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June 10, 2009

Official: Drug lords using 'gift cards' to smuggle money

Posted: 09:50 AM ET
Kiran Chetry - Anchor, CNN's American Morning
Filed under: Drugs • Mexico
Arizona Attorney General Terry Goddard says Mexican drug cartels use gift card technology to smuggle money across the U.S. border.
Arizona Attorney General Terry Goddard says Mexican drug cartels use gift card technology to smuggle money across the U.S. border.

The state of Arizona is finding itself on the front line of the war against Mexican drug cartels. Their attorney general will meet this week with leaders of other southwestern states to try to stop the flow of drugs across the border with Mexico. To do that, they say they will have to stop the flow of cash as well, including a new way smugglers are trying to get past the cash-sniffing dogs.

Lawmakers say gift card technology is now making it easier for drug lords to move cash across the border undetected. These 'stored value instruments' are often issued by offshore banks and allow large sums of money to be moved throughout the world. Arizona Attorney General Terry Goddard spoke to Kiran Chetry on CNN’s “American Morning” Wednesday.

Kiran Chetry: Walk us through these gift cards. How have they become so useful to the drug cartels?

Terry Goddard: This isn't your Starbucks or Best Buy gift cards. What we're talking about here are stored value instruments, which have chips in them…that basically can store fairly large amounts of cash. The total amount is undetermined; it depends on who the depositing bank or financial institution is. As a result, since they're not considered monetary instruments, they can be taken across the border and you don't break any laws. It is a huge loophole in our financial crimes observations.

Chetry: So you're talking about gift cards, these blank cards that can be preloaded with large amounts of cash. How do they cash it in once they get across the border?

Goddard: These basically are your passport for cash. They are your way of getting into a financial institution. If you're buying coffee with them, obviously your return is not that big. But if you've got a participating financial institution, say in the Cayman Islands or in Central America, then all you have to do is go to a group that corresponds with that financial institution, present your card and take out your cash. So there's nothing at the border that you have to display. Under U.S. law, these cards, however much they may be worth are not considered financial instruments. Therefore, the border patrol, customs agents when they see them there is no violation because they're not part of the money that you're required to declare. And they can't read them, which is a big problem. Basically we need to have transparency so that if a law enforcement agency looks at one of these cards, he or she knows how much it is worth.

Chetry: So you want Congress to take up this issue. You made some recommendations about this situation. What do you hope to achieve and are they listening to your concerns about this?

Goddard: Well, they finally are. This is not a new concern. FinCEN, the Treasury Department report over three years ago, said here's a loophole that is causing large amounts of money to go across the border undetected. And my goal and our goal in law enforcement is to cut off the flow of cash to the organized criminal cartels that are bringing drugs and people in to the United States. This is one way we can do it.

Chetry: It seems the other big problem is these banks and these largely unregulated countries like the Cayman Islands don't have mechanisms in place that follow suspicious transactions, large amounts of money. Is there any way that the U.S. government or the states’ attorneys general can do anything about that?

Goddard: As a state attorney general, I cannot. However, the U.S. government being involved in international financial money laundering observation and interdiction can play a major role. But this is an international problem. You put your finger on it. There are huge amounts of money being electronically transferred across borders throughout the world. Not just to Mexico. And so we need to play a much more observant role if we're going to cut off this flow of illegal cash. That's a big, big problem. But let’s start with these gift cards. They're a huge loophole in our currency transaction regulation.

Chetry: How big of a dent do you think you'll be able to put in drug trafficking by being able to get this gift card loophole closed?

Goddard: Nobody knows, because nobody knows how much cash is going because it's not reported. So how much is going across the border into Mexico? I cannot tell you. But it is one source of money that is completely below the radar screen. It's not being observed. It's not … being sniffed by cash-sniffing dogs. It is an entirely different way to smuggle money. Let's bear in mind that organized crime depends on money. They're not in it for the love of the game. They're in it for the cash. If we can cut off or restrict the cash we'll go a long way to cutting down the cartel violence in Mexico.

Chetry: You made these recommendations to Congress. We'll see what action, if any, they're prepared to take.

Goddard: I hope they take action soon.


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OreciaHughes   June 10th, 2009 10:22 am ET

It time to start thinking outside the box when it comes to how, these drug cartels distribute and receive thier money and the drugs. Give me a break gift cards, then put limits on them and monitor if they are being abused. I am trying to come up with legal and innovative ways to make money, and these drug lords and using gift cards to get over the system. I am sick about hearing about how they are getting over the system and want to hear more about them being procecuted to the fullest.

Bryan   June 10th, 2009 12:19 pm ET

Sure, let's spend another billion dollars cracking down on these gift cards. By the time that's done, the next trick will come along and require another billion dollars to counteract.

Or, we legalize, regulate and tax drugs.

Take the billions we spend trying to enforce a failed prohibition (and locking up all of the non-violent drug offenders) and direct a small portion of that towards the treatment of addiction.

If you've got kids, they can most likely get marijauna easier than beer, that's how successful prohibition has been... hardly worth the billions we spend.

DKS   June 10th, 2009 12:20 pm ET

Hmmm how about we take a page out of Portugal and legalize drugs? Look up thier statisics on what happen when they legalize drugs, purely amazing.

It shouldn't be the governments job to say what drugs u can or can not have.

RevRayGreen   June 10th, 2009 12:21 pm ET

legalize marijuana

Jack Phoeninx,az   June 10th, 2009 12:21 pm ET

If they are issued in the US, the Feds should lock the accounts for 30 days from issue and monitor all monies taken out, or take the money out for them......

Todd   June 10th, 2009 12:21 pm ET

How about making a certain plant legal again....tax it, import it, export it, i am sure there is money to be made and tempers to be calmed by doing this...don't worry though, our US government will find a way to spend the money made off of that irresponsibly.

Big John   June 10th, 2009 12:22 pm ET

I do not need big brother looking into how much money I have on a gift card. Break the Cartel's backs by legalizing Marijuana. No profit for cartel's, crime goes down, Tax it .. Profit USA

MarkB.   June 10th, 2009 12:22 pm ET

The article leaves out where the "cash" part of this is coming from...are the druglords depositing $$$$$ in some shady bank in the states or what? Somebody explain why this should be a concern...

Tevil   June 10th, 2009 12:22 pm ET

its too difficult to monitor a gift card....

i mean they would have to have credit machines at border posts and people checking the mail for them.

the only way to monitor it would be to have the banks alerting the government when a gift card with that much is used somewhere in the states reaching an off shore bank/account.

even the cartels need to have the money transferred to a US bank to use it, right? but then next will just be credit cards these guys will use to launder money some how.

seriously were in iraq and this stuff is happening right here in our border. we have our children being kid napped and wemon being abducted and sold (not just ours but even other coutries who get smuggled in under our noses, which is JST as bad) via the mexican border. we need to have some of our advanced troops go in and seriously maintain and train the mexican gaurd because most of them are worse than the cartels.

its depressing how this infects our country when there REALLY ARE many good hard working mexicans who would love the chance to come here and do great things. No IM NOT MEXICAN!

s   June 10th, 2009 12:24 pm ET

Legalize drugs and you won't have this problem...

C   June 10th, 2009 12:25 pm ET

We have reached a crossroads in the completely failed war on drugs. We are honestly down to two options. We can declare a real war on the cartels and send more troops into dangerous areas to fight more people that are unorganized and unbeatable because the corruption runs so deep that it's penetrated our own government. Or we can completely legalize drugs taxing them to make money for our government and simultaneously pushing the cartels out of business. Neither of these options are attractive but I have yet to hear a better one from anyone.
If we leave it the way it is the drug cartels will be the government in a lot of these country's shortly.

NotoriousTyler   June 10th, 2009 12:26 pm ET

I agree it is time to do something about these cards. I mean we have the technology to track these cards. Why not verify the amount of cash the cards are holding and keep tabs on where the cash is going.. track the cash and bam you'll nab the smugglers in the process. Other than that, I'd say that setting a limit on the cards is another option but seems pointless because then they'll just set up their money in multiple accounts and get several cards instead of just one, therefore making it harder to track and monitor the cash flow coming into and going out of the states.

realist   June 10th, 2009 12:31 pm ET

Solution: Legalize all drugs.

Kevin   June 10th, 2009 12:31 pm ET

Just legalize it problem solved

Brian   June 10th, 2009 12:32 pm ET

How about cracking down on drug addiction here in the U.S??!! We Americans are feeding into these Cartels. Without American Addicts..Cartels dont make money and in turn have no use for gift cards. Problem solved?

PhilLawrence   June 10th, 2009 12:34 pm ET

Just another promotion for more tax dollars by a government agency. Scaring us citizens by citing "drug lords" and "cartels".

If marijauana was legalized, then 60% (the feds numbers) of the problem goes away. But that would be too easy.

Even if we spent the time and money to "defeat" cash cards, because of drug prohibition there will be incentive to get around it. We've been chasing our tail for 40 years.

