Friday, August 27, 2010

Mexico Proposes Tougher Limits On Cash Transactions

In an effort to curb money laundering, President Felipe Calderon is proposing tough new laws that prohibit cash transactions for items exceding $100,000 MXN (equivalent $7,700 USD). 

It is not uncommon for drug lords to spend large amounts of cash when purchasing homes, cars, and other luxury items.  In fact, around 75% of transactions in Mexico are cash transactions.

One possible problem seen is that the limit on dollar and cash transactions will hurt legitimate businesses, especially near the border where transactions are conducted in both currencies. 

The Association of Bankers in Mexico has also proposed a "black list" of suspected criminals that will allow them to verify identities before opening up a bank accounts.  While this seems like a great idea, how will they account for the fact that many criminals use several aliases (and have "official ID" to back it up)???

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