BURMA: UPDATE ON PAVO TRADING'S FINANCIAL

S E C R E T SECTION 01 OF 04 SINGAPORE 002197 SIPDIS SIPDIS DEA RANGOON FOR CA WHALEN/ SA VELEZ DEA BANGKOK FOR RE PASQUARELLO/ARD FONG DEA HQS FOR FO/FOE, OEE/SOILES/SHIGETA TREASURY FOR MSAMARA, JSMITH, AND PDERGARABEDIAN E.O. 12958: DECL: 12/12/2017 TAGS: ETTC KCRM EFIN ECON ETRD PGOV SN BM SUBJECT: BURMA: UPDATE ON PAVO TRADING'S FINANCIAL ACTIVITIES REF: SINGAPORE 1997 SINGAPORE 00002197 001.2 OF 004 Classified By: Ambassador Patricia L. Herbold; reasons 1.4 (b) and (d) ¶1. (S) A person claiming to be the former finance manager of Pavo Trading Pte Ltd. -- a Singapore-based company with close ties to the Burmese junta -- again volunteered to meet with us on December 10 to provide additional information about the company's business activities. We first met source on October 31 (reftel). Source worked at Pavo Trading from August 2005 to March 2007. The USG designated Pavo Trading and some of its principal shareholders and management team -- including majority owner Tay Za -- under E.O. 13448 on October 19 for giving financial and material support to the Burmese regime. Htoo Trading Company Ltd. in Rangoon, also designated, is Pavo Trading's parent. We list below the documents provided (copies sent to the Department) as well as source's comments. We have not independently confirmed source's statements or information. Documents -------------- ¶2. (S) BROCHURE: "HTOO GROUP OF COMPANIES" Board of Directors: U Tay Za - Chairman and Managing Director U Thi Ha - Tay Za's elder brother U Soe Win - married to Daw Ohnmar Swe Daw Ohnmar Swe - Tay Za's younger sister and married to U Soe Win U Aung Thet Mann - son of the regime's "third senior general" (General Thura Shwe Mann). Manages the Ayer Shwe Wah Co. Ltd. on behalf of his father. The brochure lists two Ayer Shwe Wah operations: 1) Shwemyitter Bio-Fertilizer Factory and 2) Paddy Field (Ayerwaddy Division) Daw Khin Aye Thet - also a teacher of Tay Za's wife, Daw Thidar Zaw. Daw Hla Hla Yee - Chief Financial Controller Daw Khin Ma Kyu Pe - daughter of a senior military officer ¶3. (S) PAVO TRADING PAYROLL AND CPF PAYMENTS Source provided a copy Pavo Trading's payroll as of August 15, 2005, as well as records of employees' Central Provident Fund (CPF -- Singapore's mandatory pension system) deductions from 2004. Seven of the twelve employees listed on its payroll are still with the company: U Kyaw Thein, General Manager Than Myint Oo, Purchasing Manager Winnie Loke (aka Loke Lih Ping),Secretary Ma Su Yamin, Shipping and Administration (her mother is a surgeon in Rangoon who attends to Tay Za's father) Mervyn Lee, Driver (and bodyguard) Jason Sin, Purchasing and Accounts Assistant (aka Sin Kok Wee; Xin Guowei) SINGAPORE 00002197 002.2 OF 004 Zaw Nay Oo, Business Coordinator (and Tay Za's nephew) Source said that when Tay Za first established Pavo Trading in November 1999, he would transfer operating funds from the Htoo Group in Rangoon to Kyaw Thein's bank account and that all company payments were made via personal checks written by Kyaw Thein. Pavo Trading subsequently opened business accounts with Singapore-based banks. However, source said that the company appears to have reverted back to relying on employees' personal accounts to conduct business as banks close accounts linked to Pavo Trading in response to recent U.S. designations. Source speculated that Ma Su Yamin would be best positioned to assist Pavo Trading in this regard. Ma Su Yamin handles all international money transfers for the company. Source believes Tay Za is using Pavo Trading to facilitate money laundering based on the large amount of funds that flow quickly into and out of the company. Pavo Trading regularly transfers money to banks overseas, including in India, Russia, Thailand, and the United Arab Emirates (UAE) (Source could not recall specific bank names.) Total turnover reached about S$78 million (US$52 million) in 2004, and "even more" in 2005 and 2006. Source cited as an example a US$15 million wire transfer to Pavo Trading in 2005 that was wired out again in less than six months; there were no invoices or information about who remitted the funds or where the money originated. Pavo Trading also allegedly launders money by purchasing and re-selling luxury automobiles. Tay Za's associate, Than Myint Oo (see below),purchases vehicles from Dubai and then ships them to Singapore via Pavo Trading, declaring only 10 percent of their actual value. The cars are then re-shipped to Rangoon. Source recalled one particular purchase of four luxury vehicles worth US$500,000. Source said that Tay Za intends to transfer his business partner U Lu Lu (aka Kwan L-Chan) to Singapore to run his companies here. U Lu Lu recently purchased a condominium located at 150 Meyer Road in Singapore. ¶4. (S) PASSPORT PHOTOCOPY - ZAW ZAW: Nationality: Burmese DOB: October 22, 1966 Passport number: 828461 Date of Issuance: May 18, 2006 Expiry Date: May 17, 2009 One of Tay Za's business associates, Zaw Zaw runs Max Singapore, which purchases Japanese vehicles in Singapore for use by the Burmese military, according to source. ¶5. (S) PASSPORT PHOTOCOPY - THAN