Educating Nicaraguans on FIU Operations

UNCLAS SECTION 01 OF 02 MANAGUA 002621 SIPDIS SENSITIVE SIPDIS STATE FOR WHA/CEN, WHA/EPSC, INL/LP, S/CT AND EEB/IFD BOGOTA FOR FGROENE GUATEMALA FOR NAS TREASURY FOR SARA GRAY AND FINCEN TREASURY PASS TO IRS-CI/NFULLER, AALDECOA, TMAHONEY JUSTICE FOR OIA, AFMLS, NDDS JUSTICE PASS TO OPDAT CDELUIGI USDOC FOR 4332/ITA/MAC/WH/MSIEGELMAN 3134/ITA/USFCS/OIO/WH/MKESHISHIAN/BARTHUR E.O. 12958: N/A TAGS: EFIN PTER ECON PGOV SNAR NU SUBJECT: Educating Nicaraguans on FIU Operations REF: MANAGUA 2351 (NOTAL) ¶1. (SBU) Summary: On November 29, Embassy Managua held three separate seminars to educate members of the media, GON, and the private sector about the role and operation of a Financial Intelligence Unit (FIU) to dispel fears that the FIU would become another law enforcement tool which the GON could deploy against political enemies. Our immediate objective was to explain the responsibilities of an FIU, how it operates, and how it interacts with the other FIUs. Eighteen reporters from various media outlets attended the seminar for press and spent almost two hours asking questions. Separate seminars for the GON and private sector representatives resulted in equally intense Q&A sessions. The event helped us to get out clear and accurate information on FIU operations and the institution's role in Nicaragua's financial security. Depending on the progress of the bill to create an FIU in the National Assembly, we may consider a follow-up event in February ¶2008. End Summary. Overview of the Seminars -------------- ¶2. (U) Since Embassy Managua's last public event highlighting the need for Nicaragua to have an FIU (Reftel),public debate has centered on a growing fear that an FIU would overturn banking secrecy laws and become another law enforcement tool the GON could deploy against political enemies. Several Nicaraguan public figures have called the creation of an FIU the beginning of a "police state." To allay fears and influence the public discourse of key Nicaraguan actors on the issue, on November 29 Embassy Managua held three separate seminars for public and private sector representatives and the press explaining the responsibilities of an FIU, how FIUs operate, and how FIUs interact with their international counterparts. Separate events allowed participants to feel that they were among colleagues and therefore free to discuss their concerns. ¶4. (U) Speakers at the event were Mauricio Pastora, Regional Advisor to Latin America in FINCEN; Willy Zapata, Guatemalan Superintendent of Banks and former president of Caribbean Financial Action Task Force (CFATF); Humberto Arbulu Neira, IMF Resident Representative; and Ricardo Velez, creator and former President of Guatemala's FIU and anti-money laundering consultant. Experts on hand to respond to questions were Lourdes Galindo, Guatemala NAS Legal Advisor and one of the drafters of Guatemala's FIU law; Victor Urcuyo, Nicaraguan Superintendent of Banks; Ramon Tobar, Guatemalan FIU Director; and, Heynar Martinez, Anti-Money Laundering Director at Nicaragua's Superintendency of Banks. ¶5. (U) Speakers focused on the role of an FIU in improving financial security in a country, clarifying what an FIU looked at and investigated, how it interacted with the international FIU community, and how it conducted operations within the confines of existing banking secrecy practices. Velez' presentation went into extensive detail on the day-to-day operations of an FIU and its interaction with other FIUs around the world. Zapata used colloquial stories to explain the costs to ordinary Nicaraguans of not having an FIU. Post had provided the speakers with Nicaragua's current bill creating an FIU, as well as proposed amendments from the Superintendency of Banks, so they were able to show how the proposed Nicaraguan FIU met these international norms. The Media -------------- ¶6. (U) An essential part of educating the Nicaraguan public on the importance of an FIU is educating the media. Managua PAS invited over 20 members from Nicaragua's broadcast and print media to a special session with the speakers. Over 18 reporters attended, including four television crews. The speakers delivered their presentations, answered questions and conducted extensive television interviews for almost two hours. We also shared via e-mail Velez' power point presentation which laid out step-by-step how FIUs operate. As a result of this effort, Nicaragua's two major newspapers issued three balanced and informative pieces that dispelled quite a few of the myths surrounding FIUs. Television coverage included evening news spots on one cable and two national stations. At least four radio stations with national coverage discussed the issue of FIUs in afternoon and evening news programs. The Government -------------- ¶7. (SBU) A Supreme Court Justice headed thhcQQ5Nx~, National Anti-Drug Commission, and Director General for Taxes. The Economic Counselor from the German Embassy, representing the G8 presidency, made a closing statement highlighting the high priority G8 countries give to Nicaragua having an FIU. ¶8. (U) Questions from the floor focused on FIU operations and international standards. Many of the guests continued to ask the speakers and experts questions during the coffee break and in the hallway while the next event was being set up. We also shared via e-mail Velez' power point presentation to all who attended. The Private Sector -------------- ¶9. (SBU) The Ambassador opened the meeting with the private sector which included representatives from the American Chamber of Commerce, the Chamber of Industry, and the Association of Private Banks. During an extensive 90-minute question and answer period, attendees focused on protecting private financial information from political scrutiny, the responsibilities of banks, and how to guarantee FIU independence. Comment -------------- ¶10. (SBU) The event allowed us to get out clear and accurate information on the role and operation of FIUs in Nicaragua. We had wanted National Assembly Deputies and their staff to attend, but they were unable to because of a scheduling conflict. The Superintendent of Banks believes they avoided the event because the FIU issue had become a political "hot potato." Depending on the progress of the bill creating an FIU, currently in the National Assembly Economic Commission, Embassy Managua may want to invite Mr. Zapata and Mr. Velez to speak just to National Assembly Deputies in February 2008. ¶11. (U) Post would like to extend a special thanks to NAS Guatemala for their help and support for this event. TRIVELLI