Identifier
Created
Classification
Origin
06ANKARA5251
2006-09-12 14:02:00
SECRET
Embassy Ankara
Cable title:  

TURKEY - ASSESSMENT OF TERRORIST/INSURGENT FINANCE

Tags:  KTFN PTER TU IZ 
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RR RUEHWEB

DE RUEHAK #5251/01 2551402
ZNY SSSSS ZZH
R 121402Z SEP 06
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC 8572
INFO RUEHAM/AMEMBASSY AMMAN 0846
RUEHGB/AMEMBASSY BAGHDAD 0734
RUEHEG/AMEMBASSY CAIRO 0335
RUEHDM/AMEMBASSY DAMASCUS 1577
RUEHKU/AMEMBASSY KUWAIT 0856
RUEHRH/AMEMBASSY RIYADH 0611
RUEHIT/AMCONSUL ISTANBUL 1244
RUEATRS/DEPT OF TREASURY WASHDC
RUEAWJA/DEPT OF JUSTICE WASHDC
RUEAIIA/CIA WASHDC
S E C R E T ANKARA 005251 

SIPDIS

SIPDIS

TREASURY FOR OTI

E.O. 12958: DECL: 09/12/2016
TAGS: KTFN PTER TU IZ
SUBJECT: TURKEY - ASSESSMENT OF TERRORIST/INSURGENT FINANCE
OPERATING ENVIRONMENTS IN COUNTRIES NEIGHBORING IRAQ

REF: A. STATE 132693

B. ANKARA 5139

Classified By: Economic Counselor Thomas Goldberger for reasons
1.4(b) and (d).

S E C R E T ANKARA 005251

SIPDIS

SIPDIS

TREASURY FOR OTI

E.O. 12958: DECL: 09/12/2016
TAGS: KTFN PTER TU IZ
SUBJECT: TURKEY - ASSESSMENT OF TERRORIST/INSURGENT FINANCE
OPERATING ENVIRONMENTS IN COUNTRIES NEIGHBORING IRAQ

REF: A. STATE 132693

B. ANKARA 5139

Classified By: Economic Counselor Thomas Goldberger for reasons
1.4(b) and (d).


1. (S) SUMMARY AND INTRODUCTION: This cable details Embassy
Ankara's assessment of the terrorist/insurgent financing
environment in Turkey as requested in ref a. Embassy Ankara
and our Turkish Government contacts have little information
about support for the Iraqi insurgency coming from Turkey.
We have every reason to believe, however, that some degree of
support does originate in -- or transit through -- Turkey but
it is highly clandestine and, if known, would be vigorously
countered by the Turkish authorities. End Summary.

--------------
Background Information
--------------


2. (S) The Turkish authorities do not permit
terrorist/insurgent recruitment, training, or travel
facilitation in Turkey, and take prompt action against
attempts to engage in such activities when they are
discovered. Neither Embassy Ankara nor our contacts are
aware of any specific information regarding fundraising,
movement of funds or materials, travel facilitation,
recruitment web-hosting, or training camps in Turkey relating
to the Iraqi insurgency. The Turkish National Police (TNP)
have substantial resources devoted to counterterrorism;
however, they view PKK and other homegrown Turkish terrorist
groups such as DHKPC as their priority targets. The
Government of Turkey (GOT) maintains close relationships with
USG intelligence agencies working on these issues, and where
appropriate the USG has provided training opportunities to
Turkish counterparts in the police and judicial sectors to
combat terrorism, including terrorism financing.


3. (S) If donations to the Iraqi insurgency are originating
in Turkey, they likely would not be channeled through mosques
which are under state control; all imams are civil servants
who work for, and are supervised by, the Religious Affairs
Directorate(Diyanet)in Ankara. Donations would have to be
collected in a clandestine fashion. Given that overall
financial control mechanisms are relatively weak and the
Turkish authorities' focus on homegrown terrorist groups,

support for the insurgency could flow through Turkey
undetected, particularly through the use of cash couriers and
alternative remittance systems (hawalas).


4. (S) Post is not aware of any individuals playing a role in
raising funds for the Iraqi insurgency. However, Jihadist
groups with sympathy for the Iraqi insurgency do exist in
Turkey and could be providing support. We do not believe any
former members of Saddam Hussein's regime reside in Turkey.
We are not aware of funds flowing from Iraq into or through
Turkey to finance terrorist activity elsewhere, other than
PKK funds emanating from the PKK headquarters in northern
Iraq (or PKK entities in Europe) that flow into Turkey for
use in PKK attacks in Turkey.