PJ   June 10th, 2009 12:34 pm ET

It's great seeing idiots in action- that's the attraction of the Three Stooges. Conservatives LOVE to blather on about Free Market principles and capitalism and economics (what little they know of it), UNLESS you start talking about the drug trade. Oh, oh, oh!!! Well, they backpedal, those principles don't apply. The HELL they don't! Does anyone gun down civilians for soap or microwave ovens or ice cream treats? The antediluvian drug laws of the US create artificial scarcity- there is an enormous permanent captive market, enforced scarcity, and a HUGE profit margin. The US- the biggest unregulated gun market in the World is also arming the gangs to the teeth. The problem ISN'T Mexico or corruption (you mean like AIG, Goldman Sachs, BOA and Citibank? THEY'RE even MORE corrupt than the Mexican Police and no one is doing anything...) or even drug trafficking- it's DRUG USE and DRUG LAWS and GUN LAWS and the fat dumb white people in the Ignorant US of ESCAPE...

R.Lord   June 10th, 2009 12:35 pm ET

The 'war on drugs' is a joke, like stomping ants and thinking the insects will go extinct because of your effort. Legalize and tax, and the profits the cartels have been enjoying will be available for good works in this country. Or just keep stomping at the ants.

Duke   June 10th, 2009 12:35 pm ET

It seems that if these funds are being put on electronic cards then it is a perfectly opportunity to track the money. Why not work on that more than trying to stop it. Not only do you know where the money originates, you know where it went as well as how much. At least use the tools we already have to discourage this procedure to transport money.

ric chan   June 10th, 2009 12:35 pm ET

The ONLY problem is the drug habits of Americans ! You guys stop using drugs. If an American is caught with illegal drugs they should also be charged with an accessory to murder – all the murders taking place in Mexico. And all their property should be seized and sold with the funds going to the Mexican gov't to fight drug crime. That should be a detterent. That will also end any drug war in Mexico or elsewhere on the American continent...

musicjunkie   June 10th, 2009 12:36 pm ET

The government could just legalize drugs. And I'm not some junkie looking to get around a fine or jail time. Obviously outlawing drugs is not slowing the use of them at all. Legal or not, people will continue to use them. Take a look at other countries where drugs are legal and compare their crime rates to the states' crime rates, there's a significant gap. If drugs are legal they could be regulated just like alcohol and tobacco. Despite difficult economic times, people don't go without their cigarettes or alcohol, even with higher taxes.

Jason   June 10th, 2009 12:36 pm ET

Sorry, but if this is Arizona's biggest problem, they are in good shape. Use your giftcard, you dirtbag, just put money in the u.s economy. How many times have we discussed the "war on drugs". It's a lost cause.

Twila Escalante   June 10th, 2009 12:36 pm ET

Your reference to the Cayman Islands as a "largely unregulated" country is incorrect and misleading. The Cayman Islands is heavily regulated and has been operating under strict regulations since the 1980's. It is easier to open a bank account in the United States than it is in the Cayman Islands. Our primary laws among many include, The Proceeds of Crime Law (revised in 2007),, The Tax Information Authority Law, The Reporting of Savings Income Information Law. In addition, we have various supervisory bodies including the Cayman Islands Monetary Authority, The Financial Reporting Authority and the Tax Reporting Authority which are statutory bound to regulate illegal flows and means of funds.

washingtonian   June 10th, 2009 12:36 pm ET

These drug lords are so creative and smart with their submersibles, gift cards, etc. They really need to come to DC and be put on payroll. I am sure they could figure out ways to fix the economy and win the war on terror.

Andy   June 10th, 2009 12:39 pm ET

It's only the illegality of drugs that makes them profitable. And more attractive to the thrill seeking user. No profits, no cartels, no back street suppliers.

I don't care if bored idiots want to stupefy or kill themselves. Only the forced application of drugs to another or a minor should be illegal. But then hugely punished.

Keitheith   June 10th, 2009 12:40 pm ET

Ok. Let’s keep playing catch-up. Let’s do it forever. When drug runners find yet another loop hole, which they will, we’ll have to sit around to find another solution. Geeze! THE ANTI-DRUG LAWS MAKE DRUG DEALING SO PROFITABLE!! PROHIBITION MAKES DRUGS WORTH MONEY. These guys are killing each other over drugs, they are killing each other over the money that the drugs enable to make.

Sense   June 10th, 2009 12:40 pm ET

You want to know how to cut off the cartels cash? Decriminalize (not legalize) marijuana and regulate and offer rehabilitation to users of harder stuff like coke or club drugs . People are gonna get high if they want to and no amount of enforcement or punishment will change that. Spend more money on the trafficking of Meth and opiates. You know the drugs that really ruin lives. Of course that will never happen because crime and law enforcement are two HUGE industries that go hand in hand. The war on drugs isnt meant to be won. The same as the war on crime or the war on terror or even the war on poverty. If you completely stop the flow of drugs then you put Judges who try the cases, Probation officers who supervise the offenders, Correction officers who guard the prisoners and rehab/drug testing facilities who deal with the addicts out of business. The truth is that drug dealers put a lot of money in the economy and if you were to take all that out it would have a very harmful effect.

Set it Free   June 10th, 2009 12:41 pm ET

Just legalize. Done.

Frank Grimes   June 10th, 2009 12:41 pm ET

Brilliant. Sometimes I wish I was in a drug cartel making all this money. But for now, I'm just a SQL slave.

Rick McDaniel   June 10th, 2009 12:41 pm ET

It is my view, that governments that want to stop the drug trade, can do so, one way or another. It is apparent that any drug operation large enough to be a major player in the international drug trade, has been identified by their governments, if for no other reason, but to collect income taxes.

In most cases, the drug trafficking is ignored, as the governments really don't want to stop it. I think that is especially true of Mexico, and Columbia.

It has occurred to me, that such a position of ignoring the drug trade, and making no effort to stop it, should be a sufficient reason for the US to step in, with military force, to eliminate it.

Jon   June 10th, 2009 12:42 pm ET

The only people to blame for the cartels are ourselves. Drug smuggling is a profitable business, why? Because of demand. It's a demand driven market. If we take out one smuggler out another will jump to take his/her place because the rewards are far greater than the risk. The only real way to get rid of these people is to get rid of the demand. If noone wants to buy the drugs, then the smugglers will stop bringing them in.

Many people use drugs recreationally. If we make the penalties harsh enough for simple possession, those people will stop using and the cash flow will dry up. It's not a difficult concept...

Larry Adamski   June 10th, 2009 12:42 pm ET

Just another attempt at destroying our civil liberties in the name of the all important (yet totally failed) War on Drugs.

Angie   June 10th, 2009 12:44 pm ET

I agree about thinking outside the box. You can put limits on the cards but than how does one police how many cards they can have. The problem has to start in the global bank markets. Than one has to decide how much money is too much money to deposit at one time before you can even patrol this. The government needs to get people who have the street smart skills to think like the drug cartel people.

If the codes within the cards are numbers and this is truly cash – find out where these cards are being created or are these cards fictitious and there really wasn't any cash to begin with – maybe these cards are like counterfeit but in the twenty-first century style with cash cards. How does anyone really know if this is real cash.
Something to think about.

Ben   June 10th, 2009 12:45 pm ET

The problem doesn't really stem from these "new" ways that drug cartels are laundering or keeping their money. Goddard even mentioned that this has been a concern for over three years.

The problem stems from the sea of red tape that people have to swim through to get anything done. Let's say congress actually did start working on it three years ago, I wouldn't be surprised if it was still ongoing, and by the time they get it resolved, the drug cartels would have another new way to get things done.

Mike   June 10th, 2009 12:45 pm ET

Why does it even have to be gift cards? The money is out of US control as soon asit is deposited in an off-shore account. The card itself doesn't even have to move – just have two debit cards linked to the same account. Are our regulators that naive?
The loophole is in regulating the banks themselves. Any large deposits into any institution in the world need to be tracked.

jamie   June 10th, 2009 12:45 pm ET

Legalize drugs and stop the assault on civil liberties!

M.R.   June 10th, 2009 12:45 pm ET

I have the same question as MarkB. has...

These cards have to be loaded with money somewhere in the United States, right? The article doesn't talk about that at all. How is the money being put on these cards?

Erik   June 10th, 2009 12:46 pm ET

I would love to have the government be able to check how much money is in my bank accounts whenever I cross the border... NOT.

Legalize.

Jim   June 10th, 2009 12:47 pm ET

Legalize it, regulate it and tax it. Problems solved...

Joe Taxpayer   June 10th, 2009 12:48 pm ET

Excellent. I did not think about how great this would be to hide money from the ex-wife's lawyers. Money orders also work well for small amounts under 5K too, but they have a face value stamped on them.

This is probably why most 'gift' cards have limits of $300 dollars or so. International bank gift cards...very interesting.

Tonky   June 10th, 2009 12:48 pm ET

Why are these cards even necessary? All you need is a computer and an internet connection to access funds electronically. It does not matter the conveyance device.

Isn't actual hard currency still being used to buy drugs on the street level?
These electronic cards are a red herring.

What we need is a way to regulate giant deposits made in the Caymens by these violent parasites.

skb   June 10th, 2009 12:48 pm ET

Confiscate ALL gift cards at the border . . . no deposit, no return!! Second choice: Xray all people crossing the border with enough "bernoulis" to delete any information on any card.

Mike   June 10th, 2009 12:49 pm ET

And, it doesn't even have to be large deposits. With electronics, they could use computers to send thousands of small transactions.

