Identifier
Created
Classification
Origin
07BUENOSAIRES78
2007-01-17 20:59:00
CONFIDENTIAL
Embassy Buenos Aires
Cable title:  

ARGENTINE PRESIDENT KIRCHNER SENDS

Tags:  KTFN EFIN PTER SNAR ETTC PREL AR 
pdf how-to read a cable
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OO RUEHWEB

DE RUEHBU #0078/01 0172059
ZNY CCCCC ZZH
O 172059Z JAN 07
FM AMEMBASSY BUENOS AIRES
TO RUEATRS/DEPT OF TREASURY WASHINGTON DC IMMEDIATE
RUEHC/SECSTATE WASHDC IMMEDIATE 6985
INFO RUEHAC/AMEMBASSY ASUNCION IMMEDIATE 5860
RUEHBR/AMEMBASSY BRASILIA IMMEDIATE 5704
RUEHMN/AMEMBASSY MONTEVIDEO IMMEDIATE 6083
RUCPDOC/USDOC WASHINGTON DC IMMEDIATE
RUEAIIA/CIA WASHINGTON DC IMMEDIATE
RUEABND/DEA HQS WASHINGTON DC IMMEDIATE
RHMFISS/DEPT OF HOMELAND SECURITY WASHINGTON DC IMMEDIATE
RHMFISS/DEPT OF JUSTICE WASHINGTON DC IMMEDIATE
RHEFDIA/DIA WASHINGTON DC IMMEDIATE
RHMFISS/HQ USSOUTHCOM MIAMI FL IMMEDIATE
RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC IMMEDIATE
C O N F I D E N T I A L BUENOS AIRES 000078 

SIPDIS

SIPDIS

PASS NSC FOR CARDENAS, ZARATE
E FOR THOMAS PIERCE, WHA FOR WHA/BSC AND WHA/EPSC
STATE FOR S/CT -- NOYES
STATE FOR EB/ESC -- DAS SIMONS AND JEAN CLARK
STATE FOR EB/ESC/TFS - LEANNE CANNON
STATE FOR INL/C/CP (PETERSON),INR/EC, S//CT (HILL),IO/PSC
(SANDAGE)
TREASURY FOR TFFS (HEFFERNAN, VANLINGEN, KLOSKI),OFAC,
FINCEN
TREASURY FOR ALICE FAIBISHENKO
DHS FOR ICE -- D.THOMPSON
JUSTICE FOR OIA AND AFMLS
USDOC FOR ALEXANDER PREACHER AND JOHN ANDERSEN
US SOUTHCOM FOR POLAD
PASS FED BOARD OF GOVERNORS FOR PATRICE ROBITAILLE
PASS USTR FOR SUE CRONIN AND MARY SULLIVAN

E.O. 12958: DECL: 11/19/2026
TAGS: KTFN EFIN PTER SNAR ETTC PREL AR
SUBJECT: ARGENTINE PRESIDENT KIRCHNER SENDS
COUNTER-TERRORISM FINANCE DRAFT LAW TO CONGRESS

Classified By: AMBASSADOR E.A. WAYNE FOR REASONS 1.4 (B AND D).

Summary
-------
C O N F I D E N T I A L BUENOS AIRES 000078

SIPDIS

SIPDIS

PASS NSC FOR CARDENAS, ZARATE
E FOR THOMAS PIERCE, WHA FOR WHA/BSC AND WHA/EPSC
STATE FOR S/CT -- NOYES
STATE FOR EB/ESC -- DAS SIMONS AND JEAN CLARK
STATE FOR EB/ESC/TFS - LEANNE CANNON
STATE FOR INL/C/CP (PETERSON),INR/EC, S//CT (HILL),IO/PSC
(SANDAGE)
TREASURY FOR TFFS (HEFFERNAN, VANLINGEN, KLOSKI),OFAC,
FINCEN
TREASURY FOR ALICE FAIBISHENKO
DHS FOR ICE -- D.THOMPSON
JUSTICE FOR OIA AND AFMLS
USDOC FOR ALEXANDER PREACHER AND JOHN ANDERSEN
US SOUTHCOM FOR POLAD
PASS FED BOARD OF GOVERNORS FOR PATRICE ROBITAILLE
PASS USTR FOR SUE CRONIN AND MARY SULLIVAN

