NEPAL: TERRORIST FINANCE: USG CONCERN OVER ILLICIT

C O N F I D E N T I A L KATHMANDU 000465 SIPDIS SIPDIS E.O. 12958: DECL: 03/02/2017 TAGS: PGOV EFIN ETTC KTFN PTER PREL NP SUBJECT: NEPAL: TERRORIST FINANCE: USG CONCERN OVER ILLICIT CASH COURIERS DELIVERED REF: STATE 16120 Classified By: Ambassador James F. Moriarty. Reasons 1.4 (b/d). Talking Points Delivered -------------- ¶1. (C) Post delivered reftel talking points to Shanker Bairagi, Under Secretary for Europe and the Americas in the Ministry of Foreign Affairs, stressing concern over illicit cash carriers given Nepal's substantial reliance on non-traditional forms of money transfer. Bairagi said he would share the points with his superiors at the earliest possible moment. Nepal Aware and Working on the Problem -------------- ¶2. (SBU) Partly in response to previous demarches by the USG, Nepal has instituted a number of safeguards into the banking system to protect against fraud or criminal activity. The Financial Institutions Act of 2006 calls on all commercial banks to carefully check their customers' business profiles and the transaction for which foreign currency is being transferred. Undeclared currency is a violation of Nepali law, and customs officials regularly check arriving and departing travelers at Kathmandu's international airport. Due to the porous Indian border, Nepal also combats fraudulent Indian currency and the smuggling of Indian currency. Nepal's Rastra Bank has the authority to freeze accounts and seize assets related to criminal investigations. However, the Government of Nepal's (GON) ability to identify and trace assets is hindered by the lack of a centralized and computerized information sharing system. MORIARTY