ACLU of Arizona

June 1, 2006

Transcript:

José Càrdenas
Good evening and welcome to Horizonte. I'm José Càrdenas . Financial institutions are being used to move illegal money from criminal activities. We will talk about the impact on the banking industry and how it's being investigated. Also you may have read about reports of telecommunication companies turning over private details of customer phone calls to the national security agency. Hear from the new executive director of the Arizona ACLU about this issue and more. And the Thunderbird School of International Management in the west valley celebrates its 60th year anniversary this year. All this up next on Horizonte. The FDIC, the Arizona Financial department of Financial Istitution and the Arizona Bankers Association held a seminar called banking on the border. As much as $2 million (correct figure:
$2 billion) a year comes into Arizona from the fraud to undocumented immigrant trade. People in the banking industry are being cautioned about how they can identify money being moved illegally. Here to talk about this is assistant special agent in charge of investigations, Terry Tollefson. Also here is Ernie Garfield. Mr. Garfield is chairman of Scottsdale Interstate Bank Developers. Agent, Ernie, welcome to Horizonte. You have been here before. Let me start with Agent Tollefson. We talk about illegal movement of money. We are talking about money laundering.

Terry Tollefson:
That's correct.

José Càrdenas :
What's the definition of that?

Terry Tollefson:
Money laundering seems like a very complex issue. But it's very simple. Really all it is the attempt or the concealment of the identity, the true identity of the owner of the money or the origin of the money. The, what the activity was that produced the money.

José Càrdenas :
Ernie, I think when people hear money laundering they are assume massive aamounts of money involved, but I understand that's not necessarily the case.

Ernie Garfield:
That's correct. This is a relatively new phenomenon, in my opinion. The suspicious activity reports that are filed usually involve sums over $10,000. And in Arizona , my understanding that we filed the largest number of suspicious activity reports in the country. What is happening now, however, is some of these folks are operating under the radar screen and they are doing it in transactions like $1,500 to $2,000 per transaction. So if you have a million of those a year, and they go under the radar screen you are talking about a couple of million dollars in transactions that are being falsely done.

:
Terry, why is ICE involved in this? Give us a little bit of background on ICE.

Terry Tollefson:
Well, ICE was formed after 9/11 with the formation of the Department of Homeland Security. And what ICE, Office of Investigations is it took all the, what we refer to as legacy immigration special agents, married them up with the legacy customs special agents to form Immigration and Customs Enforcement Office Investigations. There's other areas of ICE, such as detention and removal, and Office of Intelligence, but what I am assigned to is office of investigation. And what that did is it took all the investigative reports of legacy INS with Legacy Customs and married them up together. So not only do we investigate human smuggling, work site enforcement, which are traditional immigration charges, but we have narcotic smuggling, financial crimes, child pornography investigations, strategic investigations, the transport of military items to countries that we shouldn't be trading with. Commercial, there's a whole host of authorities and jurisdictions that we investigate under ICE.

José Càrdenas :
As I understand it you come from the customs side of the house.

Terry Tollefson:
That's correct.

José Càrdenas :
And the focus on financial crimes, why now?

Terry Tollefson:
Well, under customs, financial crimes was always a focal point. Customs agents were traditionally renowned for their ability to conduct financial investigations. What has happened with the merger of ICE is we have brought that expertise to the title or immigration charges and married it up with the human smuggling. And it's a very powerful tool. We can look at human smuggling and other traditional immigration charges with a new eye and that's the financial, going after the money.

:
And in what way are you doing that? I understand there's some special initiatives or operations that are underway or targeted at human smuggling organizations.

Terry Tollefson:
There's a whole host of ways. Most significant way is targeting the -- is evaluating where the money is coming from and where the money is going to. Following the paper trail, full, the money trail to identify the leaders of the organization and the infrastructure that allows the activity to take place.

José Càrdenas :
As I understand it, in addition to the criminal investigation there's a companion asset investigation that's designed to deprive these organizations of their assets?

