Identifier
Created
Classification
Origin
06BERLIN3505
2006-12-14 17:08:00
SECRET
Embassy Berlin
Cable title:  

GERMAN REQUEST CONCERNING KOMID FINANCIAL

Tags:  EFIN PARM KNNP PREL PGOV KNAR GM CH 
pdf how-to read a cable
VZCZCXYZ0000
OO RUEHWEB

DE RUEHRL #3505 3481708
ZNY SSSSS ZZH
O 141708Z DEC 06
FM AMEMBASSY BERLIN
TO RUEHC/SECSTATE WASHDC IMMEDIATE 6420
INFO RHEHNSC/NSC WASHDC IMMEDIATE
RUEHBJ/AMEMBASSY BEIJING PRIORITY 0841
S E C R E T BERLIN 003505 

SIPDIS

STATE FOR EAP/K, EUR/PRA, AND ISN/CPI
SIPDIS

E.O. 12958: DECL: UPON KOREAN UNIFICATION
TAGS: EFIN PARM KNNP PREL PGOV KNAR GM CH
SUBJECT: GERMAN REQUEST CONCERNING KOMID FINANCIAL
ACTIVITIES IN GERMANY

REF: A. BERLIN 3259

B. STATE 182889

Classified By: Minister-Counselor for Economic Affairs Robert F. Cekuta
, for reasons 1.4 (b) and (d).

S E C R E T BERLIN 003505

SIPDIS

STATE FOR EAP/K, EUR/PRA, AND ISN/CPI
SIPDIS

E.O. 12958: DECL: UPON KOREAN UNIFICATION
TAGS: EFIN PARM KNNP PREL PGOV KNAR GM CH
SUBJECT: GERMAN REQUEST CONCERNING KOMID FINANCIAL
ACTIVITIES IN GERMANY

REF: A. BERLIN 3259

B. STATE 182889

Classified By: Minister-Counselor for Economic Affairs Robert F. Cekuta
, for reasons 1.4 (b) and (d).


1. (S) Global Affairs officer met Christian Mayer, deputy
director of the German Finance Ministry's Division for
Monetary Transactions and Prevention of Money Laundering and
Terrorism Financing, November 24 to follow up ref B demarche
and the Germans' interim reply (ref A). Mayer said relevant
German Government offices had discussed the points in the
demarche and are sympathetic to our concerns. However, he
said they are unable to act due to legal constraints and the
need to provide further information to Germany's Deutsche
Bank.


2. (S) First, Mayer said, it may not be apparent to Deutsche
Bank that the ultimate beneficiary in this case is the DPRK's
Korea Mining Development Trading Company (KOMID),since
payment for the transaction was first to be made through an
account held by China Merchants Bank. Second, Deutsche Bank
would have no legal obligation to freeze KOMID's assets,
because KOMID is not yet listed on UNSCR 1718's annex of
targeted entities. Nor is it on the EU's list of targeted
entities. Third, because payment for the transaction is to
occur when the China Merchants Bank pays KOMID in Beijing,
Germany has no jurisdiction. Mayer said that if the China
Merchants Bank had legally established the account at
Deutsche Bank and the customer wanted to withdraw funds from
it, the German Government could not prevent the German bank
from transferring the funds.


2. (S) Mayer suggested the best way to approach the issue
would be to disclose the U.S. information to Deutsche Bank.
He said that Deutsche Bank is mindful of the provisions of
U.S. Executive Order 13382 and would wish to avoid U.S.
actions against it. However, Deutsche Bank needs to know
that KOMID is the beneficiary of the financial transactions
in question. Mayer requested that the USG provide the
necessary information on KOMID in a message releasable to
Deutsche Bank.


3. (S) While providing additional information to Deutsche
Bank as requested by Mayer remains an option, post is
unconvinced that the German Government cannot weigh in with
the bank. Indeed, our understanding is that there is
precedent for the German Government -- the Finance Ministry
and other ministries -- to advise informally German financial
institutions about potentially improper transactions. Post
will accordingly continue to press the German Government to
act against KOMID and raise the issue with higher levels in
the German Finance Ministry.
TIMKEN JR