C   June 10th, 2009 12:51 pm ET

Yeah because making harsh penalties has stopped everyone from using drugs in every country. The point really is you get the death penalty for drugs in Singapore but people still do it. Making the drug penalties higher makes the cartels and users far more dangerous and equals far more death. We can't train the Mexican guard because more than half of them work for the cartels. We can't beat the cartels in a war because they have more money and soldiers than you can even imagine. If you fight a war on drugs you are fighting a war on your own family and friends. No one should have the right to tell anyone what they can and can't put in there bodies. It's been proven with Portugal and the Netherlands that legalization brings a short increase of use followed by a meteoric fall in drug use and violence. Prohibition has never worked for any drug or drink anywhere. someone will always find a way to profit and then become violent. People are never going to stop using and wanting. The demand isn't going anywhere. Locking up non violent drug users is a waste of time and my tax dollars.

TommyBoy   June 10th, 2009 12:51 pm ET

So the law will have to be written very carefully. Or the U.S. would be search all tourist carried bank and gift cards... Would they hold a card of some Middle Eastern prince or European with millions on his bank card as smuggler?

Richard Martin   June 10th, 2009 12:51 pm ET

Congress won't touch the issue. The RNC has been using those exact gift cards as ways of avoiding government oversight for years by paying or rewarding "volunteers" to political campaigns. They have to report cash donations to campaigns but they don't have to report gift cards given to campaign staffers during campaign events. It's soft cash for everyone, not just drug lords. It's also fairly untraceable. Can't accept a cash donation? Lower your out of pocket expenses by having your campaign staffers not cost anything!

Major   June 10th, 2009 12:51 pm ET

I completely agree with the comments advocating the decriminalization of marijuana. However we should also realize that international money laundering is a component to many different criminal enterprises, not simply limited to marijuana or even the drug trade for that matter.

Benjamin   June 10th, 2009 12:52 pm ET

Legalize it!

David Mostel   June 10th, 2009 12:52 pm ET

The drug cartels pay off the politicians and government officials not to legalize drugs. If the cartel pays out 10% of what they bring in it's a lot of money for these politicians and officials and a small amount for the cartels. Corruption is everywhere, the U.S.A., Mexico, S. America Etc. Legalization is probably the answer as proven by the repeal of prohibition but before this can be done we have to solve the corruption problem.

Chad N.   June 10th, 2009 12:52 pm ET

Once again, in order to get to the few criminals engaging in this process the average every day guy has to suffer. If they start checking these "gift cards" in order to catch the drug cartels, the cartels just move on to the next method of moving money that is not detectable. Meanwhile, the average person is now having to declare the value of gift cards, have them scanned or whatever they decide to do adding to waits, more loss of personal liberty and further invasion of privacy.

End result, people suffer and the cartels simply move on.

This is just stupid.

phat   June 10th, 2009 12:53 pm ET

so when is obama going to DO HIS JOB and close down the border from ALL ILLEGAL ACTIVITY?

Pete   June 10th, 2009 12:54 pm ET

Let's create a brand new method for concealing large amounts of cash.....what could possibly go wrong? I mean – how could be brilliant financial wizard possibly foresee that criminals might use them to, oh, I don;t know, smuggle and transfer large amounts of money?

The time to legalize, oversee, tax, and tax certain drugs is 30 years overdue. Make the hits legal, bring the price down to what people pay for a regular cigarette or shot of liquor – and I have a feeling there will be no further market for criminals in the product(s).

Logic 101. Something any child of 12 could figure out. And yet it continues to elude the grasp of our politicians.

jeb b   June 10th, 2009 12:54 pm ET

this is why you see mexican restrauants popping up all over the united states. sometimes 4 and 5 on a corner. the start up bussiness is a way to clean that drug money from ma and pop stores who send money orders back south of the border to automotive mechanic and body shops. to you name it. all these nova costra mob entities are just lining up in the united states. where is ellioit ness when we need him. cause who's in there now, seems to me like their always slow out the shue

bryan   June 10th, 2009 12:54 pm ET

i cant believe drug cartels are ahead of Govt before govt find it out. Govt need few more step ahead before drugs cartels do!.

Justin   June 10th, 2009 12:54 pm ET

The ongoing debate. What is the real issue at hand?

We know how to easily solve this issue. And we don't.

There is going to be no end to the drug war. It's impossible.

After Billions of years, these items still exist. Marijuana has only been illegal for 40 years.

We have had nothing but problems with the system used to help counteract the marijuana situation.

Why is it so hard to have reform? I could go back to saying it was illegal to ban it in the first place, but since the start of the constitution, we have done everything we can to modify it, although the document itself says it cannot be modified.

We lost since day 1. Government has full power. Prove me wrong.

Juan   June 10th, 2009 12:54 pm ET

These guys are amazing... (I'm not talking about the druglords)... I think the key to stop the drugwar is to:
1) Stop buying drugs
2) Stop selling weapons to drugdealers

I guess by doing this the drug problem will be over...however their jobs and black market economy would be over too.

No wonder why they keep "fighting.."

Justin   June 10th, 2009 12:56 pm ET

skb

Your idea is flawed as well. If we confiscate gift cards at the border, how are you supposed to access your cash in different nations?

FrancV   June 10th, 2009 12:56 pm ET

This business will always be ahead of the game – they have no rules or anything to lose.
Make pot legal and you'll hit them in the pocket, tax it and we can have a real fight on our hands.

The only ones winning here are the politicians and the makers of of police equipment

adam12   June 10th, 2009 12:57 pm ET

Anyone ever try to buy a prepaid gift card bearing a visa or mastercard logo? You have to show a valid state ID now to get one. Even when you buy them online, you must fax a valid state ID copy before they will send it. President Bush made it this way after 9/11 to cut terrorist funding this way. Arizona is either way behind the 8 ball or just real slow. They should of made these changes way back when the rest of the country did.

Andy   June 10th, 2009 12:57 pm ET

This is getting ridiculous. Stop wasting resources to prohibit plastic coming over the border and just legalize drugs altogether. I'm sick of wasting my tax dollars on your pathetic War on Flowers

Jon   June 10th, 2009 12:57 pm ET

musicjunkie – oh yea! Actually if you look at it during a recession the BEST companies to put your money into are tobacco and alcohol! I believe they've posted pretty good profits during this ENTIRE economic downturn

Jessica   June 10th, 2009 12:58 pm ET

i'm utterly confused why we can't even – at a bare minimum – have an honest discussion about legalizing marijuana. the pro's, the con's...and how we could save money, heck MAKE money...while trying to address addiction (which is a problem, but people can be addicted to so many things, alcohol, gambling, sex, ect...why single out marijuana as infinitely worse than the others?)

there's very little logical reasoning why it's illegal...and we have more and more mounting reasons as to why to legalize it!

pgh   June 10th, 2009 12:59 pm ET

The following question must be asked. Which is more harmful, drug use by citizens or giving the Government the power to track every single one of your financial transactions?

It's sad to say, but the decision to abuse drugs is personal. Most of us make the right choice. If we allow the government such unlimited access to every aspect of our daily commerce, it will affect each and every one of us an anyone who thinks that such power won't be abused is dangerously wrong.

The most despicable aspect of the drug war has been its effect on justice. Property seizures provide an incentive for corruption. Prison overcrowding as a result of mandatory sentencing robs us of both our tax dollars and the contributions that many of those incarcerated might make to society. We have, in essence, provided unlimited financing to the scum of the earth in the form of drug profits. Yet none of this has, in any way, reduced thedrug problem. I'm reminded of the defintion of insanity as being doing the same thing again and again and each time expecting a different outcome.

It's time to end the madness and treat drug abuse as a social problem, not a ciminal one.

CM   June 10th, 2009 12:59 pm ET

This is just the latest scheme of the cartels and my question for our government is when are you going to stop throwing our money at this problem without actually having a plan?! maybe im just naive but it seems pretty simple to me: legalize the most popular drug in the U.S., marijuana, and cut the cartels off to their number one money maker. Then the U.S. can regulate the growth and distribution of marijuana and maybe oh i dont know help this country get out of this recession!! people all ages are smoking up everyday for both medical and recreational reasons so instead of punishing them why not make money from them? Our government just needs to wake up and realize that no matter how many "preventative" measures they take, they are fighting a much more powerful and wealthy opponenet who will always come back stronger unless the U.S. takes an offensive approach and hits them where it hurts the most: their wallets.

Cindy   June 10th, 2009 1:00 pm ET

It's good to see so many commentors "seeing the light" on the failed War on Drugs and the need for legalization.

Justin   June 10th, 2009 1:00 pm ET

Gift cards themselves don't have names attached to them. Although Credit and Debit cards do. Just as Cash, Giftcards work the same way. I can see why they would use it, but there was a way to ban it, they would use a trade good. Or, they would deal as we deal with China.

We send goods to China, China trades with North Korea, North Korea trades with Mexico. You can't win.

