Legislators put some starch in a bill aimed at preventing money laundering when they voted yesterday to impose stiff penalties on persons convicted of trying to pass large amounts of currency through banks without the government's knowledge.

The objective is to attack the drug trade by making it harder for smugglers and dealers to spend their profits. "Without access to the nation's financial system, organized crime is stymied in its efforts to launder funds and hide their origin," said Fernand J. St Germain (D-R.I.), chairman of the House subcommittee on financial institutions.

Money laundering from all sources -- narcotics, illegal gambling and other illegal activities -- is estimated to involve tens of billions of dollars annually.

The Comprehensive Money Laundering Prevention Act, passed by the subcommittee on a voice vote, for the first time would allow prosecution of people known in the drug trade as "smurfs." Because federal law requires reporting of cash bank transactions of $10,000 or more, "smurfs" break large drug cash payments into smaller units.

The money laundering act would impose criminal and civil liabilities on these people, including seizure and forfeiture of cash and property. It would permit the treasury secretary to lower the $10,000 limit to $3,000 in a specific area.

The law governing changes in control of banks would be reinforced to require a full investigation of the background of people seeking to buy banks. "In addition to stopping crime figures from laundering funds at the teller's window, we must make certain this element cannot come in through the back door as owners of these institutions," St Germain said.

The measure passed easily with few amendments. One effort by Bill McCollum (R-Fla.) to give banks protection from civil liability, to encourage them to volunteer information about financial activities, was defeated. Another, proposed by George C. Wortley (R-N.Y.) to exempt foreign subsidiaries of banks from the bill, was withdrawn when several representatives argued it would create havens abroad for money laundering.

Another antilaundering bill was reported out of a House Judiciary subcommittee this week.

The St Germain bill is a reworking of the Bank Secrecy Act of 1970, which first imposed currency reporting requirements on banks. For many years banks ignored it, and bank regulators were "callous to the point of total indifference" in enforcing the law, St Germain said.

Pressure on money launderers began to increase last year when the Bank of Boston was charged with failing to report $1.3 billion in cash transfers from Swiss banks. The bank pleaded guilty and was fined $500,000. Since then, other major financial institutions have faced similar charges.

An official of the Bank of America and five other people were charged with laundering $36 million in drug money in March. Three months earlier that same bank paid a record $4.75 million fine to the Treasury for failure to report large cash transactions.

Crocker National Bank was fined $2.25 million for the offense. And just last month, Shearson Lehman Brothers Inc. was indicted on charges of laundering $1.2 million. Approximately 65 bank holding companies or banks are under investigation for possible violations, St Germain said. And 14 banks have paid fines ranging from $120,000 to $5 million.

He acknowledged yesterday that the banks recently have "got religion" and that scores of them have approached the Treasury Department to work out agreements on similar violations. Nevertheless, recent court decisions have left in doubt whether people, as well as banks, must report large cash transactions. The bill passed yesterday by the subcommittee would make it clear that people also must report.