KAZAKHSTAN: CHIEF OF FINANCIAL INTELLIGENCE UNIT LAYS OUT

UNCLAS SECTION 01 OF 02 ASTANA 002119 SENSITIVE SIPDIS STATE FOR INL/AAE, SCA/CEN, SCA/RA TAGS: PGOV PREL PINR EFIN SNAR KCRM KZ SUBJECT: KAZAKHSTAN: CHIEF OF FINANCIAL INTELLIGENCE UNIT LAYS OUT HIS VISION FOR COOPERATION ¶1. (U) Sensitive but unclassified. Not for public Internet. ¶2. (U) SUMMARY: On October 1, the Minister of Finance appointed Mussiraly Utebayev to head the Committee on Financial Monitoring, which is Kazakhstan's Financial Intelligence Unit (FIU). Representatives of the Embassy's Office of International Narcotics and Law Enforcement (INL) met with him briefly during an anti-money laundering coordination meeting on October 8 and had a longer meeting with him on October 15 to discuss the needs of his committee and future cooperation with the United States. END SUMMARY. HITTING THE GROUND RUNNING ¶3. (SBU) One of Utebayev's first multilateral meetings was with the anti-money laundering coordination group chaired by the World Bank. During that meeting, Utebayev laid out his goals and stated that he was beginning to staff his office and working with the Parliament to get anti-money laundering legislation passed. He assured the group that he was not going to wait for passage before creating a system for reporting suspicious financial transactions and fully standing up his Committee. The World Bank advised Utebayev that the draft law still did not meet international standards and said that Kazakhstan could face serious repercussions if it was not passed soon. ¶4. (SBU) INL representatives met with Utebayev on October 15 to discuss assistance to the Committee. Utebayev said he welcomes cooperation with the United States and is deeply interested in learning more about the operations of the U.S. FIU, FinCEN (the Financial Crimes Enforcement Network). INL agreed to arrange and fund a study tour for Utebayev and his staff and will discuss the possibility of an assessment trip by officials from FinCEN. Utebayev also reiterated a request made at the coordination group meeting for technical and analytical training. Utebayev specifically asked for Committee staff to be included in training offered to the financial police and customs service. Utebayev expressed an interest in holding training programs at the Academy of State Service in Astana. BACKGROUND OF THE FIU ¶5. (U) The Committee on Financial Monitoring was established by an April 24, 2008 decree. After lengthy debates about the appropriate ministry to oversee the Committee, it was placed under the Ministry of Finance. Its charter, staffing pattern, and structure are to be determined in the near future. In accordance with provisions of the draft money-laundering and terrorist-financing law, the Committee will be responsible for the collection and analysis of data on transactions subject to financial monitoring and transmission of information on potentially illegal transactions to law enforcement agencies. BIO NOTES ¶6. (U) Mussiraly Utebayev was appointed Chairman of the newly-created Committee on Financial Monitoring on October 1 by Minister of Finance Zhamishev. Utebayev was born in 1950 in South Kazakhstan oblast and graduated from the Shymkent Pedagogical Institute in 1971. He started his career as a teacher of mathematics and later worked in a government computer center in Shymkent. In 1991, he graduated from the prestigious Academy of National Economy of the Soviet Union's Council of Ministries. (NOTE: The Academy specialized in preparing students to become senior government officials; among the graduates of the Academy are former Russian Prime Minister Viktor Chernomyrdin and former Ukrainian Prime Minister Leonid Kuchma. END NOTE.) In 1991, Utebayev became Deputy Regional Administrator of Shymkent and remained in the position following the independence of Kazakhstan. From 1994 to 2002, he held several economic-related jobs in the government, including as an economic policy advisor to President ASTANA 00002119 002 OF 002 Nazarbayev and Chairman of the National Budget Committee. In 2002, he was elected to the Senate, where he remained until his current appointment. In 2007, he was one of six Kazkahstani Senators to receive a medal from UNICEF in recognition of legislative activities related to children's rights and maternity. Senate Chairman Tokayev honored Utebayev before he left the Senate and said that Utebayev may be considered one of the founders of Kazakhstan's financial system. ¶7. (SBU) COMMENT: Utebayev appears to be committed to the creation of an FIU that meets international standards. His experience and reputation in the Senate should be invaluable in getting the draft anti-money laundering law adopted and getting sufficient funding for his Committee. We are pleased not only that the FIU was created within the Ministry of Finance, but also that such an experienced official was appointed to be its chairman. Not only does he have a solid economic background, but he also has the necessary experience working with international organizations and other governments. During the INL meeting, Utebayev mentioned previous travel to the United States during which he studied tax institutions. He seemed pleased with his experience in the United States and looks forward to continued cooperation. END COMMENT. HOAGLAND