Common Sense   June 10th, 2009 1:00 pm ET

Ok the gift cards are filled with unknown amount of cash and than taken to shady banks in Cayman Islands and Central America and cashed...got that point. However, how did the gift cards get filled. It has to happen here. So there are shady banks here too. So before pointing fingers at Cayman Islands and Central America lets look at ourselves. If a developed country like ours can stop banks from depositing unknown amounts of money in gift cards than I think it is a little bit too much to ask other countries to control on cashing the gift cards.
So Mr. Attorney General are you looking in how to catch the banks here too or do thay have lobbiest who pour campaign money? This is all linked. Politicians, banks, drug lords...all of them are linked to make money. A catch here and there is to fool us the general public who in the end pay for all this.

Tyler   June 10th, 2009 1:00 pm ET

Time to finally legalize drugs, tax them, and not only see the rewards from that taxation but also stop funneling money down the black whole which is the US War on Drugs.

adam12   June 10th, 2009 1:01 pm ET

Just to add, why can't gift card companies add a metal strip or plate that sets off an alarm like when shop lifters get caught at the store? This sounds like such a simple problem to divert. What's next, no gold sales in the U.S. because drug dealers are accepting gold?????

James   June 10th, 2009 1:01 pm ET

Well, it would seem that the Drug Lords or whomever thought this one up is smarter than it would appear.

Aaron   June 10th, 2009 1:03 pm ET

Here is how this works:

Drug Zar walks into reputable Swiss bank and purchases a $200,000 "gift card" with cash under an assumed name. Swiss bank doesn't file suspicious activity report with the FBI so no record is generated in the US. Misc Drug lacky enters the US via plane, train, or automobile with the "gift card" stuck in behind his mastercard. Misc Drug lacky walks to the reputable national bank branch that has a relationship with reputable Swiss Bank and sticks the card into an ATM or goes through the teller line and withdraws however much he needs. The name doesn't appear on the OFAC list so no report is generated and the transaction isn't stoped. No large cash deposits are being made so no record goes to the FBI. Outside crimal and/or terrorist group has succeeded in smuggling cash into the united states.

Tevil   June 10th, 2009 1:03 pm ET

legalizing all drugs will just make problems worse. legalizing pot will do nothing (even though pot should be) because people dont usually get shot over pot.

you CANT legalize heroine/crack/coke/X/ETC because they are overly damaging drugs that inadvertantly involve others.

children, people who get mugged for drug money. these drugs people get shot for are killers themselves.

problem here is mexico itself. they need to be regulated by a big brother....... US.

mark my word, next 5 years PR is the next state and Mexico is the next common. WE NEED to get in there and start coming down hard or LITTERALLY tell them we are putting up a shooting wall (berlin wall). start telling the locals they will have NO CHANCE of EVER coming to the states and i bet they will all change their tunes fast. its sad because i have been to bad parts of mexico and none of those people deserve the lifestyle they are trapped in.

removed all traffic to and from mexico, basically give them the choice.

1) let us in and let us start cleaning you up in return for a,b,c and in return we get a safer enviroment, some hard working people and new land that companies can not escape to for tax breaks.

2) make them national pariahs and force them into a cuba like state, which we all know they WONT go for.

Eric   June 10th, 2009 1:04 pm ET

WOW!!! Billions of dollars in tax money and you just figure this out??? COMMON SENSE!!!!

dan in Tucson AZ   June 10th, 2009 1:06 pm ET

The fed and the US government would like nothing better than controlling the flow of international money. That is where I see this going. Seems like a good excuse for our government to get more control. Well it won't happen, and the private banks can see right through this charade.

crazytrpr   June 10th, 2009 1:07 pm ET

Ok 1 ) legalize weed so it stops being sucha gateway drug for the hard stuff.

2) What the hell are people thinking banning stored value or gift cards? With as power mad and money grubbing governments we have at all levels, cash falling out of use and people want "ban" these things under the guise of on the war on drugs.

Has anyone really thought out the ramifications of a cashless society be? Stalin would have had an orgasm at the thought of a cashless society. And not because he was dedicated communist either. The power governments and well connected would have plus the paranoia knowing that every transaction is monitored & traceable would be pretty scary. As society become less free it will become a nasty little pressure cooker with a host of un-intended consequences. Not the least of which would be a black/gray market for anonymous money

Helen   June 10th, 2009 1:07 pm ET

They can't legalize the drugs because they haven't found a way to legally to check to see if you are under the influence that is foolproof at this point. So when you get stopped they don't have a any roadside games to play to check to see if under the influence, and to what level. When science catches up to that point you will see legailization of certain drugs, but until then, it's not going to happen.

David Rogers   June 10th, 2009 1:08 pm ET

The answer to this problem is real simple. The solution to all drug lord related issues can be solved by the American government right now if they really cared about smugglers laundering money based on illicit sales of drugs. Legalize. If you legalize then these "Drug Lords" won't be lords of anythings. That's how you win the war on drugs, you take away their black market by legalizing.

John   June 10th, 2009 1:08 pm ET

The answer is not another intrusion into privacy, it is getting the money out of the business. When was the last time that the Seagrams boys had a shoot out with the Jack Daniels mob? It stands to reason that if we can't stop the drugs coming in, we won't be able to stop the money going out.

Find legal distribution methods, and treat drug abuse as a public health issue and not a legal issue. The war on drugs is 40 years old. It has cost too much and has provided far too few returns on investment. One of the biggest costs has been in terms of our personal liberty and privacy.

Repeating the same action that provides a negative reaction and expecting a different outcome each time you do it is the definition of insanity.

David Rogers   June 10th, 2009 1:09 pm ET

Also, I think it is clear and evident that the American people want legalization.

T   June 10th, 2009 1:10 pm ET

I agree with Bryan. Legalize/decriminalize drugs and tax it. This is another way for a failed system to gain access to our privacy. From what I read on CNN they are trying to create a bill that will have more "transparency" for law enforcement officers see the value on these gift cards. So what happens if they decide to see the value in your bank account by just grabbing one of your atm cards..

Is there no privacy in the US anymore?

Bard   June 10th, 2009 1:10 pm ET

No wonder the country is in such a credit mess! The government encourages people to use credit cards and other easily trackable financial conveyances through its failure to print practical-denomination bills (how many $100 bills do you need to buy a car? or a house at a courthouse auction where cash is required? - why don't we have $1,000 and higher denomination bills?) and the promulgation of the stereotype that if you carry around a lot of cash you must be a drug dealer, so your money can be confiscated on the assumption that you must have obtained it illegally.

What obnoxious snoops!

jdmeara   June 10th, 2009 1:11 pm ET

Give up the war on drugs. We are in the midst of a huge financial crisis. Direct the money to places progress can be made. Tax the dope and knock the black market of marijuana out. Let it be left to the entrepreneurs of our country. Not only do they smuggle into the country they are using our national parks. All over whether or not some people can get high, which is practically a pre-requisite for being president in this country now. Obama – Check. Bush – Check. Clinton – Check. That's 20 years of our chief executive that have experience with a substance we wage a multi-billion war against.

Felix   June 10th, 2009 1:11 pm ET

Sure legalize drugs.

There will still be "illegal" drugs because the "legal" drugs will cost way to much due to taxes. Legalization alone will not fix the problem. To think so is kind of naive.

A Man In Houston   June 10th, 2009 1:11 pm ET

After watching a program on National Geographic and finding out the US spends 35 billion on fighting marijuana. I was angry. I also learned that these cartels make 68% of their money on this drug alone. We are fighting something that should be legal!! This money and possible new industry would help save dollars, earn dollars, create jobs and cripple the cartels’ cash flow. Now we are going to spend billions on fighting gift cards....how stupid!

I see religion get in the way of this matter and the government that’s irresponsible and more concerned about votes. Being here in Texas, I see the narrow mindset of this topic but, it's an "issue" that’s growing and I know law enforcement can’t stop it. People wake up! It's time for legalization NOW! How many more people have to die? How much money has to be wasted that can go to education, research, the homeless, etc...

America....get your head out of the 50's and realize what needs to be done. We are allowing a law from the early 1900's to affect us and false understanding of a drug. It’s time to change the law of a century ago.

RevRayGreen   June 10th, 2009 1:12 pm ET

legalize a plant that isn't a drug, drug dealers sell it because it's illegal but it can be a cure for many illness, wanting to feel good one of them.

cannabis is an ancient healing herb and relegalization is the solution.

Kyle   June 10th, 2009 1:13 pm ET

Uhhh..... this is no surprise Wal-Mart has a similar card/ accounts that one can transfer money across any state to someone else.... same thing smaller scale

Brtandon B   June 10th, 2009 1:13 pm ET

I agree... The drug war is a money pit 1.3 Trillion dollars between 1992 and 2002. Drugs are cheaper and more available. Just give up for the sake of the country. Tax and regulate drugs and spend the proceeds on treatment and rehab of addicts. It is just a waste of 50 billion dollars a year.

stephen   June 10th, 2009 1:15 pm ET

With the kind of money the cartel is making, they will always find a way to do what they want to do. It can't be won. Exactly as Brian said, "Sure, let’s spend another billion dollars cracking down on these gift cards. By the time that’s done, the next trick will come along and require another billion dollars to counteract."

This war on drugs is so ridiculous, it makes me think the proponents of it are just as doped up as the people they're trying to persecute. Marijuana is bad- take xanax, or oxycotin, or klonzepam instead. Support American drug dealers, not mexican.