MYINT OO: Nationality: Burmese DOB: July 1, 1966 Passport number: 662896 Date of Issuance: May 2, 2005 Expiry Date: May 1, 2008 Source described Than Myint Oo as Tay Za's "right-hand man." He reportedly conducts business in several countries on Tay Za's behalf, including India, Russia, and the UAE (luxury automobiles),and travels frequently to Singapore where he was instrumental in setting up Pavo Trading. The Singapore government more recently denied Than Myint Oo's applications for a work permit and an employment pass. He continues to draw an off-the-books salary from Pavo Trading, according to source. ¶6. (S) PASSPORT PHOTOCOPY - U HTUN NAING: SINGAPORE 00002197 003.2 OF 004 Nationality: Burmese DOB: July 15, 1961 Passport number: 779046 Date of Issuance: January 9, 2006 Expiry Date: January 8, 2009 U Htun Naing is the son of junta leader Than Shwe, according to source. Standard Chartered Bank in Singapore closed Htun Naing's bank accounts in 2006 due to concerns about his links to the Burmese regime. He then moved his accounts to DBS Bank, although source was unsure whether DBS has subsequently stopped doing business with Htun Naing. (Note: A contact at UOB Bank reportedly told source that the Monetary Authority of Singapore has advised banks against accepting any new Burma-linked account holders following the most recent U.S. designations. End note.) ¶7. (S) PASSPORT PHOTOCOPY - FRANK WING MAN WONG: Nationality: United States DOB: November 15, 1947 Birthplace: China Passport number: Z7998728 Date of Issuance: December 29, 1999 Expiry Date: December 28, 2009 Bearer's Address in United States: 625 W. Santa Inez Ave., Hillsborough, California 94010 Bearer's Foreign Address: No. 59 (A),Shwe Hintha Street, 6 1/2 Miles, Pyay Road, Hlaing Township, Rangoon 11051 (Note: address listed is for Watana Trading. Source provided other documents that indicate Frank Wong is the company's Managing Director.) Emergency Contact Information: Vincent Wong, 87 Garden Grove Drive, Daly City 94015, (605) 994-8821 (Note: address listed is for Watana Trading Ltd. in the United States.) Frank Wong, an American citizen, lives in Rangoon. His Singapore-based company, Wongwin Corporation, sources oil and gas equipment from the United States and other countries for the IGE Company in Rangoon on Tay Za's behalf, according to source. Source provided a copy of a letter of credit payment made by IGE on May 5, 2006 for US$2,327,117.62 into Wongwin's OCBC bank account. Company details: Wongwin Corporation Pte Ltd 3 Shenton Way 24-02 Shenton House Singapore 068805 Tel: (65) 6221-2215 OCBC L/C Account: 564000800301 IGE Company Limited No. 27 B. Kabaaye Pagoda Road Bahan Township Rangoon, Burma ¶8. (S) TRANSFER PAYMENT TO FORESTRY MINISTER'S RELATIVE Source provided documentation indicating that Pavo Trading cut a check for S$100,000 (US$69,000) drawn on its OCBC bank account for U Moe Moe Kyaw, son-in-law of Burma's Forestry Minister, during his visit to Singapore in April 2005. Source suggested the money was offered as a bribe to ensure Tay Za received favorable timber concessions from the Burmese regime. Tay Za sells timber and other wood products to SINGAPORE 00002197 004.2 OF 004 Alkemal, an Indian company, through its Singapore affiliate: Alkemal Singapore Pte Ltd 3 Shenton Way 12-01A Shenton House Singapore 068805 Tel: (65) 6223-0239 Fax: (65) 6225-0678 Email: alkemal@pacific.net.sg ¶9. (S) TAY ZA - DENIAL OF APPEAL FOR PERMANENT RESIDENCE Source told us that the Singapore Immigration and Checkpoints Authority has denied Tay Za's application for permanent residence status on three separate occasions. Tay Za reportedly purchased a parcel of land at the Sentosa Cove waterfront development in Singapore for S$4.5 million (US$3.1 million) on the advice of his real estate broker, who told him that this investment would automatically entitle him to permanent residence status. ¶10. (S) ROY EASTERN WATCH PTE LTD RECEIPT Source noted that Pavo Trading purchases all of its Rolex watches from Roy Eastern, typically in pairs -- one men's and one lady's watch -- as gifts for visiting junta leaders and their spouses. This particular receipt dated June 10, 2006 is for three pairs of watches, which Roy Eastern sold to Pavo Trading for S$29,540 (US$19,693). Company details: Roy Eastern Watch Pte Ltd 01-86/87/88 and 01-74 Lucky Plaza 304 Orchard Road, Singapore 238863 Tel: (65) 6734-3139 and 6732-1935 Fax: (65) 6733-2296 Email: royeast@singnet.com.sg Business Reg. No.: 198500287D ¶11. (S) MINISTRY OF MANPOWER LETTER CONCERNING ALLEGED ILLEGAL EMPLOYMENT OF PAVO TRADING EMPLOYEES LOKE LIH PING AND U KYAW THEIN Source provided a copy of this letter originally shown to us during our October 31 meeting. ¶12. (S) ALLGO MARINE SALE AND PURCHASE AGREEMENT (BARGE) The purchase agreement, signed by Tay Za and dated November 18, 2005, closes the deal on a S$770,000 (US$513,000), 180-foot barge that is used to ship teak wood from Burma to India. Company details: Allgo Marine Pte Ltd Blk 27, Still Road South, 03-09 D'ecosia, Singapore 423936 Visit Embassy Singapore's Classified website: http://www.state.sgov.gov/p/eap/singapore/ind ex.cfm HERBOLD