TERRORISM FINANCE: 2005 UPDATE NO. 2 - GREECE

C O N F I D E N T I A L ATHENS 000777

SIPDIS

STATE PASS EB/ESC/TFS (DAVID NELSON),S/CT (TODD KUSHNER),
IO/PSC (JOLEEN SCWEITZER),EB/EPPD (CAROL THOMPSON),EUR/SE
TREASURY PASS JUAN ZARATE, OFAC (ROBERT WERNER)

E.O. 12958: DECL: 03/18/2115
TAGS: PREL KTFN EFIN PTER ETTC CVIS GR
SUBJECT: TERRORISM FINANCE: 2005 UPDATE NO. 2 - GREECE

REF: STATE 32688

Classified By: CLASSIFIED BY: ECONCOUNS JSTEPANCHUK; REASONS 1.4 (B,D)


1. (C) According to GoG officials, assets frozen, forfeited
or seized by the GoG pursuant to UNSCR resolutions 1267 and
1373 have been insignificant (several thousand dollars).


2. (C) The Bank of Greece (central bank) and the Ministry of
Economy and Finance have the legal and administrative
authority to identify, freeze and seize terrorist assets.
The Bank of Greece and the Ministry of Economy and Finance
have circulated to all financial and credit institutions the
names of individuals and entities that have been included on
the UN 1267 Sanctions Committee's consolidated list as being
linked to UBL, members of the al-Qa'ida organization or the
Taliban, or that the EU has designated under the relevant
authorities.


3. (C) The GoG has cooperated closely with us to investigate
those organizations and individuals the U.S. has designated
for asset freezing, and the banking system in Greece fulfills
its obligations under international resolutions. There are
no significant impediments to co-sponsoring designations with
GoG under UNSCR 1267 and 1373. The establishment of an
intergovernmental committee to monitor terrorism financing
following 9/11 has facilitated communications between the
Bank of Greece and the Economics and Finance Ministry.
However, designations not subject to UNSCR 1267, 1373 and EU
regulations require the involvement of the MFA, Justice and
other ministries as appropriate. The decision making process
under such circumstances is cumbersome, and many cases are
still awaiting resolution through the EU clearinghouse
process.


4. (C) We believe GoG would be receptive to accept USG
training and technical assistance, including an assessment of
training needs. The Bank of Greece has been overwhelmed by
the sheer volume of designations. Its supervision department
immediate acts upon our notifications by instructing
commercial banks and credit institutions to begin a records
search for accounts identifiable with the designations. The
records search is often complicated by the many permutations
of some Arabic names, as well as the fact that many branch
banks in the provinces are still not computerized and much of
the record keeping is still done by hand. Our contacts in
the Economic and Finance Ministry believe that seminars on
terrorism financing involving banking supervision departments
of the major Greek commercial banks would be a useful form of
training and technical assistance.


5. (C) Greece is a low risk country regarding significant
fund raising or banking services for terrorists. Greek
officials have told us that amounts seized to date under
UNSCR 1273 have been insignificant and Greece has not been
traditionally a financial safe haven for
terrorists/organizations affiliated with al-Qa'ida. The
bureaucratic obstacles in registering charitable
organizations (and the fact that all non-profit organizations
are scrutinized by tax authorities) make it unlikely that
"hawalas" could operate here undetected.
Ries