PAKISTAN'S ACTION ON DISRUPTING EXTERNAL FINANCING TO THE TALIBAN

S E C R E T SECTION 01 OF 02 ISLAMABAD 002113



SIPDIS



NOFORN

SIPDIS



STATE FOR S/CT PHILL, EB/ESC/TFS LLAMBERT AND DNELSON

TREASURY FOR PDEGARABEDIAN AND ASHARMA

JUSTICE FOR LSAMUEL AND RSTAPLETON



E.O. 12958: DECL: 05/08/2017

TAGS: PTER, KTFN, EFIN, KPAO, PK

SUBJECT: PAKISTAN'S ACTION ON DISRUPTING EXTERNAL FINANCING

TO THE TALIBAN



REF: STATE 54915



Classified By: Charge d'Affairs Peter W. Bodde for Reasons 1.4(b) and (

d)



1. (S) Summary: Post has been actively engaged with the

government of Pakistan on combating financing of the Taliban

and Al Qaeda. Members of the Country Team have taken an

inter-agency approach to informing and assisting the GOP at

all levels on ways to disrupt the Taliban's financial

networks. Intelligence has been shared, advice on

legislation given, and high-level visitors encouraged to

raise the issue in their meetings. There have been some

notable successes, and Post continues to work to encourage

the GOP to do more. End Summary



PRESSING THE GOP TO DO MORE

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2. (S) Post frequently discusses the need for action against

Pakistan-based sources of Taliban financing and financial

transfer at the highest levels of Pakistan's government,

particularly with the President and Prime Minister. This

includes not only utilizing embassy personnel, but also

high-level visitors.



MAKING PROGRESS ON THE MONEY LAUNDERING BILL

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3. (C) Post is seeing movement in the progress of the

anti-money laundering bill. The Standing Committee on

Finance and Revenue of the National Assembly has thoroughly

reviewed the bill, recommended amendments, and returned it to

the Ministry of Finance. Post will work with Ministry of

Finance to ensure the legislation meets international

standards, and it should be sent back to the National

Assembly for final passage in early June. (Note: State Bank

of Pakistan Head Dr. Shamshad Akhtar stated a similar time

frame in discussions with A/S Sullivan at their April 13

meeting in Washington. End Note)



ENCOURAGING INTERNATIONAL BEST PRACTICES

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4. (SBU) Pakistan has already passed legislation regulating

hawalas. In essence, hawalas no longer exist in Pakistan as

they have been forced to register their businesses and are

now considered currency exchange centers. As a result, more

money from remittances abroad is flowing through the

regulated banking system. In addition, Post is working with

the Ministry of Social Welfare to help craft legislation

which would require charities to register under one uniform

act (Note: Currently, charities may register under any one of

three ordinances, some dating back to the mid-nineteenth

century. End Note) Under this proposed legislation, charities

would be required to disclose the names of all their

principals, in addition to sources of funding and how that

funding is being spent.



PROVIDING TRAINING

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5. (SBU) Post's Legal Attache is working with the Ministry of

Interior and Federal Investigation Agency on developing

investigative training and an intelligence center to focus on

counter-terrorism measures that would develop the capacity to

identify and disrupt related money-laundering activities.

The U.S. Department of Justice will be providing training for

public prosecutors in Pakistan on financial crimes, including

forfeiture of assets in prosecutions in the special courts.

Once a money-laundering bill is passed, U.S. Department of

Justice will develop and present money laundering prosecution

training. This month, U.S. Department of Justice is

sponsoring the attendance of a Pakistani delegation at a

regional terrorism financing conference in Kuala Lumpur.





ISLAMABAD 00002113 002 OF 002





MONITORING AL RASHID TRUST

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6. (C) On April 18, the GOP raided the offices of Al Akhtar

Trust and Al Rashid Trust, seized assets and sealed the

offices. No arrests were made. (Note: The raids were

conducted on a Sunday when there was little chance of the

offices being occupied. End Note). Al Rashid Trust has since

petitioned the Sindh High Court to overturn the closures.

Sindh High Court did grant an interim order allowing Al

Rashid Trust to remove perishable items from their warehouses

in order to distribute them to the earthquake-affected areas;

however, they cannot distribute the goods themselves and must

use the Pakistan Earthquake Relief and Reconstruction Agency

or another charity. Al Rashid Trust told the press they were

considering opening another charity using a different name in

order to avoid problems like this in the future. Post has

scheduled meetings to discuss the situation with the Ministry

of Finance and the Ministry of Social Welfare, and will be

closely following these events.



SHARING INTELLIGENCE

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7. (S/NF) Post, through aggressive sharing of information,

has enabled the government of Pakistan to target the Taliban

in an organized and effective manner. Since January 2006,

Pakistan has arrested over 1400 Afghan nationals connected to

the Taliban, including seven on the list President Karzai

passed to President Musharraf in February. Pakistan has

repatriated over 750 of them to Afghanistan. Since mid-2006,

over 300 Taliban personnel have been detained in Quetta

alone, including senior Taliban leader Mullah Obaidullah, who

was captured in February 2007. Post continues to work with

the security services of both Pakistan and Afghanistan to

jointly target Taliban on both sides of the border, as well

as encouraging increased bilateral information sharing

between the two security services. In addition, Post is

working with coalition partners inside Pakistan to maximize

their information sharing with the government of Pakistan.

These efforts have resulted in substantial progress being

made against the Taliban target.



8. (S/NF) As a way forward, Post is pursuing two separate

strategies, one for targeting Taliban located in the

Federally Administered Tribal Areas of Pakistan and one for

those in the settled areas of the country such as Quetta and

Peshawar. Post has developed a three-pronged approach in the

Federally Administered Tribal Areas which involves increasing

the counter-insurgency and counter-terrorism capabilities of

Pakistan's military and paramilitary forces, especially the

Frontier Corps, providing development aid to the Federally

Administered Tribal Areas, and enabling continued and

increased security service operations against the Taliban.



9. (S/NF) Post plans to support security and law enforcement

services by helping to enhance their counter intelligence

capabilities and by providing appropriate development

assistance. As part of both strategies, Post plans to

continue its engagement and information sharing with the GOP

and coalition partners at all levels in order to ensure

sustained and aggressive efforts against the Taliban

throughout Pakistan.



COMMENT

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10. (S) Post works closely with all levels of the GOP in

order to disrupt funding and material support to the Taliban.

In general, the GOP has been receptive and appreciative of

our efforts. Post will continue to engage in the areas of

money laundering and the misuse of charities.

BODDE