined with our economy in the sense that it has every intention to appear legitimate. If you dig into some of these companies or businesses, you will see they have no basis for the kinds of money they have.

...When you started out, [the drug traffickers] were literally taking suitcases of cash out of the airport. That's changed over time.

Oh, yes. What's happened is that the money launderers have been able to develop businesses which are cash business, [for example] restaurants...Jewelry has become a great way to launder money. You can buy it here in the U.S., take it down to South America, resell it, and the money is laundered. You can purchase real estate in the United States for an ungodly sum, then...sell it back to someone in South America, and the money is laundered.

If you go and look at some of these businesses [throughout Miami], nobody goes in them, nobody goes out of them...We had a baby store that literally had no parking in front of it. Yet when we looked at the receipts, they were recording several million dollars a month going into their accounts. Well, we knew it wasn't from the sale of baby clothes. Nobody could even park there to get in.

When you came down here 18 years ago you felt overwhelmed. The whole place was awash with cocaine money and traffickers?

It was the Wild West. Now [law enforcement] has become a little more sophisticated, but [we are] still very much [at] the outer edge of narcotics dealing and money laundering.

I hate to say this, Dick, but it doesn't sound like you're winning.

Well, I can't tell you that rape, robbery or mayhem have stopped in the world either. Crime will continue, no matter how strong our efforts are. We have identified the problem, and we certainly have an idea of what to do about it. I'm not sure that government and law enforcement is doing all it can. I would say that sometimes we're more interested in the body count than we are interested in getting to the core of the problem. And sometimes the money laundering is so intertwined with legitimate business that the government doesn't know whether it should really take all the steps it should to stop the money laundering...

So law enforcement loses out to business?

Law enforcement has always taken second place to intelligence operations [and] business concerns. If you are arresting a drug dealer or a mugger on the street, everyone is happy. If you are taking steps to stop the flow of proceeds from crime, and that's going to interfere with banks...or businesses' [ability] to continue their operations in a free-flowing manner, then you're going to run into difficulty.

In 1989 the DEA seized so much money that it actually was self funding.

Yes, and this has become an interesting problem in law enforcement...The agencies become so attuned to seizing money, they make that their objective [and] forget that they are out there to try to stop the problem...

Any number of DEA people we have interviewed say that in their careers, especially in the last 15 years, there has been a push to bust money more than drugs because you can use the money.

I think it is an appropriate objective of law enforcement to be going after the money. They keep growing more narcotics down in South America, and we have decided that it is not appropriate for us to go and wipe out the cocaine fields. So the only way to stop the problem is to take the profit out of it...[The drug dealers] are in this business to make money. And if you make it unprofitable, they will stop dealing in narcotics. The only way to do that is to disturb this flow of funds.

Granted, but the reality is [that if] law enforcement agencies seize money they get to use [it] themselves.

Yes, they're using the money for law enforcement purposes. The problem is that it should not be the sole goal of law enforcement to seize enough money to keep their operations going. Rather, it should be to seize the money in order to stop the narcotics trade. And I think we've lost sight of that.

One DEA supervisor said to us that if you told us the money was going to go to treatment or general education funds for the society at large, we wouldn't be busting the money.

I don't think that's the case. I think that law enforcement has recognized that seizing the money hurts the drug dealers far more than seizing their cocaine. They can always go back to the fields and get more cocaine. If they lose the money it hurts them because they've already gone through...the entire manufacturing and distribution cycle, and now they're waiting for their profit...

But why should the money go back to funding more law enforcement operations that have nothing to do necessarily with drug trafficking?

If law enforcement operations [weren't funded] with the bad guy's drug money, it would come from the taxpayers' pocket. And I think there's a lot to be said for having the drug [dealers] pay for their own prosecution.

Let's talk about the drug kingpin law.

I testified in Congress that the drug kingpins are the ones who are really profiting on a large scale from this industry...Most European and South American countries will not extradite a defendant to the United States for trial if that defendant is going to be put to death. So the statute actually inhibits us...

[We must] realize the world is getting much smaller. Drug dealers can now sit in a foreign jurisdiction and direct drugs to be delivered to a specific street address in the United States [within] a very short period of time. So if we're going to attempt to prosecute those drug kingpins, we must be able to extradite them. Foreign countries won't extradite them if we're going to sentence them to death...and that is a major problem with the statute.

There is a more recent drug kingpin statute which involves companies and industries [that are involved in] any [aspect] of [the] narcotics [industry]...

Oh, and they are supposed to put them out of business in that sense? That certainly is an admirable goal. If they get cooperation from the foreign jurisdictions in doing that, it certainly will be a great assistance.

I think the problem is that these people don't hold money solely in the U.S. If you can seize their money and property in the U.S. and put them out of business, I think that's a great step in the right direction.

So the question has become, to what extent [does] drug money becomes intermingled with legitimate money overseas? As a result you have many foreign companies that have protested or lobbied, particularly Mexican companies, against this law.

Well, I think you've got to make clear to them, if you're in the drug business for a penny, you're in it for a pound. And if you're going to do business with drug dealers, then you're risking your entire business.

So the word ought to be out, and it ought to be made clear to any business, that [if] you do business with drug dealers, you take the chance that you are knowingly taking in drug money, [and] you are risking your entire business.

Some of these companies would say, "We don't know that we're doing business with a drug dealer." For instance this one transportation company in Mexico says, "We can't look in every container. So if that's going to taint us as drug dealers, we'll go out of business unfairly, and our trade with the U.S. will be over."

Well, as I said to you earlier, we have got to take drastic steps in order stop this problem. And if that includes telling companies that they must go to every length possible to ensure that they are not assisting the drug traffickers either by laundering their money or transporting their dope, then we have to do that.

Some of these companies may say, "Well, it's a very difficult task." Well, find a way to do it, because you are part of the problem and...you are going to have to learn to deal with that problem and assist us.

I'm sure the statute says, "knowingly and willingly," so if it is by accident, beyond your knowledge, you can't be guilty of the offense. No one gets convicted for doing something which they are totally unaware of and not responsible for.

No one?

Not intentionally. I will not say that our system is perfect. But I don't know of any drug dealers that are in jail, at least who have come through my watch, that were not dealing in narcotics.

I interviewed the CIA station chief in Panama in 1989, and he said two interesting things. One, there was no reason to invade Panama if what we wanted to do was grab Manuel Noriega. And two, Manuel Noriega wasn't really a drug trafficker. He was involved but he was by no means a drug trafficker.

[If] you listen to that CIA chief, you realize that the intelligence community doesn't understand the criminal law. If you are a business boss sitting in your office directing your employees to traffic in drugs, you can say, "I'm not a drug trafficker. The guy who worked for me was dealing in the drugs, but I wasn't dealing in drugs." You can have other people do your bidding. But what the CIA chief doesn't understand is that [in] Manuel Noreiga's protection of the drug kingpins from Colombia...he was a major drug conspirator.

...Manuel Noriega was a major cog in drug laundering coming from Colombia. He assisted them by laundering money through his banks [using] his bank secrecy laws, and he assisted them by allowing them to transport the drugs through Panama to come to the United States. He was a major player in the narcotics traffic.

Did we have to invade to get him?

Well, we had several choices. He used to pass through U.S. territory, [on] U.S. military bases. They could have picked him up, [and] brought him back to the U.S. Maybe they didn't need to send the troops in. I'm not sure that was politically acceptable. Would the international community have been happier if we had grabbed him on U.S. territory, put him in handcuffs and brought him back to the U.S.? ...I don't believe it would have been satisfactory to the diplomatic community.

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