TERRORISM FINANCE: FRENCH AUTHORITY TO FREEZE

UNCLAS PARIS 003292

SIPDIS

SENSITIVE

STATE FOR EB/ESC/TFS (LLAMBERT),EUR/ERA AND EUR/WE
TREASURY FOR TFFC, OFAC
JUSTICE FOR CRM/ARFMLS

E.O. 12958: N/A
TAGS: ETTC PTER EFIN KTFN FR PGOV EUN
SUBJECT: TERRORISM FINANCE: FRENCH AUTHORITY TO FREEZE
ASSETS

REF: A. 04 STATE 193684

B. STATE 28352

C. STATE 32688

D. STATE 32549

E. PARIS 7561


1. (SBU) Per reftels, Post includes below points on French
asset-freezing authority for terrorist finance issues.


2. (SBU) France's legal authority to freeze assets is based
on the state's traditional power to use capital controls
where necessary. Therefore, the main authority is based on
French administrative law, which is sufficient for the GOF to
exert full asset-freezing authority. Discussions on the
enacting of specific asset-freezing legislation have
continued but have not resulted in any concrete proposals.
Investigating judges (a judge that combines both
prosecutorial and judicial authority) can also order the
seizure or freeze of assets of individuals under
investigation. Three investigating judges specialize in
investigating financial crimes and recently have collaborated
with terrorism investigating judges on terrorism finance
cases.


3. (SBU) France's Ministry of Finance implements sanctions
against individuals and organizations, while approval to
designate comes from the Ministry of Foreign Affairs (in
collaboration with French intelligence agencies). The
Ministry of Foreign Affairs authorizes and transmits national
positions regarding individuals and entities proposed for
listing by the EU Clearing House mechanism.


4. (SBU) France has national authority to freeze terrorist
assets, and this authority is fully autonomous. Once the
Ministry of Foreign Affairs has given its approval to
designate, the Ministry of Finance implements the decision.
In general, France does not designate lightly. It will not
designate solely based on outside pressure, and insists on
making an independent decision. It does not hesitate to buck
consensus in the Clearing House if necessary and furthermore,
it is especially touchy regarding the confidentiality of
Clearing House discussions.


5. (SBU) No structural impediments currently exist for more
robust cooperation on co-sponsoring designations. In
general, French officials are eager to co-sponsor in
situations where they agree on the merit of the designation,
believing that cooperation at the UN is a key strength of the
US-French counter-terrorism relationship. Most differences
of opinion can be managed by comparing information on
potential designees. The most important exception to this
daily cooperation is French intransigence on designating
Hezbollah. Although France claims it has not received
definitive evidence of Hezbollah involvement in terrorism,
designation in this case is a political decision with
President Chirac believed to be the final arbiter.


6. (SBU) France would likely reject USG offers of training
and technical assistance in the belief that they possess the
same level of technical competence as their USG counterparts.
They would likely welcome expert-level and political-level
exchanges/discussions on terrorism finance issues.


7. (SBU) Given France's significant immigrant population, it
is potentially a "high" risk as a site for significant fund
raising for terrorists. The GOF recognizes this threat and
has recently redoubled its efforts to focus on terrorist
financing issues. On April 18-19, French police arrested
twelve people in the Parisian area on suspicion of financing
terrorist/Islamist causes. Three of those arrested continue
to be held in detention, and one of them has been formally
placed under investigation on terrorism finance charges. The
mid-April sweep was the first in a joint investigation begun
February 25 by terrorism investigating judge Jean-Louis
Bruguiere and financial crime investigating judge Philippe
Courroye. Ref E details how the GOF investigates terrorist
finance from an administrative (as opposed to judicial)
perspective.
WOLFF