ney General, the White House, the Office of Management and Budget staff and GÁO. We think voice privacy is essential, not only for the safety of our agents, the safety of the public, but also the protection of the integrity of the case.

Mr. KINDNESS. I certainly wouldn't question that. I was not aware there had been a system developed that was not subject to being overcome by other electronic means. But there is something?

Mr. BENSINGER. I represent to you and the members of the committee that the program we are proposing is not hypothetical. It's real. We are having field tests done. And it is of a nature that we do not in real time terms think the trafficking organization-as sophisticated as they can be can hear, translate, and interpret the communications affected.

We have a system-we actually have a daily change of codes in our transmissions. Even if an apparatus were stolen or acquired in a typical shootout, we'd still have the capacity to change that transmission within the next several minutes.

Mr. KINDNESS. Thank you.

Mr. DRINAN. The gentleman from California, Mr. Lungren?
Mr. LUNGREN. Thank you.

Mr. Bensinger, in going through your statement, I take it you don't support the effort to bring within the Federal purview robbery of pharmacies where the intent is to steal narcotics?

I am supportive of that position, but my question is: Are there areas where you believe you need increased legislative response to assist you in your department?

Mr. BENSINGER. Yes.

We have submitted to the Department of Justice and I have discussed with Chairman Drinan some potential revisions to the Controlled Substances Act that would provide us with an opportunity to close some loopholes that presently exist, increasing penalties, providing I think increased opportunities for diversion investigation units that we have done before, particularly in the retail practitioner pharmacy and physician area, to provide greater assistance to States and local law enforcement in that particular area.

From the standpoint of legislative initiative, the initiatives that the committee has already undertaken to increase the marihuana penalties are absolutely on target.

And I don't want to repeat myself on bail and on other issues, such as the paraquat in the Foreign Assistance Act. But the more we can do to stop the drug at the source, the far more economical, effective, and health protective we will be in our own population.

Mr. DRINAN. Would the gentleman yield for a moment?

Mr. LUNGREN. Yes, sir.

Mr. DRINAN. How much would it cost to have the DIU's [sic] expanded so that they are effective in every large metropolitan area? You need not supply this now, but if you could supply it for the record, I think it would be very helpful. Your testimony is that they are very effective, even more effective as I understand it than would be the extension of Federal jurisdiction to the robbery of local pharmacies. And that information would be very, very helpful to the subcommittee.

I thank the gentleman for yielding.

Mr. BENSINGER. Chairman Drinan, you are absolutely right. I think the pharmacy theft programs we have in 18 cities expanded to a much larger basis would do far more to reduce the number of pharmacy thefts than assigning a jurisdictional responsibility which we really couldn't perform.

And we will provide that additional information.

Mr. DRINAN. You will supply the estimate prior to the time that the full Judiciary Committee passes on the authorization? Then I would make every effort, if it is a reasonable figure, to get it in the program for this year.

Mr. BENSINGER. We will provide to you both an assessment as well as a cost estimate.

Mr. DRINAN. Thank you very much.

Mr. LUNGREN. Sir, you have referred a couple of times to the fact that you are aware of the subcommittee's action increasing the penalty for marihuana trafficking; and I think we have pretty close to unanimity on that in the subcommittee.

At the same time we also have voted for reduction in penalty for possession of marihuana offenses; and although it apparently would have no actual effect on the prosecutive or investigative forces of DEA or DOJ, do you think there is a potential problem in that it might give a signal that somehow we are approving the use of marihuana? Mr. BENSINGER. Possibly, although it is still retained as a criminal infraction in the law. As you correctly report that it does not have an impact on investigations, because we are not operating at that level in the first place.

I think it's how it's presented, and how the Congress, the administration, the Surgeon General, particularly, represents marihuana.

I see increasingly clear evidence that it is clearly harmful. There isn't a debate as to whether it is a drug that is good or couldn't or shouldn't be used by the general public and in particular by adolescents.

But I don't see an effort on the part of the administration to make such a representation. I see the contrary. I see the White House developing films for parents only; I see the Director of the National Institute of Drug Abuse talking about the health hazards of marihuana.

I think it's just a question as to the interpretation in the eye of the beholder.

