US Faces Tough Fight in Cash Smuggling Crackdown Jeanette Barraza-Galindo conspicuously left her bags of teddy bears and throw pillows on a bus during an inspection at the Texas-Mexico border - and professed ignorance about the $277,556 officers found hidden inside. The bags were handed to her at a bus station, gifts to be given to a child upon her return to Mexico, she told investigators. The crime she pleaded guilty to - bulk cash smuggling - is increasingly drawing the attention and resources of federal authorities responsible for fighting drug trafficking across the border. Federal immigration agents say their investigations have yielded more cash seizures and arrests in the past half-dozen years as criminals, sidestepping scrutiny from banks over electronic transfers, resort to using cash to conceal proceeds from drug trafficking as they move the money south to crime rings in Mexico and elsewhere. It's similar to the tactic taken in fighting terrorism: crippling financing networks before the money ends up with leaders of drug cartels and trafficking rings. But the flow is hard to stop. Officials in the U.S. and Mexico are realizing that criminal enterprises, just like other businesses, can't operate without a steady cash stream, said David Shirk, director of the Trans-Border Institute at the University of San Diego, which promotes scholarship of border issues. This undated photo, provided by U.S. Immigrations and Customs Enforcement (ICE), shows bulk cash seized during a combined ICE and Homeland Security Investigation (HSI) operation. Immigration agents report a rising number of cash seizures and arrests in the past half-dozen years as criminals, sidestepping scrutiny from banks over electronic transfers, resort to using cash to conceal proceeds from drug trafficking as they move the money south to crime rings in Mexico and elsewhere. (AP Photo/ICE) Close "We're shifting our strategy to a more diverse strategy of not just going after bad guys and arresting them, but also going after their guns, going after their money," he said. It's illegal to try to smuggle more than $10,000 in undeclared cash across the border. Officials say the crime itself is often connected to other illegal activities including drug trafficking, gambling, and credit card and customs fraud. Money that's seized is deposited into government forfeiture funds, which can be used for further law enforcement efforts. The Obama administration has identified targeting bulk cash smuggling as a prong of its strategy against transnational crime. Congressional panels held hearings on the issue last year. U.S. Immigration and Customs Enforcement reported more than $150 million in seized cash and 428 arrests in bulk cash smuggling investigations in fiscal year 2011, up from $7.3 million and 48 in fiscal year 2005. A cash smuggling center in Vermont that's run by ICE's homeland security investigations and that opened in 2009 has expanded operations in a sign of heightened emphasis, officials announced in December. But experts say measuring the impact of the beefed-up focus is tricky. It's hard to track cash's origin and destination - and investigators can't always count on help from couriers, who may be more afraid of cooperating than spending a few years in prison. Plus, the amount seized represents a fraction of the total money at stake. Estimates cited by federal authorities suggest at least $18 billion in illicit proceeds is smuggled across the southwestern border each year. A 2010 report by the Government Accountability Office said staffing and infrastructure at the border were limiting success in detecting large quantities of cash, and also highlighted another problem: the use of prepaid, stored value cards - which may be used to access cash at ATMs and aren't as stringently regulated as traditional banking.