E.O. 12958: DECL: 11/19/2026
TAGS: KTFN EFIN PTER SNAR ETTC PREL AR
SUBJECT: ARGENTINE PRESIDENT KIRCHNER SENDS
COUNTER-TERRORISM FINANCE DRAFT LAW TO CONGRESS

Classified By: AMBASSADOR E.A. WAYNE FOR REASONS 1.4 (B AND D).

Summary
--------------

1. (C) On December 20, Argentine President Kirchner sent the
GoA's draft anti-terrorism and counter-terrorism finance bill
to Congress. The GoA took this action in order to comply
with Financial Action Task Force (FATF) demands, and avoid
sanctions. Post lobbying contributed to this significant
achievement. The draft criminalizes terrorism and terrorism
financing and empowers law enforcement agencies to fight such
crimes. It is unclear whether the draft -- which is modeled
on German law -- meets FATF standards. First, to assuage
vocal opponents within Congress, the GoA restricted the
definition of acts of terror to exclude social protest.
Second, the draft also excludes individual acts of terrorism
by limiting application to groups of three or more persons,
which is similar to German law and in accordance with
Argentine Penal Code. Nevertheless, if passed, the law would
represent a marked improvement to the existing legal,
regulatory, and law enforcement framework. End Summary.

Kirchner Acts to Avoid FATF Sanctions
--------------

2. (C) President Kirchner's decision follows a lengthy
internal debate over the draft law, and was motivated by the
threat of FATF sanctions if it were not submitted to Congress
prior to FATF's mid-February 2007 Plenary. Over the last six

months, Juan Felix Marteau, the National Coordinator for
Anti-Money Laundering and Counter-Terrorism Finance
(AML/CTF),who reports to the Justice Minister, evaluated
over ten separate drafts before selecting the one currently
before the Argentine Senate. Marteau told Econoff January 17
that Kirchner will consider calling an extraordinary session
of Congress in February to move forward on this and other
pending legislation.


3. (C) The threat of sanctions stems from the June 2006 FATF
Plenary, during which FATF members granted Argentina six
months to amend its money laundering law, develop a national
AML/CTF strategy, and submit a terrorism finance bill to
Congress. The possible penalties for noncompliance included
a public statement that Argentina did not meet international
CTF norms, or even suspension of the GoA membership in FATF.
With the submission of this draft, the GoA appears to have
fulfilled all three demands. What remains is for FATF
members to decide during the February Plenary whether it
conforms to FATF standards (which are based on the
International Convention for the Suppression of the Financing
of Terrorism).

Embassy Advocacy Efforts Help Overcome Opposition
-------------- --------------

4. (C) Embassy efforts (and those of other FATF member
Embassies in Buenos Aires) helped convince Kirchner to
support the bill. Kirchner faced strong opposition to the
law from his own supporters in Congress, many of whom are
ex-Monteneros and fought the government during the 1970s.
These opponents are concerned that the law's attempt to
define terrorism could potentially encompass social protest
and acts of civil disobedience, such as those of the
Monteneros in the 1970s or actions taken by current day
street protestors, known as "Piqueteros." As late as


mid-December it was still unclear that Kirchner was prepared
to override this resistance from within his own power base.


5. (C) The Ambassador made it an Embassy priority to counter
this opposition, raising the issue with the Justice,
Interior, and Economic Ministers, and Central Bank President.
In mid-December, when GoA resolve appeared to waiver, the
Ambassador urged powerful Planning Minister Julio De Vido to
help convince the President to support the draft, warning of
the adverse impact FATF sanctions could have on Argentina's
financial sector. In the Ambassador's presence, De Vido
immediately called the President's Legal and Technical
Secretary, Carlos Zannini, and recounted the Ambassador's

SIPDIS
arguments. Zannini said he would hold a meeting on the law
later in the day.

