US embassy cable - 05SANSALVADOR2357

C O N F I D E N T I A L SAN SALVADOR 002357 
 
SIPDIS 
 
STATE FOR INL 
 
E.O. 12958: DECL: 10 YEARS 
TAGS: EFIN, SNAR, KCRM, KJUS, ES 
SUBJECT: WIRE TRANSFER COMPANIES USED IN MONEY LAUNDERING 
SCHEME 
 
Classified By: DCM MICHAEL BUTLER FOR REASONS 1.4(b) & (d) 
 
1. (U) On August 17, 2005, the Salvadoran police (PNC) 
arrested Panamanian national Luis Pinto for allegedly 
laundering US$75,000 a day through Salvadoran wire transfer 
companies since March of 2004.  Participants in the scheme, 
using false identities, wired money from the United States to 
fictitious persons in El Salvador.  Employees of a wire 
transfer company in El Salvador collected the funds and 
delivered them to Pinto.  Pinto then wired the money to 
different bank accounts around the globe. 
 
2. (C) Pinto's arrest would have been impressive if the GOES 
had broken the case.  Instead, all evidence and information 
was provided to Salvadoran officials by Post DEA.  GOES 
officials suggested in the press that El Salvador's money 
laundering law is not broad enough to ensnare launders who 
use wire transfer services.  Post agencies disagree. 
Salvadoran officials have not/not been uncooperative relative 
to money laundering investigations.  At the same time, they 
have failed to demonstrate the requisite initiative and 
determination to successfully uncover money laundering 
schemes.  With only a handful of money laundering 
convictions, all of which were additional charges attached to 
drug traffickers, it remains to be seen whether the GOES will 
realize a conviction on the singular charge of money 
laundering. 
 
3. (SBU) COMMENT:  Post is not aware of any study or evidence 
that indicates the level of money laundering in El Salvador. 
We do know, however, that one-quarter of the population of El 
Salvador lives in the United States, and that Salvadorans 
living abroad have sent US$1.6 billion in remittances to El 
Salvador during the first seven months of 2005.  Reason 
suggests that the money laundering scheme highlighted above 
is neither singular nor unprecedented.  Thus far in 2005, 
however, the GOES is managing only two money laundering 
investigations (excluding the current case).  No money 
laundering convictions have been realized.  Post will 
continue to work with the U.S. Treasury Department's Office 
of Technical Assistance to further Salvador's efforts against 
money laundering. 
Barclay