MEXICAN SENATE AGREES ON ASSET FORFEITURE LAW

C O N F I D E N T I A L SECTION 01 OF 02 MEXICO 000982 SENSITIVE SIPDIS E.O. 12958: DECL: 12/21/2017 TAGS: PGOV PREL PINR MX SUBJECT: MEXICAN SENATE AGREES ON ASSET FORFEITURE LAW Classified By: Political Minister Counselor Charles V. Barclay. Reason: 1.4 (b),(d). ¶1. (C) Summary. The Senate plenary unanimously approved on Thursday the asset forfeiture law, known in Mexico as "extincion de dominio," which has been languishing in Congress since it was proposed early last session. The bill is intended to enhance the government's ability to target the finances of organized crime groups where it hurts and will allow authorities to initiate asset forfeiture proceedings before securing a criminal conviction. The sudden passage by the Senate surprised most observers, used by now to a Congress increasingly deadlocked in the advent of mid-term elections. The legislation is an important new tool for the GOM in its fight against organized crime. With less than a month left in the session, Congress may be hard-pressed to pass other significant items of still pending security legislation, but the approval of the asset forfeiture law suggests that both parties are still willing to come to terms on important security issues. End Summary. Senate Fisticuffs End in the Bill's Approval -------------- ¶2. (C) The Senate plenary unanimously approved on Thursday the asset forfeiture law, known in Mexico as "extincion de dominio," which has been languishing in Congress since it was proposed early last session. It will now go to the Chamber of Deputies for a vote, where debate is likely to be less contentious since parties almost certainly have already ironed out major disagreements in the Senate. Most analysts predict that it will face little opposition from the lower house, but even short delays could compromise the bill's passage this session as Congress will adjourn April 30 and will reopen with an entirely new Chamber in September. Chamber leadership has said that deputies will carefully review the Senate draft, and PRI Chamber President Cesar Duarte has said they will particularly focus on protections for third party property owners who unknowingly have benefited from organized criminal activities, such as a landlord who unwittingly rented an apartment to a drug trafficker. ¶3. (C) The bill is intended to enhance the government's ability to hit organized crime groups where it hurts -- their wallets. It will allow authorities to initiate asset forfeiture proceedings in order to seize property from suspected drug traffickers and other criminals before securing a criminal conviction. This provision should significantly expedite the seizure process, since under existing laws, suspects must first be tried and convicted before their property can be seized. Property bought with income from or used in connection with organized crime, kidnapping, drug trafficking, vehicle theft, or human trafficking is eligible for seizure under the new law, and proceeds from the confiscated goods will be used to recover government costs and compensate the victims of organized criminal acts. Third party holders of illicitly gotten goods can also be subject to the seizure process to prevent organized criminal groups from hiding assets in the names of friends or family members. Related to the law, the Senate approved at the last minute a proposal by PAN Senator Santiago Creel to modify the Law of the Amparo, or legal injunction mechanism, that will prevent asset forfeiture proceedings from being unnecessarily suspended or prolonged by defendants in the midst of the process. ¶4. (C) Local political and security experts Jorge Chabat and Juan Pardinas have expressed their surprise that Senate passed the law as quickly as it did given the progressively tenser political climate in the run-up to the July legislative elections. The asset forfeiture proposal has become emblematic of Congress' relatively fitful work on outstanding security legislation and the increasingly rancorous relationship between the PAN and the PRI. The bill has been the subject of heated debate for months, and PAN and opposition Senators literally almost came to blows due to disagreements over several articles in the plenary session on Thursday. PRI Senators accused the PAN of holding up approval of the bill for its own political purposes -- namely to blame the PRI for the delay -- and the PAN charged the PRI of having obstructionist tendencies. MEXICO 00000982 002 OF 002 ¶5. (C) Indeed, the PRI does appear to be at least partly responsible for delaying passage of the legislation early this session, and both party politicking and legitimate substantive grievances may be to blame. PRD Senator and a key drafter of the asset forfeiture text Tomas Torres told Poloff in March that the PRI's call for further discussion on the legislation was a move purely designed to punish the PAN for German Martinez's volley of rhetorical attacks against the party. Other analysts have contended that the bill was flawed, lacking protection for innocent third party property holders and too easily used by petty bureaucrats for political or personal retribution, that the PRI was correct in identifying. New safeguards were included, such as allowing only high-level federal prosecutors to initiate such proceedings, which in theory should increase official accountability and better shield innocent parties. Comment -------------- ¶6. (C) The asset forfeiture law is an important new tool for the GOM in its fight against organized crime. As Jorge Chabat noted, the drug war will be a long fight, but this legislation locks in an important new weapon. Colombian diplomats have emphasized to POLOFF that its own property seizure law was key to its success in combating drug trafficking in its own country, and have long sought to help Mexico draft a similar law. With less than a month left in the session, Congress may be hard-pressed to pass other significant items of still pending security legislation, especially given the acrimonious new political environment. Nevertheless, the approval of the asset forfeiture law suggests that both parties are, at the end of the day, still willing to come to terms on important security issues...particularly when their reputations are at stake. 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