Expanding USG Financial Crimes Training to

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STATE FOR EAP/CM, EB/ESC/TFS
STATE FOR INL
TREASURY FOR LEVEY/GLASER/SHARMA/LAROSA
FBI FOR MONEY LAUNDERING UNIT/FINANCIAL CRIMES SECTION
DEA FOR FINANCIAL OPERATIONS

SENSITIVE
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E.O. 12958: N/A
TAGS: ECON EFIN PREL MC
SUBJECT: Expanding USG Financial Crimes Training to
Macau


1. (SBU) SUMMARY AND ACTION REQUEST: During 2005 - 2006
the USG has provided Macau's law enforcement authorities
substantial training in anti-money laundering, financial
crimes and counterterrorism financing (detailed in para 7).
The USG-sponsored training has focused on providing Macau's
law enforcement authorities with tools to identify and
investigate money laundering, terrorist financing, credit
card/bank fraud, cybercrime and other financial crimes.
Macau passed significant anti-money legislation in 2006 and,
as a next step, will be working on developing the knowledge
and institutional means to effectively integrate the
investigatory, analytic and prosecutorial aspects of a sound
financial regulatory system. With Macau in the process of
establishing a Financial Intelligence Unit (FIU),ConGen
Hong Kong's Law Enforcement Committee recommends that the
next stage of training focus on enhancing Macau's senior
Monetary Authority and Law Enforcement officials?
understanding of FIU operations, to include receiving,
analyzing and disseminating suspicious transaction reports;
working with the Public Prosecutions Office on how to
prosecute cases; and sharing information with other
jurisdictions. The goal would be to strengthen Macau's FIU
operations and help it move toward Egmont-type operations
and membership.


2. (SBU) ConGen Hong Kong requests Washington agencies
consider what type of USG expertise could be made available
toward this end, possibly, but not limited to deploying to
Macau resident advisors from Treasury's Office of Technical
Assistance, trainers from IRS-CID National Criminal
Investigation Training Academy and/or instructors from the
International Financial Fraud Training Program (IFFTP).
Macau's growing casino industry has provided the MSARG with
rapidly increasing tax revenues and larger budgets and its
possible that the Macau Special Administrative Region
Government (MSARG) would be able to cover some of the
training costs. END SUMMARY AND ACTION REQUEST.


3. (U) The United States Government is increasing its
interactions/profile in Macau in commercial, economic,
financial, law enforcement and other areas. U.S. private
sector investment is growing rapidly in Macau, particularly
in the gaming, tourism and convention industries. In 2006,
U.S. investment in Macau is estimated to reach US$2.5
billion and in the three-year period from 2006 - 2008 will
likely surpass US$8 billion. Two U.S. gaming enterprises
have operations in Macau, the Sands and Wynn. The Sands
opened a casino in May 2005 and the Wynn opened a
resort/casino in September 2006. MGM is building a
resort/casino in Macau, scheduled to open in 2007. The
Sands Venetian is building a 3000-room
resort/casino/convention center that is scheduled to open in

2007.


4. (SBU) Since the U.S. Treasury Department designated
Macau-based Banco Delta Asia as a "primary money laundering
concern" in September 2005, the Macau Monetary Authority has
been cooperating with U.S. Treasury authorities in
investigating the bank. On March 23, 2006, the MSARG passed
a 12-article anti-money laundering bill. Macau is in the
process of establishing a Financial Intelligence Unit (FIU).
The FIU is working with the Macau Judiciary Police on
protocols for the receipt of suspicious transactions reports
(STRs) and with the Public Prosecutions Office on how to
prosecute financial crimes cases.


5. (U) As the USG supports Macau's efforts to strengthen
the regulatory oversight of its financial, banking and
casino sectors and as U.S. investment continues flowing into
Macau, training efforts as mentioned below provide an
opportunity to strengthen U.S. - Macau law enforcement ties
and provide much needed and appreciated capacity building to

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Macau's law enforcement community. Post notes that in
January 2007, the Drug Enforcement Administration (DEA) will
conduct an additional Anti-Money Laundering Course for
approximately forty members of Macau's Judiciary Police.