ANTONIO VIRGINIA BEACH   June 10th, 2009 1:15 pm ET

Admit it, we americans are a bunch of drug addicts. Don't blame the Mexicans, Colombian, and whom ever else we want to blame. We are a nation of addicts.

dan   June 10th, 2009 1:16 pm ET

I have read many of these posts by users. The only one that makes any sense at all is legalize the drugs. Forget trying to combat the drug cartels, forget trying to charge drug users with murder. that won't work, and it's ridiculous. Legalize drugs. If you want leave heroin illegal or something that is fine. Heroin is very dangerous, and not NEARLY as lucrative as pot and other more mainstream drugs. Things like POT for god sakes need to be legal. ITS EVERYWHERE ANYWAY.... and I do mean E-V-E-R-Y-W-H-E-R-E... Those of you who do not smoke pot or are out of the loop would be SHOCKED to see how much pot is out on the streets. AND ITS NOT EVEN FROM MEXICO. It comes from EVERYWHERE. Oh by the way YOU CAN GROW YOUR OWN POT RATHER EASILY... SO maybe just maybe its time to stop wasting money looking for everyone in the world with a grow light set up in their basement... By the way alcohol is legal and the country didn't fall apart. Alcohol is far worse for the body and mind that marijuana..... Look at how alcohol has ruined people and families. Try to find a person who has been ruined by pot... Yeah exactly, you can't... Anyone who is opposed to legalizing pot simply has no idea what it does. They must have never tried it. Pot really is not very strong. Even "today's pot" is not very strong. If you are worried about drug trade stop heroin!!!!!! You may actually save some lives in the process...

Rick O.   June 10th, 2009 1:17 pm ET

US government is a bunch of idiots and the cartels take us for that!
Legalize Dummies! Legalize just pot to start and see the effect...answer: more tax dollars, less police and jail house costs. The only downside: Probably put a lot of lawyers out of business. Oh darn!
And we let these ding-dongs make decisions for the country and its people...America, Wake up!
http://www.petitiononline.com/limits09

Dave Mishem   June 10th, 2009 1:18 pm ET

Why are law enforcement people such morons?

Letting them "read" a card will be like giving a monkey a microscope. Ever heard of steganography? Plausible deniability? You can hide data in a reusable Macy's card if you know how.

The problem is in data inspection by the authorities. We've known since the 90s that you can't do it. And there are a LOT of mathematicians who value privacy more than the drug war, and will continue to make this the status quo.

Pep   June 10th, 2009 1:18 pm ET

Death sentence for all drug trafficers, life in prison for all drug users. end of problem.

Damian   June 10th, 2009 1:19 pm ET

mexico doesnt only smuggle weed. heroin, Amphetamines, Cocaine, Ecstasys, you name it, they smuggle it.

Chris   June 10th, 2009 1:19 pm ET

Clearly this was written for those uninformed about how these stored value cards work. Issuing banks screen these deposits as part of their AML practices.

But more important still is the legalization issue. Legalize it and tax it, problem solved.

Shake   June 10th, 2009 1:19 pm ET

If the cartels are moving money with gift cards then the politicians are doing it too. The ponzi schemers are taking money out of the country as well. The loophole was not put in place for drug cartels. This little story has such major implications and we thought swiss banks and off shore accounts were big.

Homer   June 10th, 2009 1:20 pm ET

LEGALIZE IT, TAX IT AND REAP THE BENEFITS
LEAVE OUR RIGHTS ALONE

arw   June 10th, 2009 1:21 pm ET

The drug war is a farce. It is evident there is no way to win a war on drugs, yet we continue to pour money into it. Drug laws were originally passed under false pretenses, and today it has turned out to be one of the biggest money rackets in existence. The government makes money from it on both sides. Do you really think that 5 tons of cocaine are destroyed once it is confiscated?

Government has no right to protect you from yourself, only from others. When will the public demand that government respect our rights? We are a republic, not a democracy—a fine but crucial distinction. The public would be far better served if drugs were made legal but controlled. There would be hardly any accidental overdoses or toxic side effects from poor quality control. Crime would be reduced substantially (if they were sold for fair value which most cost but a pittance to make). Built into the price could be taxes that would pay for those who did become addicted but wanted to turn their lives around.

Quite frankly, I see no downside to legalizing drugs. It will not lead to greater drug addiction. You could put a ton of heroin in my reach forever and I would never touch it. Those who want to do drugs do them already—both legally and illegally. Most stop substantial drug usage as they take on greater responsibilities in life. And for those who do become addicted... I mean, really, why kick a person when they’re down? Nobody incarcerates people for the many other kinds of addiction people fall prey too.

So wake up people. Show a little tenderness. Abolish laws that restrict your rights to live your life as you see fit, laws that cannot possibly do good or make the world a better place. Give up your alcohol and grow a little pot—legally, of course. Nobody ever died from smoking that. Recreational drug use just might free your mind.

Brandon   June 10th, 2009 1:22 pm ET

Cartels will ALWAYS find a way to outsmart the system, just as bootleggers did during Prohibition. The answer is simple: legalize drugs. Perhaps not all of them, but at a bare minimum the least harmful ones (marijuana is a no-brainer here). It's the only way to completely and utterly defeat the foreign drug cartels (and a great way to profit at it simultaneously).

Montana   June 10th, 2009 1:23 pm ET

Legalizing the drugs would just create a problem that was a thousand times worse... a nation full of heroin and coke and meth addicts. It would become as widespread as tobacco and alcohol and prescription pain pill use is now.

We have a paradox here. We are in an unwinnable war, which MUST be fought.

Ed   June 10th, 2009 1:26 pm ET

This is a loophole that has to be corrected. But the solution will bring a whole new bag of worms. What about actors, rich people, etc. who go overseas and have their ATM card & their accounts have 6, 7 or 8 digits behind them. Does this have to be reported as well?????

jds   June 10th, 2009 1:26 pm ET

It's time to legalize drugs, especially marijuana, which accounts for approximately 60% of all revenues of Mexican drug cartels. Why are American citizens content with letting these people reep billions of dollars a year in profit when Americans themselves could be operating dispensaries, and paying taxes on those sales?

JMikey   June 10th, 2009 1:26 pm ET

Yet another problem in the war on drugs. There is no end to it and the violence gets worse every year. When will the politicians ever learn. If we want to end the violence we must change our drug laws. We could start with Marijuana. Once people realize the world will not end as a result of legalizing Marijuana other drugs could be decriminalized. We must take the drug problem out of the hands of the criminals, and the only way to do that is to take the monetary reward off the table. The war on drugs is really a war on ourselves. How stupid is that.

Hank   June 10th, 2009 1:27 pm ET

Legalizing drugs would probably only include pot not cocaine and heroin, so you would still have the same problems unless you made pot, coke and smack legal as well.

michael   June 10th, 2009 1:27 pm ET

Umm, Visa offers these gift cards to Americans travelling abroad to protect us from identity theft and those that would use our bank accounts for their own ends. It isn't a loophole it's a means of using legitimately earned dollars overseas without opening yourself up to fraud or thieves. How are these different from credit cards other than stored cash value other than a loan which could just as easily be forgiven by a dirty bank? Are they now going to make travelling Americans carry cash? That makes wonderful sense. Not! This is going to lead to some knee jerk reaction that harms us all. Law enforcement types jump on anything they don't understand and think is bad. They need to join the 21st Century and get ahead of the curve, but this isn't the way to do it. The money is going to get overseas no matter what – via cash, gold, diamonds, credit cards, or these gift cards.

If you want to stop the drug industry (and it is an industry), quit bombing Iraq and Afghanistan and bomb Colombia, Mexico, and Nepal where they have killed millions of Americans using drugs instead of bullets.

Jonathan   June 10th, 2009 1:29 pm ET

"War on Drugs"? more like "War on Minorities"

No comment, but...   June 10th, 2009 1:31 pm ET

Please read "Sense's" input on this matter- simply put, that's what all this is about, 110%, period, end of discussion. This individual nailed it in a few simple senteneces... Thank you. Hopefully, it will get through...

Montana   June 10th, 2009 1:31 pm ET

Think outside the box? How about this... lets develop some kind of an immunization against the effects of these drugs. A shot or pill we could give our kids, so they would never feel good from using certain drugs. Immunize everyone and there is no more market, thus no more problem.

j   June 10th, 2009 1:33 pm ET

Gift cards? Get real. Do you really want the Feds looking at what's in your wallet whenever they want? I'm not saying look at suspicious activity, but where does the slippery slope of giving away freedom for security end? Who defines "suspicious" activity? The terrorists and drug lords have won. We've given away the very rights, freedoms we fought and died for in the name of "national security". Soon we will have neither freedom nor security.

eagle1966   June 10th, 2009 1:34 pm ET

One of the biggest money laundering operations around is Bank of America, the illegal are making tax free money in the U.S. and making their deposits at BofA, and their family members in Mexico are getting it out with bank cards. BofA is all over Mexico Search the web you will see.

Mark352   June 10th, 2009 1:34 pm ET

How about we focus on the root cause of the issue, rather than the symptoms? These drug cartels work specifically with drugs due to the fact that by being illegal, the drug cartels create, or it could be argued they are provided with, the illicit black market where they can conduct their own business.