--------------
Current Legal Regime
--------------


5. (SBU) Turkey's current legal framework is not equipped to
effectively combat financial flows through Turkey to
terrorist groups inside or outside Turkey. Information on
Turkey,s AML/CTF regime is available in the INSCR report and
from previous post reporting. Various existing laws with
provisions that can be used to punish the financing of
terrorism include articles 220, 314, and 315 of the Turkish
penal code, which prohibit assistance in any form to a
criminal organization or to any organization that acts to
influence public services, media, proceedings of bids,
concessions, and licenses, or to gain votes, by using or
threatening violence. The Government of Turkey (GOT)
submitted to Parliament in November 2005 the "MASAK law"
(named after the Turkish financial crime intelligence agency
that it seeks to reorganize). The law was approved by
Parliamentary commission early in 2006 but Parliament
recessed for the summer without having passed this
legislation. Passage is expected when Parliament reconvenes.
Separately, the Turkish Government declined to amend Turkey's
Anti-Terror Law in 2006 to extend the definition of terrorism
beyond acts directly aimed at Turkish interests. Though the
recently-passed amendments to that law explicitly
criminalized terrorism finance, until the definition is
expanded, under Turkish law there is no predicate offense
that would permit action against financing in support of
international terror groups.


6. (SBU) Turkey first criminalized money laundering in 1996.
The law included a wide range of predicate offenses,
including narcotics-related crimes, smuggling of arms and
antiquities, terrorism, and counterfeiting. Under the law,
whoever commits a money laundering offense faces a sentence
of two to five years in prison, and is subject to a fine of
double the amount of the money laundered and asset forfeiture
provisions. Turkey has a system for identifying, tracing,
freezing, and seizing assets that are not related to
terrorism, although the law allows only for their criminal
forfeiture and not their administrative forfeiture.
Legitimate businesses can be seized if used to launder drug
money or support terrorist activity, or are related to other
criminal proceeds. Additional anti-money laundering
legislation enacted in 2004, which took effect in June 2005,
broadly defines money laundering to include all predicate
offenses punishable by one year's imprisonment.


7. (SBU) Turkey's Council of Ministers (COM) promulgated a
decree (2483/2001) to freeze all the funds and financial
assets of individuals and organizations included on the UNSCR
1267 Sanctions Committee's consolidated list, which is
distributed to all relevant agencies and financial
institutions. However, the tools currently available under
Turkish law for locating, freezing, seizing, and confiscating
terrorist assets are cumbersome, limited, and not
particularly effective. For example, there is no legal
mechanism to freeze the assets of terrorists not on the 1267
committee's consolidated list.


8. (SBU) Turkey is a member of the Financial Action Task
Force (FATF),and MASAK is a member of the Egmont Group.
FATF is currently conducting a mutual review of Turke's
AML/CTF regime. Turkey is a party to the UN International
Convention for Supression of the Financing of Terrorism, and
has signed and ratified the UN Convention on Laundering,
Search, Seizure, and Confiscation of the Proceeds of Crime.
However, Turkey's implementation efforts on the UN
anti-financial crime conventions have been weak thus far, and
Turkey is probably not currently compliant with FATF's
Special Recommendations on Terrorist Financing. The new
MASAK law, when passed, will likely improve Turkey's level of
compliance with these special recommendations.


9. (SBU) The COM passed a set of regulations that require the
filing of suspicious transaction reports (STRs),customer
identification, and he maintenance of transaction records
for five years. These regulations apply to banks and a wide
range of non-bank financial institutions, including insurance
firms and jewelry dealers. The number of STRs being filed is
quite low, even taking into consideration the fact that many
commercial transactions are paid in cash. From January to
November 2005, 266 STRs were filed. A possible reason for
this is the lack of safe harbor protection for bankers and
other filers of STRs. The MASAK law, once passed, will
provide for safe harbor for filers of STR's.


10. (SBU) Turkey does not have foreign exchange restrictions.
With limited exceptions, banks and special financial
institutions must inform authorities, within 30 days, about
transfers abroad exceeding $50,000 or its equivalent in
foreign currency notes (including transfers from foreign
exchange deposits). Travelers may take up to $5,000 or its
equivalent in foreign currency notes out of the country.
Turkey does have cross-border currency reporting requirements.

