draining development.pdf - Khazar University

Illicit Capital Flows and Money Laundering in Colombia 155lence of testaferros (front or straw men), prosecutors have to investigatetraffickers and all their family members.In 2004, with the encouragement and support of the United States,Colombia changed its traditional justice system to an accusatory one.The shift to the new system has not been easy, and many lawyers, judges,and prosecutors do not understand the new system. Many young judgesare not well qualified, do not understand money laundering issues, andshould be trained. High personnel turnover is another problem becauseit means there must be regular training programs. These have been themain reasons for the large backlog of cases.Officials of the United Nations Office on Drugs and Crime believethat there is a pressing need to improve the quality of justice system personnel.15 They think that personnel problems are behind a decliningtrend in AML convictions. They also think that the quality of the dataavailable on judicial processes are poor. The government agenciesinvolved in fighting money laundering have provided information to thejudicial system for prosecutions. However, no information is availableabout what goes on during the processes.The National Narcotics Directorate (DNE) is in charge of administeringseized assets and forfeitures, but faces great challenges. Its record inadministering, managing, and disposing of seized goods has been questionableat best. DNE regularly encounters problems because of the titlesof seized properties. Frequently, the relevant records have disappeared.Because of these problems, DNE has opted to accept assets for managementonly after formal precautionary measures have been completed.DNE currently manages assets in several special categories: chemicalsubstances; urban real estate; rural real estate; land vehicles; airplanes;boats; cash, art, and other; and businesses. DNE decides how to disposeof the forfeited assets. Both DNE and the Fiscalía have had great difficultyseparating front men from good faith asset holders. They knowthat a large share of the seized assets is in the hands of front men, but thisis difficult to prove. Another problem arises because many assets are notproductive, but must be stored and maintained and therefore generatesubstantial cash outflows. Others require special skills to be managedproperly.By the end of November 2008, DNE had received 80,860 assets tomanage, while the forfeiture processes were advancing. Of these, 12,397