<a href=www.nynewsday.com>NY NewsDay By Anthony M. DeStefano Staff Writer

March 31, 2003, 6:09 PM EST Federal investigators said Monday they broke up a ring of U.S. and Israeli nationals suspected of laundering millions of dollars in proceeds from trafficking in the drug Ecstasy.

A total of 17 people, as well as one Florida company, face charges in the probe, which involved coordination between federal and Israeli law enforcement agencies in the last year.

Among those arrested was Natan Banda, the alleged ringleader of the money-laundering network, which federal agents believe has systematically handled tens of millions of dollars in narcotics proceeds. Banda has U.S. and Israeli citizenship and maintains homes in Williamsburg and upstate Monroe, according to the affidavit for the arrest warrant unsealed Monday.

Others charged include the brothers Zakay and Ezra Sasson, identified in the affidavit as being residents of Florida and citizens of the United States, Venezuela and Israel. The Sasson brothers are listed as officers of National Electronics, Inc., a Florida company that sells consumer electronics in Central and South America, according to the affidavit. Federal investigators allege that the Sasson brothers arranged to launder millions of dollars for Banda.

The arrest warrant affidavits said there were alleged telephone conversations and money shipments totaling millions of dollars between Europe, Los Angeles and New York.

Arraignments were under way late Monday and bail packages were still being worked out with relatives and friends of some of the defendants.

Reuters, 03.31.03, 5:01 PM ET BOGOTA, Colombia, March 31 (Reuters) - The Colombian government will ask a local court whether state-owned Ecopetrol should renegotiate a contract with U.S. firm ChevronTexacoCorp. (nyse: CVX - news - people) to develop the offshore Catalinas natural gas field at a cost of $150 million, officials said on Monday. The State Council, a court that arbitrates contractual disputes between the government and the private sector, will determine whether the current terms of the Catalinas contract mean the government would forfeit potential royalties, Comptroller General Antonio Hernandez told reporters. If so, then Ecopetrol would renegotiate the contract, said Hernandez, the chief auditor of government spending, speaking after a meeting with President Alvaro Uribe. The auditor argues that if the project is, in effect, an extension of two fields already operated by a ChevronTexaco subsidiary then the state would receive $100 million less in royalties. Under Colombian law, if the court decides that Catalinas is just an offshoot of the existing operation according to the current contract, then royalties would be only 7 percent of production, compared with 20 percent if the project is totally new. "We have decided in this meeting that the national government will consult the State Council," Hernandez said. "It shouldn't take a long time, I estimate it will be two or three months," he said, adding, "Depending on its ruling, we will continue or renegotiate the contract." Ecopetrol signed the Catalina contract with Texas Petroleum Co., a ChevronTexaco subsidiary, on Feb. 8 but the controversy has slowed development of the project, which would cost $150 million. Catalinas, off the coast of the northeastern Colombian province of La Guajira near Venezuela, would ensure the natural gas supply to much of central Colombia for decades, with some left over to export to Venezuela. Texaco already operates the offshore Chuchupa field in La Guajira, and the onshore Ballenas field, producing a total of 500 million cubic feet a day, with which it supplies much of the gas needs of the country's capital, Bogota. Total proven reserves at the fields are estimated by Ecopetrol at 2,266 billion cubic feet. ChevronTexaco has not commented here on the dispute.

Dow Jones Tuesday April 1, 5:27 AM

CARACAS (Dow Jones)--A shipment of 360,000 barrels of unleaded gasoline destined for the U.S. is expected to leave Venezuela's Paraguana peninsula Wednesday, a refinery manager of state-owned oil monopoly Petroleos de Venezuela SA (E.PVZ) said Monday.

"The Nicos tanker has just docked, we can now start loading the cargo," plant manager Humberto Reyes said. The shipment should leave Wednesday, Reyes added. It would be the first gasoline shipment destined for export from the 940,000 barrels per day (b/d) Paraguana refinery complex since a strike hit PdVSA from December 2002 until February 2003.

The stoppage curtailed exports of crude and refined products. Only in the last several weeks have production and refining operations increased. President Hugo Chavez said Sunday refining runs stand at more than one million b/d. Total domestic refining capacity stands around 1.3 million b/d.

Reyes further added that the plant is currently restarting its coking unit. "We expect the entire complex to run at normal capacity between April 20 and April 22," Reyes said.

About 35,000 employees walked off their jobs in early December, crippling oil production and exports. Production is estimated at somewhere between 2.4 million and 2.8 million barrels per day by secondary sources, while oil exports are seen slightly above 2 million b/d. Venezuela's pre-strike production level was 3 million b/d.

By Fred Pals, Dow Jones Newswires; 58212-5641339; fred.pals@dowjones.com;

<a href=www.upi.com>By Bradley Brooks, UPI Business Correspondent From the Business & Economics Desk Published 3/31/2003 4:41 PM

RIO DE JANEIRO, Brazil, March 31 (UPI) -- Brazil's central bank on Monday cut its forecast for economic growth and raised its prediction of inflation for 2003, a sign that hikes in the key interest rate might be in store.

Brazilian officials and analysts blamed the impact that the war in Iraq is having on the global economy, specifically oil prices and emerging-market investors' appetite for pumping cash into Latin America during a time of turbulence.

The developments come at a pivotal moment for Brazil, the region's largest economy, just as a new president is gaining the trust of investors with economic austerity.

Its neighbors are looking to Brazil to be the engine that pulls South America out of an economic slump, as Argentina languishes and Venezuela remains mired in internal disputes.

