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IdentifierCreatedClassificationOrigin
04TELAVIV1392 2004-03-05 15:00:00 CONFIDENTIAL Embassy Tel Aviv
Cable title:  

GOI INFO ON RAMALLAH BANK RAID

This record is a partial extract of the original cable. The full text of the original cable is not available.
					  C O N F I D E N T I A L SECTION 01 OF 02 TEL AVIV 001392 

SIPDIS

NEA FOR BURNS/SATTERFIELD AND NEA/IPA
EB FOR WAYNE
NSC FOR ABRAMS/DANIN/KIFAYAT

E.O. 12958: DECL: 03/05/2014
TAGS: EFIN ECON PREL KPAL KWBG IS ISRAELI PALESTINIAN AFFAIRS COUNTERTERRORISM
SUBJECT: GOI INFO ON RAMALLAH BANK RAID

REF: A. TEL AVIV 1325


B. JERUSALEM 662

Classified By: Deputy Chief of Mission Richard LeBaron for reasons 1.4
(b) and (d).

This message has been cleared by ConGen Jerusalem.



1. (C) Summary: In separate meetings this week with Shin
Bet liaison officers and the head of Israel's counter
terrorist financing effort at the Israeli NSC and the Mossad,
GOI officials provided some additional details on last week's
raid on Palestinian banks. The GOI officials rejected the
criticism that the GOI had not attempted to use PA Finance
Minister Fayyad as a conduit for handling terrorist financing
issues. (Note: Fayyad told ConGen Economic Counselor that
he has never been approached by the GOI with actionable
terrorist financing information since reaching an agreement
with the PM's Chief of Staff Dov Weissglas. End note.) They
also defended the military operation to seize the funds as
the only effective avenue remaining to them. Despite these
statements, the GOI officials appeared eager to find less
controversial ways of preventing the use of Palestinian banks
as vehicles for terrorist financing. (Post Terrorism Finance
Working Group is developing ideas on better ways to ensure
effective Israeli/Palestinian engagement on terrorist finance
cases. see septel.) End summary.



2. (C) On March 2, Embassy econoff, Legatt, and FBI special
agents met with Shin Bet liaison officers Arnon Vinceze and
Ilan Kosanivich to discuss last week's raid on the banks in
Ramallah. Kosanivish began by giving the group a readout on
the actions. According to Kosanivish, the GOI had
information on 45 "association accounts" related mostly to
Hamas and information on 250 accounts linked to private
persons. Kosanivich said that each of these accounts could
be traced to specific terrorist activity and that they would
provide U.S. law enforcement with that information.
Kosanivich claimed that they did not copy the banks' hard
drives and other transaction information on these accounts.
Kosanivich said that they gathered only the balance
information from the accounts and then withdrew that amount
from the banks' vaults. They claimed that they took NIS 35
million from "association accounts" and NIS 2.5 million from
personal accounts. Vinceze said that all of these accounts
were funded by direct wire transfers from Jordan, and so
there was no possibility for the GOI to freeze this money in
Israeli correspondent banks. In response to questions about
why they had not sought to work with the PA on freezing these
accounts, Kosanivich claimed that the GOI had approached
Fayyad on two separate occasions regarding accounts connected
to Hamas, but that Fayyad had not taken action. (Note: The
Shin Bet officials did not suggest that the accounts they
asked Fayyad to seize were among those affected in last
week's raid, nor did they provide information as to when
these inquiries were made. End note.) Legatt queried the
officials as to why they decided to act in a way that
appeared to affect the banks more than the account holders.
Vinceze said that this would result in terrorists being less
likely to use the banks as a means of transmitting funds and
would instead opt for other channels that the Shin Bet is
more confident in their ability to find and seize. For
example, Vinceze said the Shin Bet feels more confident in
its ability to identify and take action against cash couriers
than in stopping bank transfers.



3. (C) Udi Levi, the head of Israel's counter-terrorist
financing effort at the Israeli NSC and the Mossad, told
Embassy econoff on March 3 that the GOI is eager to work with
the U.S. and the PA to find less destructive and
controversial means of combating terrorist funds. Levi was
frustrated, however, by what he perceived as past
unwillingness on the part of Fayyad and the PA to take action
when given the opportunity. Levi repeated the Shin Bet's
assertion that the GOI had attempted to use Fayyad as a
conduit for taking action on suspected terrorist accounts
during the past year but had been unsuccessful. Despite the
past failures of these efforts, Levi said the GOI must
explore ways to prevent future incidents like last week, but
in a way that is still effective in combating the illicit
flow of funds to Palestinian terrorists. Levi said that GOI
officials would meet with U.S. and PA officials to explore
other options.

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