TERRORIST FINANCE: CONSULTATIONS OF EB/TFC DEPUTY

C O N F I D E N T I A L SECTION 01 OF 03 THE HAGUE 002530

SIPDIS

STATE FOR EB/ESC/TFS, S/CT, EUR/ERA, EUR/PGI, INR/EC, IO/PHO
TREASURY FOR ZARATE
JUSTICE FOR OIA/FRIEDMAN
FBI FOR LORMEL
BRUSSELS ALSO FOR LEGATT

E.O. 12958: DECL: 09/30/2008
TAGS: ETTC PTER EFIN IZ NL EUN
SUBJECT: TERRORIST FINANCE: CONSULTATIONS OF EB/TFC DEPUTY
DIRECTOR GOFF IN THE NETHERLANDS

Classified By: DCM Daniel R. Russel Reason 1.5(b) and (d)


1. (SBU) SUMMARY: Ed Goff, Deputy Director EB/ESC/TFC, met
Sept 11-12 with Dutch officials, bankers,
and U.S. Embassy staff to share ideas in the war on terrorist
financing. These officials reiterated Dutch commitment to
furthering terrorist financing efforts both domestically and
in the EU. They said the Dutch are willing to advance the
terrorist financing agenda during their upcoming EU
presidency with Finance Ministry
officials particularly stressing the need for progress in
enacting a new EU anti-moneylaundering directive. Goff and
Embassy officials discussed the utility of an early small
informal conference of terrorist finance action officers from
selected US Embassies in Europe to set the stage for progress
during the Irish, Dutch, and UK EU presidencies. End
summary.

Meetings with Embassy Officers
-------------- --------------


2. (SBU) Emboffs related to Mr. Goff their excellent
ongoing cooperation w/ Dutch counterterrorism authorities,
especially on terrorism finance and transportation security
issues. They noted the upcoming EU presidencies of Ireland
and the Netherlands and observed that the two had agreed to
cooperate with each other in order to provide more continuity
in the Presidency. It was suggested that since the
Department has a number of objectives for the EU in the
counterterrorism finance arena, it might be appropriate for
officers responsible for the working level management of such
issues to meet in an informal setting before the New Year in
order to orient newly participating Emboffs, to brief
Department priorities, and to explore other possibilities for
action. It would be appropriate, in this context, to include
terrorist finance action officers from the Hague, Dublin,
USEU, Rome (the current EU President),and London,
additional European posts that may have issues of concern as
well as working-level representatives of Washington agencies.
Representatives from Embassies Berlin, Paris and Spain might
be included for their insight into EU controversies. In any
case it was thought that it would be appropriate to keep the
meeting small and informal enough to enable free and frank
discussions.

Finance Ministry
--------------

3. (SBU) Accompanied by Econoff Todd Kushner, on Friday,
Goff met with officials from the Integrity Division of the
Ministry of Finance: Margreet H.M. Wenting (action officer
on designation issues),Klaas Werkhorst (Division Director)
and Dr. EYC Lightart, (Deputy Division Director). These
officials highlighted their roles in ensuring Dutch financial
institutions receive designations promptly and in an easily
usable format. This process, they said, has been greatly
systemized since the days immediately after 9/11/01 and now
is largely conducted electronically. Werkhorst revealed that
the GONL is preparing legislation that would require
financial institutions upon the request of the Finance
Ministry to search their records for transactions of
individuals and entities who are not designated but are of
interest. Wenting noted the need for clear identifiers of
individuals who are designated, so that financial
institutions can review their records with greater precision.
Mr. Goff observed that practice had evolved since the
initial designations, and
that now the USG undertakes extensive efforts to ensure that
detailed identification information is provided, when
available. Wenting explained Dutch procedures for handling
situations where a financial institution uncovers accounts
held by a person or entity that matches or partly matches a
designation but cannot conclude that the account and the
designee are the same; in those situations, the name and
account information are turned over to the Dutch security
service (AIVD) which has two weeks to determine if the
account holder and the designee match. If the AIVD does not
come back with an affirmative decision, the accounts are
unfrozen.


4. (SBU) Finance officials also noted that terrorist finance
was high on the list of items the Dutch Finance Ministry
wants to tackle during the 2004 (latter half) Dutch EU
presidency. In particular, the Dutch would like to promote
enactment of a third EU money laundering directive that would
incorporate the latest FATF thinking. They were very open
and interested in exploring how U.S.-EU cooperation against
terrorist financing could be intensified in the period
leading up to and through the Dutch EU presidency.