A regulated and taxed market for cannabis, and more importantly, industrial hemp stalk, would provide millions with jobs, and would create billion dollar industries, all while taking away the large majority of profit away from the violent illegal drug cartels.

Obama has talked of "sensible policies based on facts, not political ideologies", so I'd like to see him put his words to action.

Christian   June 10th, 2009 1:35 pm ET

Legalizing drugs is not the way to go. Alchololism increased when it was relegalized in the early part of the century.
Any addict will tell you the worst drug is alcohol.
Tough drug enforsement is the way to go. Mexio has finally stepped up and started cracking down hard on the traffickers and most important the top corrupt politicians to the small town mayors.
Here in the United States we can't compare ourselves to other countries. Our mentality, culture, way of thought is diffrent. Anyone who has spend time in other civilized countries will tell you that. To legalize drugs would not be the answer. We have responsibility to our selves and to educate our children.

Leslie   June 10th, 2009 1:36 pm ET

Well said, Bryan!

Gary Andersen, Northridge, CA 91325   June 10th, 2009 1:36 pm ET

It is time we legalize drugs in this country. We have to stop trying to win a 'war on drugs' that we cannot win. We spend entirely to much time thinking that taking away something from the population will make it just go away. Unfortunately, that is the biggest draw. Tell me I can't have it and I want it more. We will keep making the cartels richer, our borders weaker, and our children more in danger because of street drug violence. If we legalize, educate, and pull the drug dealer of the street we are at least in the right direction to correcting a huge problem. We keep thinking drugs is an immoral thing to do. Even if it is, you can't legislate morality. Legalize drugs now before all third world countries are drug lords.

kaos   June 10th, 2009 1:36 pm ET

Legalize weed. Let simpletons get hooked on crack and heroin. Sell them high, high priced counter drugs if they want to get saved. The thugs laughing at cops and judges because they refuse to pay the fines and sentenced to a crowded jail or prison only to be let out the "back" door. Repeat offenders know this trick.

Brian   June 10th, 2009 1:38 pm ET

Clearly some people have not even bothered to read the article. They saw the headline and that was it. These are not "gift cards" and they are not issues by US banks. They come from banks in other countries that we don't control.
Also, for all the people that think that legalizing drugs would make things worse: I don't know, maybe you're right, but that doesn't change the fact that the Federal government has no right to tell people what they can or can't put into their own body. It's anti-freedom and it's un-American.

Sniper   June 10th, 2009 1:38 pm ET

What a great idea! Man they get smarter and smarter than our government by the minute! I love the guys who loaded a propane truck with marijuana & made it accross only to get pulled over for spelling propane wrong. Shouldn't have smoked before delivering I guess. Either way; I agree; put the Cartel's in DC & at least something will get done, they obviously are experts in the cash flow business & could be the answer to fixing our economy! Yes leagalize drugs if you REALLY want the problem to go away, but of course that is TOO EASY! We must drain our American's of every last tax dollar to fight "war on drugs" and bail everyone out. Good Job DC..

Ed   June 10th, 2009 1:38 pm ET

Legalize drugs already! This is THE PROHIBITION OF THE 21ST CENTURY! Let's realize that the demand to use drugs will NEVER go away...like Alcohol or cigarettes/cigars. We, as taxpayers, pay billions to fight it and billions to incarcerate people and who knows how many billions for health insurance costs but the drug dealers keep all the cash. It needs to be taxed!!!

We cannot afford to keep this "conservative", aka Status Quo strategy that is a complete failure.

Besides, has there ever been an overdose of marijuana? Doubt it.

Sean Wynn   June 10th, 2009 1:38 pm ET

Honestly, everyone that mentioned that it is a waste of the governments time to regulate these "cash gift cards" is right. By the time congress approves a regulation to stop or monitor these cards, the drug lords and cash handlers will have found a new way to move their cash around. The cold hard truth is that we make a lot of money as a nation and as a government off of basic economics in regards to this subject and also in the form of "slush funds." A lot of you may not know what sluch funds are but the CIA does. The bigger picture of drugs and the international economy is closely regulated by our government. If you honestly want to have a hand in these decisions, you need to work for the FBI, CIA, or other federal agencies. I am currently pursuing some of the above and study international business and these matters very closely.

Dave From Philly   June 10th, 2009 1:40 pm ET

Legalizing drugs is not the answer. The answer is to delcare war on the drug smugglers and have their countries cofiscate everything they own.

If we can get rid of Sadam why can we get rid of a few drug dealers?

Hoser   June 10th, 2009 1:40 pm ET

As the US swings left, the risk of government confiscation increases and, naturally, folks will take defensive measures (i.e. hiding money in the Cayman Islands, out of the way of US income tax authorities).

As we become a Third Wold nation, you will start to see the unthinkable: massive flight capital moving out of the US instead of in.

In this case, the "war on drugs" is just a pretense for keeping "the rich" from moving their assets out of the country.

Chris   June 10th, 2009 1:41 pm ET

Legalize drugs = problem solved.

jack h   June 10th, 2009 1:42 pm ET

legalize all drugs and release all those in prison for possession and sales of drugs. this gov would save billions in the first year. that money could be spent on health care and the education and treatment of drug addicts. thay war on drugs is a scam that was doomed to failure.

Doug Harrod   June 10th, 2009 1:43 pm ET

Let's just legalize everything and it will solve all our problems! Alcohol is a drug and legal. It doesn't cause any problems at all in our society. So lets make pot, cocaine, meth and everything else legal because like alcohol use and abuse, they will not cost our society a thing. If you honestly believe you will not have problems at the same level by legalization of controlled substances then you have been smoking the weed to much already. Alcohol is here to stay, but lets not compound our problems even more by the naive idea that legalization will solve our use and abuse problems.

nap3null   June 10th, 2009 1:44 pm ET

If you legalize it, might as well legalize other crimes and make the same comment: "They are doing it in X and their rate is low." What's next... legalize rape? We are becoming more and more oblivious to serious matters and we or our children will pay for it.

Who are the dummiest taking the drugs? They are mostly in the United States, a country blessed with over abundance that people don't know what to do with their money.

michael   June 10th, 2009 1:46 pm ET

PJ,

Check your facts. There is most likely a bigger drug problem among minorities. Sorry

JJ   June 10th, 2009 1:46 pm ET

We lost the war on drugs years ago. It is time to throw in the towel and turn a bad thing into a good thing. Stop wasting money fighting drugs and start making money by taxing them. I think that drugs, all drugs, should be legalized but come with certain limitations just like alcohol. Set a minimum age, then you will only be policing part of the population with drugs instead of the whole population, thus saving money and in turn raising money through taxes, through the taxing the policing and controlling the drugs can pay for itself. Then ODing on drugs would be just like killing yourself with alcohol poisining, your own fault so oh well.

JT   June 10th, 2009 1:48 pm ET

Come on, legalizing isn't going to do anything except make more people co-dependent on freakin drugs! Pot is a gateway drug, it's been proven over and over.....there is no way to control it, so I would instead like to offer this solution: I will be happy to spend a LOT of that money they are smuggling in here...
How do we locate them? Maybe this message will reach them:
yo, mi amigos, por favor, send mee theese cards man, and I weel be hoppy to buy me a new Chebby and go see de sites of dee contree.
You no hov to wurry about dee monee, you can trost me.

There, problem solved.

john   June 10th, 2009 1:49 pm ET

We must legalize instead of worry about all this and spending boatloads of money

C   June 10th, 2009 1:49 pm ET

June 10th, 2009 1:31 pm ET
Montana
Think outside the box? How about this… lets develop some kind of an immunization against the effects of these drugs. A shot or pill we could give our kids, so they would never feel good from using certain drugs. Immunize everyone and there is no more market, thus no more problem.

You sir are a terrifying person. That is honestly the worst and most evil idea I have ever heard. Welcome to 1984

Ben   June 10th, 2009 1:50 pm ET

"The govt. needs to be able to track large/suspicious deposits" – They already do, it's called the Patriot Act.

I love how so many people on here think the govt should "track" the cards, the balances, the purchases, etc. The ignorance displayed by these people is the biggest threat to what remains of our freedom.

JayP   June 10th, 2009 1:52 pm ET

Legalize. There is no way to control or stop the drug flow. Take away the demand and the problem goes away.

LB   June 10th, 2009 1:54 pm ET

Bryan – are you out of your mind. What makes you think that legalizing drugs with taxes will make the thugs lawful. They'll find a loophole out of paying taxes and continue to shuffle drugs underground. I'm afraid we'll always be chasing the drug trade tail, my friend.

A Man In Houston   June 10th, 2009 1:54 pm ET

Hey look at Oakland, California. Just in that small city medical marijuana generated 6.3 million dollars in tax revenue. OK now imagine 70% of American cities generating that number. Now imagine it being legal for recreational use (like alcohol). Remember people, more than 75% of Americans use marijuana. That’s a lot of cash local and federal government can be making. I don’t smoke.....but, I'm not stupid!

Maybe we should make alcohol illegal......yeah that worked!