Mr. LUNGREN. Thank you. The concern I have in the area of marihuana is what seems to be its proliferating influence throughout the school systems, as low as grammar schools.

Mr. BENSINGER. I think you are right.

Mr. LUNGREN. And if that drug culture extends to that degree. I think we will see some major problems in the future that may make what problems we have today look small.

One of the things I have particular concern about is the use of PCP. I offered an amendment in the subcommittee which was adopted to upgrade the penalties with respect to PCP; due to the fact that in southern California it's become a major problem.

Some other members had questions as to whether PCP was a problem nationwide, or whether it just happened to be in California-a State which in some cases sets trends for good or for ill.

Could you comment on what the Department sees as the present problem of PCP, the growth of it as a drug, and the potential problem it presents?

Mr. BENSINGER. I think I can, sir.

You are correct in the sense that the western part of the United States has had the majority of the more spectacular feats.

In 1977, there were 67 lab seizures of PCP. In 1978 there were 79. In 1979, after the PCP penalty increase, as well as the lead in the precursors, we saw a 35.4-percent decrease in the number of labs, down to 51.

We see a leveling off nationally of PCP abuse. This is because Congress responded immediately to this threat. It did an outstanding job, talking about "angel dust, angel death," because law enforcement was able to come up to you and say, "We need two things, these precursors are available and we'd like to have them scheduled as analogs; and we'd like to double the penalty for PCP traffickers."

Now, the lab seizures, Mr. Lungren-the PCP are in orange up here [indicating chart]. In San Diego Valley, we had one with 28 pounds of PCP, and 700 pounds of precursor shipped all the way from Rochester, N.Y. Steve Austin, the agent who made that case was given a Distinguished Service Award by DOJ. He was 1 year out of basic agent's school. Other labs: Seattle, Oregon, western Pennsylvania [indicating], Michigan, Fairfax County, Montgomery County [indicating]-heavy PCP-Texas [indicating].

It has varied by region. In the Northeast we've had only 5 labs, Southeast 13, north central 13, south central 8, and the western area 12, but almost all of them in the State of California.

Mr. LUNGREN. It does not appear to be essentially a California problem.

Mr. BENSINGER. It isn't but California has been an area with a great deal of the raw material manufacturing taking place.

Mr. LUNGREN. This may be a very general question. I sit on the Subcommittee on Immigration. Every year, unfortunately, I think I get a little more depressed realizing perhaps we have a problem we really can't deal with the question of illegal aliens.

I would like to have a general statement from you regarding controlling abuse of drugs. Do you think we are making a dent? Do you think we are really doing something effective overall when you take into consideration the almost overwhelming amount of the problem that you are dealing with here?

You tell us you've managed to do a pretty good job in stopping drugs from coming from Mexico, and all of a sudden it's like something popped up somewhere else-from Southeast Asia; you do a good job there and now instead of oil we get drugs from Iran.

Are we making some progress? Is it significant progress? Or is it just going to continue to be a holding action? What's the status?

Mr. BENSINGER. There can be no question of the progress that has been made in the control of the principal drugs of abuse identified by this and previous administrations.

There is a decrease in availability, that is clear and unquestioned, and it has continued over a number of years.

It has been made despite the odds that favor the trafficking organizations, the money and the influence, and despite the fact that it

is not a problem-you are right-that is solely within our borders. We have to work with the foreign countries.

But, I think, the United States has proven that by working with Mexico and foreign governments to reduce availability of heroin, that it has had considerable success.

I think the GAO report will recognize that and recognize the gains made.

In barbiturate abuse we've seen a 23-percent decrease in the injuries and fatalities related to that through closer quota control.

I think the Government is also in the midst of turning the investigative system of traditional drug cases from just making drug seizures and arresting people to seizure and forfeiting assets. We have now over $400 million of assets under investigation as a result of congressional action in one statute so that money derived from illegal narcotic transactions is subject to forfeiture with judicial review. Funds derived from and intended to be used for violations of the Controlled Substances Act are rendered to the Government and the people: the illegal moneys, the assets, buildings, properties, bank accounts that derive from the pain and suffering of the addiction of people who were sold illegal drugs.