Terry Tollefson:
Correct. In many every investigation that ICE works, certainly with regard to human smuggling and narcotic investigations, we open a companion asset and forfeiture operation. And that runs parallel and that's focused on identifying the assets so that when we take the case down, we know where the assets are, we have identified them, we can seize them and seek to forfeit them to the government.

José Càrdenas :
Any sense of the impact these efforts are having on these organizations?

Terry Tollefson:
Well, we know in FYO 2005 for ICE nationally we seized approximately $1 billion in cash and physical assets. We know in Arizona , here in Phoenix , the Phoenix office, in FYO 2005 seized approximately $4 million in assets just related to human smuggling. That doesn't even take into account our narcotics investigations or any types that we have conducted.

José Càrdenas :
As I recall that included some motels and other assets.

Terry Tollefson:
The motels were actually would fall into FYO 2006. But that's correct, we have seized, criminally indicted six hotels for human, for facilitating or being involved in human smuggling.

:
Ernie, tell us about the seminar "Banking on the Border."

Ernie Garfield:
It was excellent. It was exposing people in the banking industry to some of the problems that are going on that we weren't even aware of. And frankly, I don't think the public has any idea of the extent of this. For example, when we talk about $1 billion, that's an infinitesimal amount of the total sum of money that's being transported across the country. When you talk about $2 billion in Arizona and only having $4 million that is infinitesimal. The impact that you're making is excellent and the cornerstone program is excellent, I believe. We have to team up with the ICE and with the attorney general's office and do our best to stem some of the problems that are occurring.

José Càrdenas :
Well, what are banks supposed to do these days as a result of these initiatives?

Ernie Garfield:
We need to know our customer. Bottom line. I mentioned to someone earlier, I went to Hong Kong a few years ago and wanted to start a bank account there. I couldn't start one because I didn't know anybody. We are not in that situation here. But since I deal mostly with small banks, because I start small banks, these banks are required to really understand the person they are going in business with. Because the character is important and occasionally you will make a mistake. I had one bank in Washington we hoped for that ended up taking a $2 million loss and we think that went to Al-Qaeda, so it can happen even to small bank that knows its customer. You have to take precautions because when money is involved people will do everything they can to get to it.

José Càrdenas :
Now, we are talking here, though, a particular focus on immigration. Was there any discussion at the seminar about what the bank's role would be in connection with immigration and money laundering?

Ernie Garfield:
Only in regards to participating, to understanding the problem, understanding the magnitude of it, understanding the elements of the industry that are most apt to be affected, and the bank should either be extremely cautious of or avoid. And the need to participate with the prosecutors.

José Càrdenas :
Can you give me an example of the kind of suspicious activity that would generate a so-called "SARS Report?"

Ernie Garfield:
Well, anything over $10,000.

Terry Tollefson:
Well, that would be a CTR. Anything over $10,000, a bank is required to file a CTR, to the IRS. What a suspicious activity would be is if someone, for instance, came in and when being told we were going to file or that the bank was going to file a CTR they divide it up or use multiple accounts or go from bank to bank in one day making smaller deposits. Things of that nature would probably generate a suspicious activity report.

Ernie Garfield:
Something I found extremely interesting was the software that you folks use that tracks the patterns that tell you whether the person is involved in, say, terrorism or involved in human trafficking or in drug trafficking. As an example, it was pointed out to us and I am not an authority on this, that a person that's involved in drug trafficking you will usually do the best to accumulate as much money as possible, whereas somebody involved in terrorism may channel a lot of money in the account but drains it because philosophically they are there to support a cause. So it goes elsewhere rather than there to buy homes and big cars.

José Càrdenas :
How many of an imposition is this on the banking industry?

Ernie Garfield:
Our cost now is around 20 to 23% total for compliance which includes many things besides this aspect of it. But it is a major part of our operational costs.