Adam   June 10th, 2009 1:55 pm ET

Is everyone crazy? Americans are so stupid it makes my head hurt. Take a look back at the history of alcohol prohibition and try to guess what the only way to win the drug war is? That's right folks, taxes and regulation.The cartels are the ones who lobby to keep the drug war going. It is making them billions.The American people are being played for fools right now, enforcing a prohibition that keeps Mexican sleazebag drug lords riding in yachts.

steve   June 10th, 2009 1:55 pm ET

war on drugs = countless$
legalization's detrimental cost = countless$

closing the border = priceless

steve   June 10th, 2009 1:56 pm ET

close the boarder

steve   June 10th, 2009 1:58 pm ET

close the border

Susy   June 10th, 2009 1:58 pm ET

The solution, legalize and tax drugs. The states and government would have control and make a profit. Alcohol and smoking are legal they are also bad for you like many drugs. We can spend billions of dollars to try to fight it, or we can regulate it and tax it and benefit the country not the drug lords.

Bayou Billy   June 10th, 2009 2:00 pm ET

>jon

You're absolutely right! And to take it a step further, if we were to punish Jaywalking with Summary Execution, nobody would do that, either!

Congratulations, you've officially endorsed the policies of Vlad Tepes, A.K.A. Vlad Dracul, A.K.A. the inspiration for Dracula. He'd kill for theft. To illustrate the effectiveness of his draconian policies, he was known to leave a solid gold cup on the Village Well and point out no one would dare steal it.

You have the morals of an all-time Baddy. Well done.

confussed   June 10th, 2009 2:00 pm ET

Wow! This country seems to be chasing its tail

Joe Smithe   June 10th, 2009 2:00 pm ET

The get the money on the cards by loading them. It may be a bunch of smaller deposits rather than one huge deposit so no one thinks to look more closely. A thousand here, a thousand there... they are patient.

michelle   June 10th, 2009 2:01 pm ET

NOT GOVT'S BUSINESS TO SEE HOW MUCH MONEY I HAVE!!! I understand the "need" to crack down on drug smugglers...actually wait, I do not see the need. But I digress.

If I wanted to just carry cash around, I would be suspected of trying to cover up something. But plain and simple, nobody should need knowledge of what I do with my money or how much of it I have. I hate banks. I just got a bank error in my favor, but that means it could sometime go against me as well. I"m sick of the government feeling like everything I do is somehow their business.

Legalize trivial drugs and tax them. Instant booming economy.

JC   June 10th, 2009 2:01 pm ET

Totally agree with legalizing marijuana. But you realize that if Obama legalized pot, he would catch holy hell from every Republican looking for another reason to attack him. Please remember what you said here.

John   June 10th, 2009 2:03 pm ET

Legalizing drugs does not mean that all drugs have to be available through the liquor store. Hard drugs, i.e. heroin, cocaine, etc. could be distributed through health clinics. This has many benefits:

1. Addicts could be exposed to opportunities to find treatment.
2. There is no one out selling the drugs on the street trying to increase the number of users, because there is little profit in it.
3. The violence ends, b/c the money is out of it.
4. Law enforcement and prison costs fall dramatically.
5. Our borders become less pourous, as there are fewer people looking for ways in with illegal products

Holland has had defacto marijuana legalization for years. Their crime rates and imprisonment rates are far lower than ours.

Animal House   June 10th, 2009 2:04 pm ET

Legalize smuggling, then tax it............oh yeah, that's called economic trade ,isn't it?

Nelson   June 10th, 2009 2:05 pm ET

This is a fascinating story and an example of how the drug cartels will continue to adapt their business no matter what governments do to stem or stop the drug trade.

Although I must admit not being certain whether it would be successful, I would be curious to see the United States run a pilot program for a 3 year year period where it legalizes marijuana. As part of that process both the state and federal governments would be allowed to tax and regulate the sale of the product. I strongly suspect that removing the legal risk for the end user will decrease the profitability to traffickers and decrease but not eliminate the level of criminality.

If the experiment were a success then perhaps it could be expanded to other substances.

Anything has to be better than throwing billions of dollars annually with little to nothing to show for it.

Joe Smithe   June 10th, 2009 2:05 pm ET

BTW, this does not mean the banks are shady. They often sell them because not everyone wants/qualifies for credit/debit cards, and people opt for the pre-paid cards instead- especially around Christmas to stick to budgets, etc. So it is not always a conspiracy that the banks are involved in, as "Common Sense" said. Some people just use them as a way to manage their money.

joe schmoe   June 10th, 2009 2:05 pm ET

the people at the beach are praying for sun, the farmers for rain. personaly I hope they make alcohol illegal too so i can make big bucks of selling that as well! My whole garage would be a stihl if that happened!

as for now, drugs will remain illegal, and the average person will continue to suffer from it, while politionas will be lobbied by drug makers and budwiser, cops will be paid and not laid off, prison gaurds and thier unions will continue to florish and yes smuglers as well.

put us out of buisness, legalize, never gonna happen............

Matt   June 10th, 2009 2:05 pm ET

Legalize Drugs.

Obama could get a lot of mileage out of even just legalizing marijuana and taxing it. In my humble opinion, Obama could come away as one of the shiniest Presidents ever if he gets us out of this economical rut with a solution like marijuana legalization and taxation.

THERE YA GO, MONTANA!!!! Just like Orwell predicted .... give us all shots in order to make us not feel a THING, huh? You numbskull!

Common Sense is correct here. Misdirection provided by our corrupt politicians is abound.

Prohibition is a Failure   June 10th, 2009 2:07 pm ET

Look at all these losers who think that by enacting more laws and better enforcement, drug prohibition will work. Politicians who just want political power by being drug prohibitionists.
In fact, prohibition will never work. Never has, never will.
The only solution is legalization and regulation, just like tobacco. No other response has any credibility. Politicians should quit wasting my money in an impossible-to-win drug war.

john brown's body   June 10th, 2009 2:07 pm ET

Whats next, checking peoples bank accounts? Lets think this stuff through fellas.

jeremy   June 10th, 2009 2:10 pm ET

Let's legalize the plant and go after the real culprits... the pharmaceutical companies!

none   June 10th, 2009 2:10 pm ET

I do not want the government to be able to check all my cards/accounts to see how much money i have every iem i cross the boarder.

I barely have any money, but they do NOT have the right. They should NOT have the right.

We have already sacraficed too many of our rights lately, just say no to anymore of this crap.

You want to stop drug cartels, you need to legalize the durgs. Prohabition does NOT work. I do not use drugs, i WILL NOT use drugs if they are legal. I want the cartels gone and legalization is the way to do it.

Prohibition FAILS   June 10th, 2009 2:14 pm ET

Goddard and people like him are a bunch of idiots. NOTHING they do will stop the problems caused by illegal drugs EXCEPT for ending prohibition. PROHIBITION IS THE CAUSE OF ALL THIS MESS. And the government knows it. They keep taking your tax dollars and screwing the American taxpayers because people like Goddard have God complexes and are greedy, power-hungry bastards who can't see the forest for the trees.

If they had one iota of sense in their heads, they'd do the right thing and end prohibition. Ending it would bring the cartels to an instant demise.

Google "portugal drug legalization" and read the TRUTH about how well ending prohibition works. IT IS PROVEN.

adam12   June 10th, 2009 2:15 pm ET

OK, so we can no longer buy gift cards because drug dealers accept them. Has this Arizona guy ever stopped to think that drug dealers also trade for televisions, video game systems, computers, cell phones, cars, guns, gold, diamonds, new clothes, and anything else valuable? Are you gonna prohibit the sale of all of this too? Never give in to the drug dealer by sacrificing your own personal freedoms and means. In the 1940's the gangsters were shut down in two ways, the government legalized alcahol, and later seized control of legal gambling. This took the gangsters main 2 sources of income away. If they would just legalize marijuana, it would put at least a third of the dealers out of a job. Make it have the same laws as alcahol and the same taxes as tabacco.

ChrisH   June 10th, 2009 2:16 pm ET

I think what Goddard is trying to get at is; that it does not matter what kind of card it is.

With little knowledge you can erase the information (on the magnetic strip) from a hotel room key card, and replace that information with information from a credit card (look up ATM skimming).

Here is an even better idea. With an RFID programming kit: one could erase the information from an Exxon SpeedPass or anything with an RFID chip and reprogram it to read just like a new Visa payWave Credit Card. The newly reprogrammed item would not even have to resemble anything used in commerce.

This would all work as long as these offshore banks issue some sort of card or electronically identifiable means of conducting a transaction.

The solution will not be to track these cards or whatever. The solution is to work with these banks and countries with less stringent guidelines, but that will never happen. The most that will probably ever happen; would be to not allow American banks to conduct transfers with these offshore banks, or to disallow any of these banks from having branches within our borders(even then there will be plenty of countries that will work with them and then transfer from there to here). Who are we to tell another country what to do.

Legalization will probably be the only way we will ever be able to restrict drugs.

Prohibition FAILS   June 10th, 2009 2:19 pm ET

One more thing... "decriminalization" is NOT a solution. Mexico has recently done this but it is a useless ploy to appease anti-prohibitionists. Decriminalizing drugs does nothing to solve the problem, though it does help users stay out of jail. The problem with decriminalizing drugs is that the government knows it won't work so they do it to pretend like they're doing what the people want, but in fact, they will turn around in a year or two and say, "Oh lookie, taxpayers, see, legalization doesn't work!" but that's going to be an all-out lie because they haven't legalized.