5. (SBU) Reflecting an internal discussion of whether the
Dutch government should resume welfare payments to Jose Maria
Sison, who (although designated by the U.S. and EU is still
resident in the Netherlands),Dr. Ligthart asked about U.S.
practice on payments to individuals who have had their assets
frozen. Mr. Goff explained that it has been standard
practice to permit individuals whose
assets have been frozen limited access to resources, a
practice needed on humanitarian grounds and carried out in
accordance with UNSC Resolution 1452. Finance officials
were also interested in USG delisting procedures. They
observed that eventually courts in one country or another
will rule negatively on a listing thereby forcing a country
out of compliance with UNSC Res 1373 or 1390. Mr. Werkhorst
wondered what thought had been given to this by the USG. Mr.
Goff observed that comprehensive USG reviews of cases ensure
judicial reversals are unlikely, but acknowledged that it was
not outside the realm of possibility
that such a case could arise.

Foreign Ministry
--------------

6. (C) In a separate meeting hosted by Jaap Werner (Foreign
Ministry Political Affairs Director) that also included
representatives from MFA's European Affairs and Middle East
Departments, MFA officials indicated their ongoing attention
to driving the Dutch interagency process in the direction of
more and higher quality designations (i.e., not just
designating terrorist organizations but their supporters,
fundraisers, and front organizations) and effective law
enforcement actions against terrorist support networks in the
Netherlands. They noted that within the Dutch interagency
process and within the EU clearinghouse the ability to draw
on convincing information regarding the terrorist connections
of entities considered for designation is key to making that
happen. Werner mentioned the recent EU clearinghouse
discussions regarding possible designation on the six Hamas
leaders and 4 charity organizations noting that France had
maintained a hold on the leaders for political reasons and
that Austria, France, and the UK had reservations on the four
Hamas-linked charities on informational grounds. The Italian
presidency would request more information on the four
organizations, Werner noted, "but perhaps these countries
could find and table more information on the charities if
they wanted to."


7. (C) Werner continued that EU member states needed to
ensure they had enough information linking terrorist
organizations to individuals or entities considered for
designation to forestall any potentially successful court
challenges. He asked whether the Palestinian Authority, now
that it had taken action against the Hamas financial based,
could provide more detailed information on Hamas fundraising
links to European non-profits.

Foreign Ministry officials also raised the following other
sanctions issues:

Helms-Burton & ILSA - Mr Goff noted that these are outside of
his office's direct responsibility, but assured the Dutch
that our policies continue in place. Werner said that with
Castro's recent crackdowns on dissent, the EU was reviewing
its common position toward Cuba on an almost daily basis

Libya: Goff reiterated that per high level statements, U.S.
sanctions remain in place;

Iraq- The Dutch urged the U.S. to work with the UN to
designate additional individuals under UNSC Res 1483 in order
to provide clear guidance to financial institutions regarding
the accounts they were supposed to take action toward. They
noted the existence of Iraq-related accounts frozen in the
Netherlands stemming from UN resolutions following the First
Gulf War. However, the Netherlands would not be able to turn
these funds over to the Iraq Development Fund until new
legislation allowing for confiscation of these assets is
approved and enacted domestically.

Dutch Bankers Association
--------------

8. Goff and Kushner also met with Netherlands Bankers
Association Secretary for Security Affairs Ruud K. Oord and
ABN AMRO Director of Group Compliance M.A. Dorgelo. These
officials reaffirmed the continuing commitment of Dutch
financial institutions to deny terrorists use of the
financial system but noted it has been difficult for banks to
absorb and implement the many new regulations and procedures
imposed by government authorities in their efforts against
terrorist financing. Dorgelo observed that there has been
very little feedback from security agencies on SARs reporting
and other efforts by banks to identify suspect transactions
and individuals. He emphasized that without feedback the
edge would go out of the program. Mr. Oord also observed
that unlike in the U.S., banks in the Netherlands are liable
if they freeze in error, even if it is pursuant to official
direction. This stands, he stated, in direct contrast to
U.S. practice where the liability is absorbed by OFAC.
SOBEL