José Càrdenas :
Agent Tollefson, as I understand the seminar was part of "Operation Cornerstone." Any other aspects of that that are designed to mitigate the burden on the banks having an effect of being enforcement arms of the government in this area?

Terry Tollefson:
Well, what "Operation Cornerstone" is, ICE is seeking the partnership of the financial institutions, and in trade-based companies and organizations to identify people involved in illegal activity. Some of the requirements such as the CTR requirement and there's others, that the banks have to fulfill, that is mandated by law. And so a big part of Cornerstone is not only to seek this partnership but is to educate the banking industry and other industries as to what the law is and what their liabilities are and what their reporting requirements are.

José Càrdenas :
We are going to end the interview there. Thank you both for being on our show to talk about this interesting subject. Hope to have you back soon. Thunderbird, the Garvin School of International Management is celebrating its 60th anniversary this year. Since its founding 35,000 students from 135 nations have earned MBA degrees in International Management from the school. For 10 years running it has been the named the top U.S. Graduate School for International Business by U.S. News and World Report . Horizon host Michael Grant recently talked about the school's director about the future of the school.

Michael Grant:
We were talking before we went on the air here that in many respects locally, I mean, Thunderbird is well regarded internationally, but locally, sometimes it's one of the Valley's best kept secrets.

Angel Cabrera:
And there might be something to that. In fact, sometimes we joke that it is easier sometimes to be stopped as the president of the school in the Heathrow Airport in London and be asked from someone about the school than it is in our own backyard. There's a little bit of that. I think you might be a little exaggeration but we think there's a little bit of that.

Michael Grant:
There's a rich history to it, though. 60 years back. Now, what in the world drives a lieutenant general to found an international school of management and business?

Angel Cabrera:
Well, that's, in fact, a fascinating story. Really, towards the end of the war, it was clear to the U.S. Air Force that that air field wasn't going to be needed anymore. That was an air field that was used to train pilots. American, Chinese and British pilots that were then sent to the war. Towards the end of the war these generals had this idea that it would be very nice thing to turn that training facility to train different type of soldier. Maybe somebody that would build, create value and wild bridges around the world through trade and commerce, through foreign investment, and that perhaps through the work of these people, maybe we would be able to avoid a war like the one that had just finished.

Michael Grant:
Interesting. And, Thunderbird has executed on that plan really remarkably well. Where is it now? I know it offers a variety of different -- exclusively master's level degrees or not?

Angel Cabrera:
We have on one hand a number of master's degrees that are trying to cater to the needs of specific individuals, whether they are early in their careers or whether they are more experienced or even executives that are now getting ready to take top leadership positions in the companies. On the other hand, we do more and more work with companies. We were very active in executive introduction and some of the international media consider Thunderbird as one of the top 10 providers of executive education in the world. And we conduct programs all over the world-anywhere from Russia to western and Eastern Europe and Asia . We are very active in Korea , in Latin America and a number of locations. But I think throughout those 60 years, and perhaps the number of programs and the types of activities that we do have changed with time but what has not changed is the commitment to international management. The idea people who are going to be effective at running businesses and other types of organizations worldwide, not only need technical knowledge but they have to develop the competence in understanding other cultures, in being effective at working with people who are different from them. And that's what runs really underlying all the programs, all the activities that we conduct.

Michael Grant:
All right. Well, Dr. Carbrera, we appreciate you joining us and certainly congratulate Thunderbird on 60 years, and wish you the best of luck on 60 great more years.

Angel Cabrera:
60 more years to go, absolutely. 60 years educating global leaders who create sustainable prosperity worldwide. We hope to do that 60 more years. Thank you so much for having me.

Michael Grant:
Thank you.

José Càrdenas :
Last year the American Civil Liberties Union of Arizona announced a new Executive Director, Alessandra Soler Meetze is the first Latino to head the Arizona chapter of the organization. She succeeds Eleanor Eisenberg who led the organization for the last eight years. With us to join various issues involving the Arizona ACLU is Alessandra Solar Meetze. Alessandra, it's actually ACLU of Arizona.