LEGALIZATION AND THE END OF PROHIBITION IS THE ONLY ONLY ONLY SOLUTION

Carolyn   June 10th, 2009 2:21 pm ET

I've been in Wal Mart and other places where as many as 10 of them will be in line waiting to load the cards up to the $999 limit. The same people get back in the line several times to load more cards. The clerks don't ask for ID, because the cards do not require a name on it. I.E. Visa, Master card etc. WalMart actually sell their custom made cards right on the spot regardless of who buys them. But this is what puzzles me. The same people will get back in line to send money from the card to Mexico or places no one seems to know or care where they send it. In addition they use the cards to pay for housing, food, cars/gas etc (so much for all the taxes they are supposed to be paying) Here's a thought; make it illegal for non citizens to buy the cards and penalize anyone who sell to them with a little jail time.

Mark   June 10th, 2009 2:23 pm ET

Legalize drugs? You all Dummies or what? By legalizing Drugs you just legalize Rape, stick ups and manslaughter as well! Imagine your self walkin in a place where drugs has been legalize! There will be no safe place for your kids to go! US gov is using their millions on battling terrorism and by invading other countries with internal problems such as Iraq and Afghanistan! Why dont they just center this millions to fight drug trafficking instead! Its worth it! they have special forces fighting overseas when the real battle is taking place inland! US gov has the power to fight this stuff and everyone in the world knows it! Unless of course theres people in the US govt taking advantage of earning millions with drug money!

Rae   June 10th, 2009 2:27 pm ET

I think we need to legalize drugs, and that's it, period. At least that way we can spend money on regulating it, and get tax dollars from it also. Let's face it, the drug lords have won this war, and if we keep going into battle, then we will lose millions, maybe billions, and the drug lords will still win.
Simple solution: Legalize drugs, tax them, regulate them and then we are closer to being out of the national debt. We wouldn't have to pay people to figure out new ways to bust these people. We wouldn't have to spend our hard earned dollar in the courts prosecuting these people. We wouldn't have to spend our hard earned doller keeping these people in our prisons while we pay more money for every appeal!
People are going to do drugs whether it's legal or not. I don't think by legalizing drugs we would have to worry about a million more people smoking weed because it's now legal. People are going to do what they want to do, it's the human way!
Maybe people would be more relaxed if we did legalize marijuana, instead of getting a prescription for an anti-depressant, they can get a bag of weed, and go home and smoke it!

Davio   June 10th, 2009 2:35 pm ET

You must be kidding me with these suggestions of increasing penalties for those who use drugs. Dont you get it, the war on drugs is bs like a few have stated drugs fuel much more than just the drug dealers. Its an economy within its self, law enforcement, the legal system would have very little to do if it didnt need to deal with drug related crimes. The US government makes millions if not billions in the drug trade, the government keeps it illegal so the profit margins remain what they are. The US is the largest drug dealer and gun dealer in the world, the us sells more drugs and guns than the cartels u can be sure of that

David Rogers   June 10th, 2009 2:41 pm ET

America does not need to police the word. And saying that legalization won't work is flat out stupid. No one is going to shoot anyone over something that is for sale at any type of retailer. When was the last time there was a big issue over alcohol? Actually the tides have turned on alcohol again and is a far worse substance than most organic mind altering substances.

I say organic because they do not require human processing or interaction, it just grows like that. Legalizing will solve a majority of this world's problems. One reason being that America would no longer have to be in everyone's business about the #1 Cash crop in the world, cannabis (opium in other parts but that's geological I'm speaking on the world as a whole)

You won't have drug lords if you don't have illicit drugs. Then they can't sell drugs in mass quantities. They will have to resort to child smuggling, people smuggling across borders, prostitution rings, gun trafficking. There are so many more issues that need to be attacked with my tax payer dollars.

I'd rather have my tax dollars go into busting a meth lab in the boondocks than a medical marijuana dispensary in California. It's a simple decision legalize. Clearly drugs would be labeled for adults above a certain age. It's not like children would have access to it. Alcohol isn't even perfectly regulated, there are people out there manufacturing moonshine out in their backyards.

What is the big deal about this whole legalization issue? Just do it.

BakedatBofA   June 10th, 2009 2:51 pm ET

It's not illegal in Portugal.
Please Read:
http://www.time.com/time/health/article/0,8599,1893946,00.html

JayWun   June 10th, 2009 3:00 pm ET

Our government should push for more regulation not only of offshore or foreign banks but domestic banks as well. We are so quick to point the finger at other countries when the corruption and greed is going undetected right under our noses.

dagny taggart   June 10th, 2009 4:14 pm ET

It's not just about the drugs. It's about shielding income offshore. If not the Caymans, maybe Costa Rica, Panama. With the specter of higher taxes and litigation there will be a greater demand for cash.
Capital flight, just what the drones voted for!

dan   June 10th, 2009 4:39 pm ET

To "Pep" (who thinks every drug user deserves "life in prison")

You are a fool. The prisons in this country are already over populated. Lots of them are non-violent offenders. We don't need to add more non-violent offenders to this over population problem. Drug users are not a threat. Many of them may need help. However plenty of people who use drugs just do it occasionally for fun. They have their lives well in control. By the way haven't the last 3 presidents all admitted to using drugs? Should Clinton, Bush and Obama all be serving life sentences? Are you serious Pep? Could you possibly have thought of a dumber solution to this problem? I know drug users that are Doctors, lawyers, teachers, and POLICE OFFICERS!!! Yes thats right the ultimate hypocrites. It is time to legalize marijuana and other lesser drugs. Heroin and crack can stay illegal. Those substances can kill quite easily. (but then so can alcohol) But the Cartels are not going to be taking over Mexico with only heroin and crack sales. Marijuana sells all over America... Anyone denying that has had their head in the sand for their entire lifetime. Lets use this money on something productive for a change...

dan   June 10th, 2009 4:53 pm ET

To Mark

Legalizing drugs does not = legalizing rape.

Where do you get such ridiculous ideas? What is wrong with you? If drugs are illegal why would someone kill for a drug they can buy at any convenience store? Do people get mugged or "raped" for alcohol everyday??? Have you thought this out at all??? Clearly you have not. You say there will be "no safe place for our kids to go". Why because every drug user is equal to a murderer? Obviously you are a feeble minded person that has bought all the propaganda that you were taught in grammar school about drugs. You have no mind of your own. Guess what buddy DRUGS ARE EVERYWHERE ALREADY... But you kids are just fine aren't they?!?! Legalizing drugs won't put you or your kids in danger at all. In fact if you live in Arizona, New Mexico or Texas your kids would be SAFER if drugs were legalized!!! You are beyond foolish, you are just part of the problem. You are simply fear mongering so we can never make any progress. People like you will keep us in the stone age forever. Go away.

Dorothy   June 10th, 2009 4:54 pm ET

This is not about drugs. This is organized crime. If we legalize the drugs then they will turn to other avenues to make money. Think back through the years the different ways organized crime has made money, i.e. copying music/movies, human trading, gambling. These type of organized criminals need to be stopped. Legalizing the drugs will do nothing.

tycraz   June 10th, 2009 7:32 pm ET

The little item not addressed: Two people asked about it, one went to the logical conclusion.

First the scenario: The drug organization smuggles drugs into the good old US, sells drugs for cash, has truckloads of small unmarked bills.

Then they need to get the cash back to the home country to buy more drugs to complete the circle. Here in lies the problem...

How do you get the cash to the Cayman Islands to the "dirty" co-operating bank?

Lets think... you smuggle the truckloads of cash out of the US to the Cayman Islands so you can then get Gift Cards issued in the US so you can smuggle them across the border to Mexico? What, are we stupid? Once the cash is on boats, can't you just dock it in Mexico, Columbia, or wherever you want?

My take on this is that it is just more Gov -Co crap to distract us from the real issues. Another excuse to get us to pay them more, more control, more scrutiny, less privacy, less rights, no freedom. My take on this is that the AZ Attorney General is lying.

Please let me know if you can see a way to convert truckloads of cash to gift cards without using a bank in the US. If you are using a bank in the US then there are names and numbers attached to it. Why blame the Cayman Islands, if you can get the cash to the Cayman Islands, you can get it anywhere.

The problem is getting the cash out of the US without using a bank.

Top Posts « WordPress.com   June 10th, 2009 8:48 pm ET

[...] Official: Drug lords using 'gift cards' to smuggle money Arizona Attorney General Terry Goddard says Mexican drug cartels use gift card technology to smuggle money across the [...] [...]

hoboduke   June 11th, 2009 7:59 am ET

This is easy! Have American Express the official gift card issuer. They will eat up the money with monthly fees, short expiration date, and restrictions on where it can be cashed! With a little luck we will get all of the illegal money without using any police!

Official: Drug lords Using ‘gift cards’ to Smuggle Money « Mexico Institute   June 17th, 2009 9:48 am ET

[...] Read more... [...]

yogi   September 11th, 2009 10:12 am ET

Just think if all the money from the " Drug War" had been going into a healthcare program since the 80's went into healthcare and education. Where could we have been today ?
MAINE VOTERS VOTE " YES " ON QUESTION 5 !

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