--------------
Implementation
--------------


11. (SBU) Turkey's administration and enforcement of
counter-terrorist/insurgent financing measures is weak.
Turkey's coordination among various entities charged with
responsibility in its anti-money laundering and
counterterrorist financing regime, including various courts
with responsibilities for these issues, needs to improve
before there can be any increase in the number of successful
investigations and prosecutions. According to MASAK
statistics, it has pursued more than 2,100 money laundering
investigations since its inception, but as of July 2005, only
eight had resulted in convictions. One factor contributing
to the low conviction rate is the fact that Turkey's police,
prosecutors, judges, and investigators need additional
training in dealing with financial crimes. Only after the
MASAK law is passed will Turkey have a specific government
agency responsible for implementing terrorism finance
legislation.


12. (SBU) Post is unaware of any raids or arrests of
significant terrorist/insurgent finance personalities.


13. (SBU) Turkey has frozen assets of two individuals under
UNSCR 1267: Yassin Al-Qadi(ref 5139) and Nasredin. The GOT
circulates the names of UN-designated sanctions targets to
all the relevant ministries and state entities, including
TNP, jandarma, military, intelligence community, and banks.
Turkey is willing and able to investigate, and, if
appropriate, freeze assets based on information provided by
the USG, but can only freeze the assets if the individual or
group is designated by a UN Security Council resolution.


14. (SBU) Post believes Turkey has complied with its
obligations under UNSCR 1483 to return former regime assets
to the Development Fund for Iraq. In 2003 and 2004, post
demarched the Turkish Government to repatriate Iraqi assets.
Following discussions between CPA/Iraqi officials and Turkey,
our understanding is that all claims were resolved.


15. (SBU) In July 2001, the Ministry of Finance issued a
banking regulation circular requiring all banks, including
the Central Bank, securities companies, post office banks,
and Islamic financial houses, to record tax identity
information for all customers opening new accounts, applying
for checkbooks, or cashing checks. The circular also
requires exchange offices to sign contracts with their
clients. The Ministry of Finance also issued a circular
mandating that a tax identity number be used in all financial
transactions as of September 1, 2001. Turkey does not have
secrecy laws that prevent disclosure of client and ownership
information to bank supervisors and law enforcement
officials. According to anti-money laundering law Article 5,
public institutions, individuals, and corporate bodies must
submit information and documents as well as adequate
supporting information upon the request of Turkey's Financial
Crimes Investigation Board (MASAK) or other authorities
specified in Article 3 of the law. Natural persons and
corporate bodies from whom information and documents are
requested may not withhold the requested items by claiming
the protection provided by privacy provisions in order to
avoid submitting the requested items. A new banking law was
enacted in 2005 to strengthen bank supervision, pursuant to
which the Banking Regulatory and Supervisory Agency (BRSA)
conducts periodic anti-money laundering and compliance
reviews under authority delegated by MASAK. Implementing
regulations for the new law are in being prepared with
implementation required under Turkey's IMF program by the end
of 2006.


16. (SBU) Unlike in the formal financial sector, effective
monitoring of alternative remittance systems and cash
couriers, are weak. Alternative remittance systems are
illegal in Turkey but are known to exist.

--------------
Communication
--------------


17. (C) Turkey's ongoing struggle to combat domestic
terrorism targeting Turkish interests makes it an ally in the
fight against all types of violent extremism. Turkey publicly
condemns terrorist acts. The Turkish Government opposes the
insurgency in Iraq and shares our goal of a unified, stable,
and peaceful Iraq; the GOT sees any sort of dismemberment of
Iraq as against its interests and, to our knowledge,in no way
supports the insurgency. Nor is it taking different
positions on the insurgency with different audiences. If
Embassy officials request inforation, the GOT is responsive
to such requests. Post is unaware of the GOT's information
sharing activities, if any, with the government of Iraq. If
any individuals within Turkey desire to raise funds for
insurgents in Iraq, such fundraising would have to be done
clandestinely, as the GOT would take appropriate measures to
combat them.

Visit Ankara's Classified Web Site at
http://www.state.sgov.gov/p/eur/ankara/

WILSON