That, plus the clearly demonstrated gain against heroin indicates to me this isn't hopeless. There has been success, and it can be continued.

I think we need, as Chairman Drinan says, a good joint effort so that Congress and the executive branch don't work at cross-purposes, or in different directions.

I am appreciative not only of the tenor of this hearing, but also of the support of Members of Congress who work in that direction. I think, in terms of injuries sustained, you've got to feel good about the fact that instead of 5,000 injuries every quarter from heroin, we are down to 2,200. In 1979 PCP injuries in emergency rooms and hospitals were at the rate of 500 a month; in December it was 221. That is significant progress on PCP-not without some pain.

Also we were able to close down the Mexican connection and there was not an automatic source to fill its place. We didn't see southeastern or southwestern Asian heroin flood in immediately; in fact, it's not flooding in today.

And for a change we are working on the problem before it becomes a crisis instead of after the fact, as was the case in the French connection and the Mexican connection.

No, I feel good about what's being done. I feel good about what our agency is doing. And I think we can stand with some confidence on our record, aware of the difficulties, the complexities of the problem we face-particularly regarding the drugs that don't have the same level of universal support for enforcement in terms of penalties or in terms of eradication, namely marihuana and cocaine.

Mr. DRINAN. Mr. Nellis?

Mr. NELLIS. Thank you, Mr. Chairman.

Mr. Bensinger, you and I have had many discussions about this problem in the past.

I first want to tell you that Dan Addario in San Francisco whom I visited-Mr. Addario is a special agent in the DEA office there I visited last week-is in the midst of one of the most incredible drug conspiracy cases I have ever encountered-with the Hell's Angels.

And after exposure to that I want to commend you and Mr. Addario for bringing these nasty individuals to trial.

Mr. Bensinger, I am very much interested-always have been—in the extent to which DEA makes good financial cases, particularly now that the problem of privacy disclosure is present.

What progress has been made by DEA in digging up the financial staff to analyze money flow to determine where the traffickers are putting their money?

Mr. BENSINGER. Considerable progress has been made and is needed to be made in this area.

We have in the Office of Enforcement a financial investigative unit. Initially, 1 year ago, this was in the Office of Intelligence and studied where money was strategically moving. We did not feel we were getting the immediate technical benefit of that team, so now it is in the Office of Enforcement.

Last week we had 55 of our most senior managers in the field, special agents in charge, regional agents in charge, and in some cases country attachés come to Washington-and these 55 individual managers went through an extensive 5-day in-depth review of the log of individual cases. Other agencies, IRS, Customs, as well as our own in-house people provided in-depth information. DEA's Chief Counsel's office provided an in-depth assessment of how to really use the law.

Those supervisors are not the only individuals getting exposed to financial investigation. We trained over 150 group supervisors and team leaders. We have insisted that we have everyone read the "same sheet of music," we don't just have our regional directors make financial cases without providing to agents in charge, group supervisors, team leaders, and the agents themselves that information.

We have extended our basic agent training period from 10 weeks to 12 weeks to guarantee that we have more time to cover conspiracy investigation and financial investigations; and we have the FBI and Customs and Treasury Department assist us in the jurisdictional reviews and responsibilities that they may have.

The committee will hear, I hope, from the administration that there should be attention to the financial right of privacy in tax reform. In DOJ-Irv Nathan, who is the Deputy Assistant Attorney General, Criminal Division, and Phil Heymann, have taken a position with respect to the present status of the law and IRS' interpretation.

They will represent the Department in testimony which has been submitted to the Senate Permanent Subcommittee on Government Operations. We hope this gets clarified both from the standpoint of Department of Treasury, as well as Department of Justice.

But we are training our agents, training our supervisors, enlisting teams with other agencies to go after the money.

And the amount of money that is being seized on a daily basis today is in the hundreds of thousands of dollars.

Mr. NELLIS. Are you aware whether or not there has been any change in customs declarations regarding the $5,000 declaration disclosure and the $10,000 disclosure? As I remember, if I don't know the regulation exists, I don't have to fill out the form. On that basis, as you may recall, much of the money, ill-gotten gains, was moved out of the