ITALY: WORKING TO IMPLEMENT FATF RECOMMENDATIONS

C O N F I D E N T I A L ROME 002296

SIPDIS

SIPDIS

PLEASE PASS TO TREASURY/TFFC AND ISN/CPI

E.O. 12958: DECL: 11/05/2017
TAGS: PARM PREL MNUC ECON
SUBJECT: ITALY: WORKING TO IMPLEMENT FATF RECOMMENDATIONS

REF: A. SECSTATE 148605

B. SECSTATE 149648

C. ROME 2032

D. ROME DAILY REPORT (10/26/2007)

Classified By: Econ Counselor William R. Meara for Reasons
1.4 (b) and (d).


1. (C) Summary: At the Financial Action Task Force (FATF)
plenary in October, Italian officials helped build consensus
around the FATF public statement of concern regarding
deficiencies in Iran's anti-money laundering and
counter-terrorist financing regime (ref A). Prior to
receiving reftel B demarche requesting engagement with GOI
officials on FATF, Econoff had already spoken with Finance
and Foreign Affairs contacts to track progress on FATF
implementation. Italy's Financial Security Committee is
preparing an advisory based on the FATF plenary outcome. Our
MFA contact underscored that all accounts linked to Iran are
already under heavy scrutiny. End summary.


2. (C) After Italy hosted a special FATF Working Group
meeting on Terrorist Financing and Money Laundering in
September (reftel C) post has been following Italy's
engagement at FATF meetings carefully. Econoff met with
Roberto Ciciani head of the Financial Crimes Prevention Unit
at the Ministry of Finance on October 25 to follow-up on the
October meetings. Ciciani characterized the meetings as a
success and told Econoff that he had proposed compromise
language that assisted FATF members in reaching consensus on
the public statement of concern (ref A). (Note: This fact
was confirmed by U.S. colleagues who attended the meetings.)
Ciciani said that the Italian Government supported FATF
actions against Iran because FATF followed a transparent,
step-by-step approach that provided specific guidelines on
activities that will be restricted. Ciciani added that upon
his return from Paris, his office tasked the Financial
Security Committee (FSC) to prepare the guidelines on
activity based financial prohibitions based on UNSCR 1737.
He added that many of measures called for at the FATF
meetings had already been included in advisories issued by
the FSC. Ciciani stated that the GOI was taking every
necessary step to counter illicit use of the Italian
financial system by Iranian entities.


3. (C) Econoff also discussed FATF outcomes with MFA
Counterterrorism Finance Officer Stefania Francello on
October 26. She confirmed that the MFA was working with the
FSC on a new advisory notice. Francello highlighted that all
financial transactions involving Iran are already carefully
scrutinized by banking regulators (ref D).
SPOGLI