6. (U) Post's Law Enforcement Committee (chaired by the
Consul General and Deputy Principal Officer and consisting
of representatives from State's Economic/Political and
Consular Sections and Regional Security Office, FBI, DEA,
DHS/ICE, DHS/CBP, IRS-CID, USSS, Department of
Commerce/Bureau of Industry and Security, and Executive
Staff) notes that so far training has been geared toward
providing Macau's law enforcement authorities with tools to
identify and investigate money laundering, terrorist
financing, credit card/bank fraud, cybercrime and other
financial crimes. Post's Law Enforcement Committee members
support this ongoing training by both coordinating the
training and in sharing their in-house expertise with
Macau's law enforcement authorities. Post's Law Enforcement
Committee concurs that emphasis should be shifted in coming
months to a higher-level, toward encouraging information
sharing and prosecutions of financial crimes in Macau. With
the MSARG in the process of establishing a Financial
Intelligence Unit (FIU),the newly formed FIU would benefit
from training in the receipt, analysis and dissemination of
suspicious transaction reports, working with the public
prosecutors office on how to prosecute cases and information
sharing with other jurisdictions pursuant to the Egmont
guidelines for FIUs. USG-provided training would usually
emphasize improving the skills and policy understanding of
more senior Macau regulatory officials, in addition to the
law enforcement officers.

Recent Training Programs for Macau
--------------


7. USG-provided anti-money laundering training/financial
crimes training to Macau police authorities during 2005 -
2006:

-November 13 - 17, 2006: U.S. Secret Service (USSS) and
Department of Homeland Security Immigration and Customs
Enforcement (DHS/ICE) and Customs and Border Protection
(DHS/CBP) personnel provided training to Macau Law
Enforcement Officers from the Unitary Police Force, the
Judiciary Police and the Public Security Police. (NOTE:
The Unitary Police Services oversee both the Judiciary
Police and the Public Security Police, making both sides
work in tandem. The Judiciary Police is responsible for
serious crime investigations and the Public Security Police
is primarily responsible for maintaining law and order.)
Training consisted of detection of U.S. counterfeit
banknotes, credit card/bank fraud, cybercrime and money
laundering. Macau mid-level/working investigators attended
the training, which focused on measures/procedures for
actual criminal field investigations. The training was well
received by the Macau officers. Additionally, the U.S.
Secret Service conducted a separate seminar that covered

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counterfeit U.S. currency detection on November 15 for the
Macau Monetary Authority, with approximately sixty
participants from various Macau banks and casinos taking
part. The Department of State's Bureau of International
Narcotics and Law Enforcement Affairs (INL) proposed this
training course for the Macau Police authorities and
provided funding for the visiting U.S. Secret Service
trainers.

-April 24 - 28, 2006: U.S. Treasury's Office of Technical
Assistance and Internal Revenue Service - Criminal
Investigation Division (IRS-CID) Hong Kong collaborated to
provide a one week training course in Macau. The focus of
the course was on Financial Investigative Techniques, Money

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Laundering, and Terrorist Financing, and included
approximately 48 participants from the Macau Gaming
Inspection, Judiciary Police, Financial Services Bureau,
Customs, Unitary Police, Commission Against Corruption,
Trade and Investment Promotion Bureau, Monetary Authority,
and the Justice Department. One afternoon session was open
to the financial sector, and included approximately 100
participants from banks and other financial institutions in
Macau.

- Since October 2005, the Consulate's Regional Security
Office has sent 22 Macau police officers to the
International Law Enforcement Academy (ILEA) in Bangkok,
Thailand. At ILEA, the Macau Officers have taken courses on
complex financial investigations, computer crimes,
intellectual property rights as well as post-blast
investigations, crime scene investigations, facility
security and officer survival. The Macau police say the
professional training they receive from ILEA, and the
opportunity to meet counterparts from other Asian countries,
have benefited the police force.

-May 24 - 25, 2005: The Federal Bureau of Investigation
(FBI) in collaboration with IRS-CID and DHS/ICE sponsored a
seminar at Hong Kong Police Headquarters on money laundering
techniques. Assistant Director of the IRS-CID National
Criminal Investigation Training Academy, Advanced Training
Section, provided a presentation on border-related money
laundering techniques involving "casa de cambios" (exchange
houses) at the U.S. border. The Macau Judiciary Police
attended this seminar, which provided an opportunity for
both liaison and technical assistance.

-February 24 - 25, 2005: The FBI in collaboration with IRS-
CID and DHS/ICE sponsored a seminar at Hong Kong Police
Force Headquarters on anti-money laundering and the counter-
financing of terrorism. The Macau Judiciary Police attended
this seminar, which provided an opportunity for both liaison
and technical assistance.

-January 10 - 14, 2005 - Drug Enforcement Administration
Hong Kong Country Office hosted a Money Laundering/Asset
Forfeiture Training Seminar in Macau, conducted by the DEA's
Office of International Training. Officers from the Unitary
Police Bureau, Judiciary Police, Gaming Commission, Office
of Economy and Finance, Gaming Inspection Bureau, Office of
International Affairs, Monetary Authority and Office of
Legal Affairs attended.

Cunningham