ESTONIA'S STANCE ON ILLEGAL CASH COURIERS

UNCLAS TALLINN 000121 SIPDIS DEPT FOR EUR/NB AND EEB/ESC/TFS Katherine Leahy and Leanne Cannon S/CT Patty Hill, Anne Galer and Gary Novis SIPDIS SENSITIVE E.O. 12958: N/A TAGS: EFIN ETTC KTFN LE PREL PTER EN SUBJECT: ESTONIA'S STANCE ON ILLEGAL CASH COURIERS REF: STATE 16120 ¶1. (U) Econoff delivered reftel points to Jaap Ora, Director of the 1st Division of the MFA's Policy Planning Department - which is responsible for coordinating Terrorist Financing issues for the GOE. ¶2. (U) Estonia's main legal instrument in the fight against terrorist financing and illegal cash transactions is the January 2004 Money Laundering and Terrorist Financing Prevention Act, as amended. According to the Act, credit and financial institutions are required to identify all individuals or representatives who carry out cash transactions above EEK 100,000 (approximately $8,600) or non-cash transactions above EEK 200,000 (approximately $17,100). An amendment to the MLTFPA that came into force in March 2005 required identification of all clients who use the services of any financial institution for the first time, while the method of identification should enable re- identification, Failure to comply with the identification requirement brings along criminal liabilities. ¶3. (U) Beginning June 15, 2007, control over cash entering Estonia from outside the EU will be based on the adoption of EU Regulation (EC) No 1889/2005 of October 26, 2005. When this regulation enters into force, fines will be assessed either for failing to declare, or illegally declaring cash. At the present time, the Estonian Tax and Customs Board (TCB) controls the external borders of the EU at the border with Russia and at the Tallinn Airport. All main border crossing points are controlled 24 hours a day. According to Mr. Ora at MFA, TCB staff at the border crossing points "...have been trained to uncover illegal items from vehicles, goods, passengers and their luggage." The TCB also employs a computer-based operational risk analysis system, assessing passengers crossing the borders. The border crossing points are supplied with detection technology such as x-ray machines, endoscopes and video surveillance to uncover illegal items. TCB expects an automatic number plate detection system to come on line in the near future. ¶4. (U) Additionally, starting in May 2007, all private banks in Estonia will voluntarily adopt a security measure which mandates the use of an electronic ID card, or a PIN-password calculator, for wire transfers of cash cumulatively totaling over EEK 10,000 (USD 820) per day. Currently, each bank can set its own limits. Although Estonia's Citizenship and Immigration Board has issued over a million national ID cards, estimates are that only about 40,000 people in the country regularly use them for electronic transactions. The rest use them only for identification and travel within the EU. ¶5. (U) The main agencies responsible for monitoring terrorist finance issues are the Financial Intelligence Unit of the Central Criminal Police, and the Customs Control Department of the Tax and Customs Board. Additionally, the Security Police Board is involved in terrorism-related matters. GOLDSTEIN