Leach Sets Hearing on Foreign Gangs' Efforts to Crack World Banking

House Banking Committee Chairman Jim Leach will hold a Feb. 28 hearing on efforts by organized crime to infiltrate the international banking system.

"There is strong evidence that organized criminal gangs in Russia, the Mideast, and Africa are actively engaged in money laundering, counterfeiting of U.S. currency, counterfeiting of financial documen'ts, and financial extortion in a massive way," he said.

International crime is getting increased scrutiny from Congress. In January, hearings on the subject were held by the House International Relations Committee, as well as by the judiciary panel's crime subcommittee.

Rep. Leach may introduce legislation tightening criminal statutes for international banking crimes, according to a committee spokesman.

The Iowa Republican announced the Feb. 28 hearing along with four other hearings as part of his "Vision for the Future." This continues to include legislation that stalled last year, including Glass-Steagall reform, regulatory relief, and the thrift fund bailout.

Banking regulators are to testify before the banking panel March 13 on the evolution of bank exams. The agencies have been broadening the scope of their supervision by examining banks' exposure to much more than credit risk. New hazards being measured include interest rate and liquidity risk.

On March 27, Rep. Leach plans to take up one of the first bills he introduced as banking committee chairman: a plan to consolidate the federal banking regulators. That bill would create an independent federal agency to replace the Office of the Comptroller of the Currency and the Office of Thrift Supervision.

The committee will explore recent developments in electronic banking March 6, with a focus on the use of electronic funds transfer to distribute welfare payments, food stamps, and other government benefits.

"Electronic benefits transfer is going to be a major emerging issue," said Paul A. Schosberg, president of America's Community Bankers. "Congress and regulators have to get in on this early."

Banks and thrifts want to make sure they aren't at a disadvantage to lower-cost competitors. "The backdrop for this issue is access to the payment system," Mr. Schosberg said.

Rep. Leach said he also wants to examine the economic impact of Hong Kong's reincorporation into the People's Republic of China in 1997. Hearings March 20 will examine the economic and banking policies of Hong Kong, China, and Taiwan.

Congress is to return from a recess Feb. 26.

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