Steven W. Casteel
Chief of Intelligence
Drug Enforcement Administration
Judicial Review Commission on Foreign Asset Control
September 21, 2000
Note: This document may not reflect changes made in actual delivery.
Chairman Thompson and members of the Commission, I am pleased to have the opportunity to appear before you today, as you consider issues related to the Foreign Narcotics Kingpin Designation Act (hereafter referred to as the Kingpin Act). I will confine my remarks to the Drug Enforcement Administration's (DEA's) responsibilities under this act. First, however, I would like to thank the Commission for its hard work in this little understood area of drug law enforcement.
I am here today to address issues that concern the Drug Enforcement Administration as they pertain to the Kingpin Act, including the role of DEA in the designation of the Kingpin targets.
DEA's mission is "to enforce the controlled substances laws and regulations of the United States and bring to the criminal and civil justice system of the United States, or any other competent jurisdiction, those organizations and principal members of organizations involved in the growing, manufacturing, or distribution of controlled substances appearing in or destined for illicit traffic in the United States; and to recommend and support non-enforcement programs aimed at reducing the availability of illicit controlled substances on the domestic and international markets." The Kingpin Act is a tool to attack and disrupt drug trafficking organizations by 1) freezing the assets in the United States of targeted international drug traffickers, and 2) imposing sanctions against U.S. persons who knowingly have business transactions with the designated traffickers.
DEA is a single mission agency focused on drug law enforcement. Additionally, DEA is the forerunner in the collection, analysis and dissemination of intelligence on all narcotics traffickers and their organizations operating throughout the world. As a result, DEA serves as the central repository for all intelligence gathered by the Federal law enforcement agencies and the intelligence community on potential targets under both the International Emergency Economic Powers Act (IEEPA), as applied to Colombian Drug Traffickers by Presidential Decision Directive 42 and Executive Order 12978 which were both issued on October 21, 1995, and the Kingpin Act signed into law on December 3, 1999.
The Kingpin Act was signed into law with the intent to provide additional legal authority for the identification and imposition of sanctions, on a worldwide basis, against Significant Foreign Narcotics Traffickers (SFNTs), their criminal organizations, and the foreign persons who provide support or assistance to those traffickers and their organizations. This Act includes provisions to impose sanctions and penalties similar to the sanctions and penalties contained in the IEEPA program.
As with the IEEPA process, DEA is the focal point for the collection and analysis of intelligence on all potential SFNTs from various agencies under the Departments of Justice, Treasury, Defense, and State, including the Executive Office of the President. The leads provided to the Treasury Department's Office of Foreign Assets Control (OFAC) create a framework for the development of open source confirmations of the traffickers' commercial holdings. This combined intelligence gathering effort culminates in recommendations of potential targets to the President, enabling him to prepare a report detailing his intent to impose sanctions against the targets. As you are aware, the first such report under the Kingpin Act was submitted by President Clinton to Congress on June 1st of this year.
The process utilized to designate the foreign persons as Kingpin targets afforded all participating agencies the opportunity to recommend potential targets under the program. Priority was given to the most significant traffickers, who had committed narcotics related offenses against the United States.
DEA Headquarters elements consulted with DEA field offices, both domestic and foreign, to develop the proposed list of potential targets. These were then vetted through DEA Headquarters operations and intelligence division elements for concurrence. Three primary criteria, which were the mutual consensus of all participating agencies, were used to determine DEA's potential targets: (1) An open indictment (as opposed to one that is under seal) against the individual substantiating that he or she had violated U.S. laws by trafficking narcotics into the United States; (2) Substantial, credible open source evidence that the target owned or controlled business entities; and (3) The necessity to rely exclusively on open source documentation in the preparation of evidentiary packages. An active investigation against a trafficker did not preclude DEA from designating an individual as a target under the Kingpin Act. In each instance, however, in-depth consideration was given to the impact on active investigations, extradition proceedings, and forfeiture efforts prior to selecting a trafficker as a potential Kingpin target.
All participating agencies concurred with the proposed list of targets. The respective agencies were then tasked to review their respective data bases and conduct file research to develop additional business leads and identify criminal associates and family members of the proposed targets.
A data base was developed and maintained by the DEA Financial Intelligence Unit to track the business leads. As the leads were developed, they were passed to OFAC to determine if open source information could be obtained. By the end of March 2000, draft evidentiary packages were prepared for the proposed list of potential targets. Subsequently, the appropriate officials in DEA, Department of Justice (DOJ) Civil and Criminal Divisions, and OFAC reviewed each draft evidentiary package. The proposed list of potential targets, along with their respective evidentiary packages, were ultimately reviewed by designated Cabinet members prior to submitting them to the President for his consideration.
As stated previously, it was the mutual consensus of all participating agencies that the evidentiary packages consist only of open source information in order to protect against the release of sensitive information, sources and methods, and to ensure the integrity of active investigations. While classified information can be very useful in supporting an investigation, it must be well protected in any court proceedings from disclosure. Although the evidentiary packages consist only of open source information, DEA relies heavily on law enforcement and unclassified sources when justifying the selection of Kingpin targets.
The selection criteria as agreed upon by all participating agencies, such as the required indictment and business entities, were adhered to during the selection process. While DEA takes no formal steps to identify any U.S. persons that may be injured by a designation, every effort was made to promptly pass to the DOJ and OFAC all information that indicated possible business transactions of U.S. citizens and/or businesses with the potential targets.
DEA's involvement under the Kingpin Act since its passage in December 1999 has so far resulted in the nomination of 12 targets. However, this achievement was only accomplished as a result of time-intensive research and a drain on limited resources.
The first iteration of the Kingpin process tested DEA's financial investigative and intelligence resources. The DEA Financial Intelligence Unit consists of five (5) Intelligence Analysts who have responsibilities for worldwide support to DEA investigative and strategic financial missions. Additionally, this unit has the responsibility to provide the necessary support to conduct the thorough and time-intensive research in order to select appropriate Kingpin and IEEPA targets. This research includes, but is not limited to, investigative files and commercial data bases. In order to offset the burden placed upon DEA's human resources, five (5) OFAC analysts were detailed to DEA to assist in the research. Had the OFAC employees not been detailed to DEA, the deadline would have been very difficult to meet.
I thank you for providing me the opportunity to address the Commission, and I look forward to taking any questions you may have on these important issues.