Draft Criminalizes Terrorism and Terrorism Financing
-------------- --------------

6. (C) The draft law, which uses Germany's legislation as a
model, amends the Argentine Penal Code to criminalize acts of
terrorism and terrorism financing (making them autonomous
crimes). It adds a new Chapter VI, titled "Illegal Terrorist
Associations and Terrorism Financing," under Title VIII
(Crimes Against Public Order) of the Penal Code. The draft
imposes prison terms of five to twenty years for taking part
in an "illegal association" with the goal of "committing
terrorist crimes." It also imposes prison terms of five to
fifteen years for financing "illegal terrorist associations."


...But Concerns Remain
--------------

7. (C) Two primary concerns have arisen during Post's
consultations on the draft law with other FATF members,
including the IMF's regional advisor on AML/CTF issues (based
in Buenos Aires). First, Title VIII of the Penal Code
defines "illegal associations" to include "Any person who is
a member of any association or gang of three or more
persons." Therefore, individual acts of terrorism are
excluded. This does not conform to FATF standards. However,
we understand German law has similar limitations, and Germany
remains a FATF member.


8. (C) Second, rather than just state that the law excludes
forms of social protest or civil disobedience, the draft
attempts to achieve this by limiting the characteristics of
illegal associations to: 1) those that support ethnic,
religious, or political hatred; 2) those organized in
international network operations; and 3) those that use
weapons of war, explosives, chemical or biological agents, or
any other method used to endanger human life. (Note: this
is an unofficial and incomplete translation. End Note). The
IMF regional advisor is unsure whether this language meets
FATF standards, and comments that FATF members will have to
address this during the February Plenary.

Draft Empowers Law Enforcement Agencies
--------------

9. (C) The draft also amends Argentina's anti-money
laundering legislation (Law 25.246 of May 2000) to grant the
Argentine Financial Intelligence Unit ("Unidad de Informacion
Financiera," or "UIF") the authority to take action to
prevent the financing of terrorism -- equal to the authority



it already possesses with regards to money laundering. It
also expands the list of predicate crimes for money
laundering to include terroism financing and the financing
of activities of illegal terrorist associations. Finally,
the draft authorizes the sanctioning of legal entities, such
as banks, foreign exchange houses, and insurance companies,
that provide financial support to illegal terrorist
associations. (Comment: Likely the most important impact of
a CTF law would be the legal support it gives to
administrative measures the Central Bank and UIF have already
imposed on financial entities. Without a law, banks are
reluctant to comply with the Central Bank's mandated
terrorism finance reporting and investigation requirements,
for fear of being sued. End Comment).

Comment
--------------

10. (C) The Embassy agrees with the IMF and others that the
GoA could have chosen a stronger law -- particularly the IMF
and U.S. Treasury-supported law that the Central Bank
originally proposed, which was based on French law. However,
the GoA clearly chose the law that is most in accordance with
the existing Penal Code and has the best chance of getting
through Congress. Our GoA interlocutors, including National
Coordinator Marteau, express confidence that FATF will accept
this draft. No doubt Marteau will highlight its similarity
to German legislation during the GoA presentation at the
February Plenary.


11. (C) Regardless of its apparent shortcomings, passage of
this law would significantly strengthen the existing legal,
regulatory, and law enforcement framework. It also sends a
message to society that the GoA assigns importance to
fighting terrorism and terrorism financing. It remains to be
seen whether the President will override influential interest
groups during an election year and actively push for
Congressional passage of the law. However, the fact that he
submitted the draft while Congress was still in session,
rather than during the January-February recess (as many local
analysts expected),signals that the President is taking this
seriously. Congressional passage of this legislation will
remain a Post priority over the coming months. End Comment.
WAYNE