In its quarterly report, the central bank said Monday inflation could hit 10.8 percent this year, up from earlier forecasts of 9.5 percent. The official inflation target, however, remains 8.5 percent.

As for economic growth, the bank has now revised that down to 2.2 percent for 2003. Earlier, bank officials forecast growth at 2.8 percent.

The likely outcome, analysts say, is that the benchmark interest rate -- now 26.5 percent -- might be hiked to battle inflation.

Since last October, the central bank has raised interest rates five times. The campaign and ultimately the election of leftist President Luiz Inacio Lula da Silva sent the local currency into a 35-percent plunge, sparking inflation.

Lula and his economics team have repeatedly said their top goal is to keep inflation at bay, though it is clear they are eager to cut rates, which they see as stifling economic growth.

This, in turn, ratchets up the political pressure on Lula, who was swept into office on sweeping promises to change the social situation in Brazil, where divisions between rich and poor are among the world's widest.

Lula desperately needs growth to pay for his social programs. If he can't make good on those promised programs, analysts say his political base will slip out from under him.

"Government popularity will take another hit," said Marcelo Ribeiro, an analyst with the Pentagono brokerage firm in Rio de Janeiro.

"This is worrisome because government popularity is already deteriorating, according to the polls. And they have enormous challenges ahead -- like fiscal and social security reforms, when all the support will be needed."

This conflict between campaign promises and economic realities reared its head Monday, as Lula announced an increase in the monthly minimum wage from $60 to $72 a month. While still low by Western standards, the minimum wage is used as a base for many other upper-tier private- and public-sector salaries.

Economists fear that the pay hike might have the short-term effect of fanning inflation as consumer demand increases. That would increase investors' wariness of Brazil, compounding a delicate economic situation and potentially leading to a self-fulfilling debt default.

This is much less of a concern now than last October, but analysts are watching the situation closely.

The central bank said its revisions were largely a reflection of continued global uncertainty stemming from the war.

Most immediately, higher world oil prices hit Brazil, and other Latin American nations, hard. Such hikes quickly spark inflation in countries that are highly vulnerable to oil price fluctuations.

For Latin America -- still trying to regain foreign investors' trust after Argentina's disastrous default in 2001 -- anything that worries these investors bodes ill for economies that are just now recovering.

Ribeiro, who closely tracks Brazil's essential oil and aviation sectors, said he is more concerned about the central bank's lower growth forecast than about higher inflation.

"These sectors are already plagued by overcapacity in Brazil, and all over the world," Ribeiro said. "A lower GDP growth means more unemployment and less public support."

Since taking office on Jan. 1, Lula and his team have gone a long way in easing investor concerns. The central bank quickly hiked interest rates after Lula's inauguration, and fiscal austerity has been the rule.

Under normal conditions, analysts say, this would mean brighter prospects for Brazil, as it begins emerging from a tough 2002 that saw its markets plummet and foreign credit lines snap.

For instance, after months of finding it impossible to raise funds abroad, Brazilian corporations announced in the past few weeks that they've raised upwards of $2 billion in fresh foreign capital.

But Ribeiro and other analysts fear that should the Iraq war drag on, sentiment could sour against just as quickly, sending Brazil's economy back toward the brink of collapse.

NEWSDESK 31 Mar 2003 21:01:11 GMT

BOGOTA, Colombia, March 31 (Reuters) - Sixteen Colombian journalists working in a region where U.S. special forces are providing anti-guerrilla training said they were fleeing to the capital Bogota on Monday after receiving death threats from gunmen, a media rights group and colleagues said.

Paris-based Reporters Without Borders (RSF) said leftist rebels and right-wing militias fighting in Colombia's four-decade-old war had separately declared the journalists in the eastern, oil-rich province of Arauca "military targets" and warned them they should leave or face being killed.

Rodrigo Avila, a correspondent for Caracol TV and one of the journalists threatened, said local radio stations in Arauca were only playing music and airing cultural programs.

"The rebels' idea is to silence the press in the capital of Arauca and unfortunately they are achieving it. We are forced to shut up and find a solution," Avila told reporters.

The Revolutionary Armed Forces of Colombia, known as the FARC, produced a list of eight journalists, while the right wing paramilitaries, known as the AUC, threatened another eight, and also named two who had previously been killed.

One of the men named, Eduardo Alfonso, was gunned down and killed two weeks ago by suspected far-right paramilitaries as he arrived for work at an Arauca radio station. His boss, Efrain Varela, was killed last year.

War-ravaged Colombia is one of the most dangerous places in the world for reporters, according to media watch groups.

President Alvaro Uribe late last year declared Arauca, a steamy area of savannas and swamps on the border with Venezuela, a special war zone, giving security forces extra powers to control movements and check identities.

The measures, which have been strongly criticized by rights groups, have had little effect on violence in the province, which has been hit by a rebel car-bombing campaign.

About 70 U.S. special forces are in Arauca province training Colombian troops to combat guerrillas and defend a key oil pipeline.

Local police say they do not have enough bodyguards to protect the threatened journalists.

"We ask the government to guarantee the security of the journalists threatened in the province of Arauca," RSF said in a news release. "The absence of journalists is an open door for more abuses."

Journalists in Arauca routinely face harassment and threats from rebels and militias fighting for control of oil proceeds and the booming drug trade.

In January, rebels held a British reporter and an American photographer hostage for almost two weeks, in a kidnapping which drew worldwide attention. Attacks on local reporters hardly ever make international headlines.