Alessandra Solar Meetze:
Exactly.

José Càrdenas :
A change made a few years ago.

Alessandra Soler Meetze:
American Civil Liberties Union of Arizona .

José Càrdenas :
Before we start talking about the Arizona operations, give us a little bit of background.

Alessandra Soler Meetze:
Sure. I have been with the ACLU for about seven years now. I started out my career with the ACLU in New Orleans , actually. Worked there, we did a lot of work, addressing conditions of confinement for prisoners. I was there for about two years. And then transferred back to my hometown in Miami , Florida , where I was there for about five years. And I worked as a communications director there in Florida . And we had many, many civil rights issues to address there and so I was there. And recently relocated here to Arizona . So I am here to stay now.

José Càrdenas :
How did you come to be the executive director of the Arizona operations?

Alessandra Soler Meetze:
Well, it was a nationwide search. And it was, it's a step up for me and it's an organization I have been very proud to be part of for the past seven years. And it's we have tremendous potential for growth here in Arizona . We are the fastest growing, one. One of the fastest growing states in the country and also for in terms of civil libertarians. We have about an increase of 30% in members here in Arizona , and nationwide as well, and we are at the center of many, many important civil liberties issues here in Arizona .

José Càrdenas :
How would you describe the focus of the Arizona operations under Eleanor and in what way would you change, if at all?

Alessandra Soler Meetze:
I do think that for myself personally I would like to, one of my important goals is to begin reaching out to Latino community and really make us engender confidence in the community so we can become a resource, you know, from the very beginning. I see our role as an organization, an organization that should be informing people about their rights and so they know, for example, when they are dealing with, you know, police departments or know what their rights. I think that's an important role for our organization to do public outreach to the Latino community and just educate the public about our role as an organization.

José Càrdenas :
Nationwide and in Arizona how involved is the Latino community in the ACLU?

Alessandra Soler Meetze:
Well, I think it's a growing community. I think we are, you know, nationwide we are working to increase our political clout and really become a voice in the nations in politics. So I think for us, there, it's a community that's growing and we are working to reach out to the Latino community but I still think we have a lot of work to do. Realistically we have a lot of work to do, as far as reaching out to Latinos and young people and just really relaying that message about how important it is for us to, at this moment in our nation's history to really stand up for preserving fundamental freedoms. Because if not, you know, I think we all know we are seeing these threats very serious threats to our civil liberties.

José Càrdenas :
What does the ACLU offer to the Latino community that isn't provided by MADE, the Mexican-American Defense and Education Fund.

Alessandra Soler Meetze:
I think we work there owe litigations in many of those groups. I think we have a very specific role to play. We have in terms of producing materials that inform people about their rights, we are specifically, you know, as an organization, I mean, I think that's the one main message I like to convey to people-that we defend the rights of everyone in this country regardless of whether or not they are citizens, immigrants, and so the immigration, the immigrants rights community, they have particularly been hard hit by many of these policies and procedures that we saw after 9/11, and I think we play a very special role to play. We are many times the only organization that is standing up to the government that is filing lawsuits, that it's demanding accountability to our government. We are right there, front and center. I think that's a very important role that we do play.

José Càrdenas :
In what way do the issues you are dealing with here in Arizona differ from what you were looking at in Florida ?

Alessandra Soler Meetze:
It's interesting because here, for example, I can give you the voting rights. Voting rights is very, very obviously important issue in Florida but here, Arizona , we have become the first state in the nation to actually implement a proof of citizenship requirement when it comes to voting. And --

José CàrdenasJose Cardena:
And, that was as a result of prop 200?

Alessandra Soler Meetze:
Exactly, the result of Prop 200. We didn't change the requirements for voting. You have to be a citizen in order to vote. What we have done is essentially required proof now, of identification, before you, when you register, identification when you go to the polls. And I think say, for you and I that's something that's very an inconvenience but for many, many people including Latinos, including members of the Native American community, people who have traditionally been disenfranchised in Arizona, this creates what we believe is unconstitutional hurdles to voting. We should be making it easy are for people to vote, not more difficult. That is one of the very, very important issues here in Arizona .

José Càrdenas :
Is there actual proof, though, that -- we have had a few local elections since Prop 200 went into effect. Is there any evidence it has had that kind of negative effect?

Alessandra Soler Meetze:
There has been. The secretary of state has said that about, there have been thousands of ballots that have been essentially, you know, turned away that have not been accepted because of Prop 200. We don't have concrete figures because we have had such very small elections. We do know that in the March Maricopa County election there was an election there, and it was a very, very small percentage but 65% of the ballots that were centrally, of the individuals that were given provisional ballots, 65% of those people were seniors. It just goes to show you the seniors were the ones in that particular election were disenfranchised because they didn't have the proper identification. The way it works is if you don't have the proper ID at the polls, you are given a conditional provisional ballot and you have three days to come back with that necessary information.

José Càrdenas :
I assume another difference between Florida and Arizona is immigration.

Alessandra Soler Meetze:
Exactly.

José CàrdenasJose Cardebas:
What's the issue ACLU's involvement with some of the disparate groups involved at least in Arizona ? Minutemen on the one hand and then you've got Sheriff Joe Arpaio and his crew.

Alessandra Soler Meetze:
That dichotomy it's a very interesting. In terms of the Minuteman we certainly believe the Minutemen have the right to, they are protesting the federal government's immigration enforcement mechanisms and this is how they have chosen to protest that. And we certainly do support their right to express themselves in that manner. Our only concern is that when you do essentially cross the line and you become, you sort of begin to engage in that vigilante activity where you take on the role of border patrol or law enforcement and that is something immigration enforcement we really believe it should be reserved for the federal government, not private citizens.

José Càrdenas :
What about for county sheriffs like Joe Arpaio?

Alessandra Soler Meetze:
That's another very -- it's the same argument. Here we are, you know, earlier this year we talked about, we had federal officials, immigration enforcement officials, ICE officials who have a very sophisticated system of investigations and they are doing their job. They are enforcing federal smuggling laws. That is not a role for the local municipal sheriffs. I think that --

José Càrdenas :
Is ACLU taking a position against the Sheriff Arpaio?

Alessandra Soler Meetze:
No, we do believe it undermines the federal immigration system.

José Càrdenas :
Have you filed litigation?

Alessandra Soler Meetze:
We have not. We supported the litigation that's being implemented and carried out by the organizations out of California . But it comes essentially comes down to the fact that we have a state law that was passed, that the intent was to target human smugglers, not the victims of smuggling. And so this, we believe it's first of all going to harm taxpayers. Because you have county sheriff essentially forcing immigration laws, determining who's here.

José Càrdenas:
Let me ask you one last question. In terms of outreach to Latino community, ACLU is kind of leftest and Latino community is in many respects very conservative. We have about 20 seconds left. How do you respond to that?

Alessandra Soler Meetze:
We're traditional, been around in this country for 86 years. We are here to defend the traditional values of this country in terms of equality and fairness for everyone in this country. I think we are making a concerted effort to reach out to people in their languages, in Spanish, and really inform them about their rights. And I think that that's people -- we are defending these traditional values in this country of fairness and equality for all and it's an important world. We are principled.

José Càrdenas :
Time is up. Welcome to Arizona .

Alessandra Soler Meetze:
Thank you so much.

José Càrdenas :
For information on upcoming shows or shows that have already aired, please visit our web site at www.azpbs.org and click on Horizonte. That's Horizonte for this Thursday night. Next week, we will introduce to you a company that provides training and education for people in the construction industry. I'm José Càrdenas and from everyone here at Horizonte, have a good evening.