SENEGAL BALKS AT PASSING TERRORISM FINANCING LAW

S E C R E T SECTION 01 OF 03 DAKAR 000824 SIPDIS STATE FOR AF/RSA, AF/EPS, AF/W TREASURY FOR RHALL, DPETERS USUN VIENNA FOR FINCIN FBI FOR OIO STATE PLEASE PASS MCC E.O. 12958: DECL: 07/15/2028 TAGS: PTER KTFN ECON PGOV PREL KCOR SG SUBJECT: SENEGAL BALKS AT PASSING TERRORISM FINANCING LAW REF: TREASURY 191745Z JUN 08 (NOTAL) DAKAR 00000824 001.2 OF 003 Classified By: CHARGE D'AFFAIRES, A.I. JAY T. SMITH, FOR REASON 1.4 (B) AND (D). ¶1. (S) SUMMARY: The UEMOA Council of Ministers has approved a uniform law (directive) by the regional Central Bank for countering the financing of terrorism (CFT). The law has been forwarded to Senegal and other member states for ratification by country parliaments. According to Senegal's Financial Intelligence Unit, the CENTIF, President Wade has decided to not support the law, and has advised his Council of Ministers that he will not authorize the forwarding of the law to the National Assembly, a necessary step in the ratification process. According to the CENTIF, President Wade may be concerned that ratification of the law may have the unintended side-effect of exposing corruption within his administration. Ministry of Justice Officials are planning to conduct their own "review" of the uniform law, apparently as a stalling tactic, though they have no legal basis to do so under the UEMOA treaty. END SUMMARY. CURRENT STATUS OF TERRORIST FINANCING LEGISLATION -------------- -------------- ¶2. (SBU) In March, the West African Economic and Monetary Union (WAEMU/UEMOA) approved new Uniform legislation for countering the financing of terrorism (CFT),which was forwarded to Senegal and other member states for ratification by country parliaments. Laws governing monetary and economic policy which are passed by UEMOA are binding on all members, who are required to submit and pass implementing legislation through national legislative action. In theory, there is no latitude to amend the law for local considerations. In Senegal, the uniform CFT legislation resides at the Ministry of Justice, which is supposed to put it on President Wade's agenda for his Council of Ministers approval and then craft draft implementing legislation for the National Assembly. ¶3. (SBU) Reftel reported that the Senegalese Delegation to the May 5-9 Ninth Plenary Meeting of GIABA (ECOWAS' Intergovernmental Action Group Against Money Laundering and Terrorist Financing in West Africa) asserted that the government would use "emergency procedures" to facilitate the implementing legislation through the Cabinet and National Assembly. However, as with all significant government action in Senegal these days, the CTF legislation first must pass muster at the Presidency. FIU SEES A LACK OF POLITICAL WILL -------------- ¶4. (S) During a June 12, 2008 meeting with Legatt, Abdoulaye Kane, Director General of Senegal's Financial Intelligence Unit (FIU),the Cellule Nationale de Traitement des Informations Financiers (CENTIF),confided his concern on the lack of political will in Senegal to pass the WAEMU legislation. Kane (strictly protect) claimed that the Justice Minister recently presented the UAMOA legislation to President Wade, presumably to get approval for adding the needed implementing legislation to the Council of Ministers agenda. However, according to Kane, when the President and his close advisors reviewed the law, they balked at further action. President Wade is reported to have asked, "why do we need this?" and rejected out of hand the idea of pursuing implementing legislation. Kane told Legatt that he believes Wade's reaction was out of concern that the new legislation could expose graft and corruption within his inner circle. Kane was not/not implying any concern for terrorism-related financing or transactions tied to President Wade or his confidants. JUSTICE OFFICIAL: NEW REVIEW NEEDED -------------- ¶5. (C) While it is the Finance Minister who approved the uniform CTF law at the UEMOA Council of Ministers, in Senegal the dossier currently resides with Mr. Amadou Diallo, Director of Criminal Affairs at the Ministry of Justice. On DAKAR 00000824 002.2 OF 003 June 20, Diallo told Legatt and Economic Counselor that he was undertaking a "review" of the draft legislation to make certain it was applicable for Senegal and that it could be implemented "within the local context." Diallo admitted that Senegal historically is the first UAMOA country to pass implementing legislation as it had done recently with the UEMOA's uniform law on anti-money laundering (AML). However, Diallo claimed that Senegal had "some difficulties" in the past with "applying" UAMOA directives. It was disconcerting that Diallo also claimed Senegal was having difficulty in implementing the uniform AML law, and that he was "troubled" by the terms of reference between the CENTIF and Ministry of Justice prosecutors for enforcing these laws. ¶6. (C) Diallo explained that his office was undertaking the review of the UEMOA CTF legislation so that it could be positively promoted to the President and the Council of Ministers. However, he admitted that there was no mechanism in place to legally amend the text, and, when asked, Diallo denied that Senegal would ask the UAMOA and the regional Central Bank (BCEAO) to revise the text. Diallo claimed that as part of his review, he would like to compare the text with CTF legislation from the U.S., France, and other countries. ¶7. (C) In trying to put a positive spin on the conversation, Diallo noted that no UAMOA country had yet implemented the uniform CTF legislation, but that Senegal did have existing CTF legislation on the books from 2005, which allowed Senegal to prosecute terrorism financing should it be discovered. He admitted, however, that the existing legislation does not cover the key points of the UAMOA legislation, namely, giving necessary authority to the CENTIF for detection and intervention of suspect transactions. REGIONAL CENTRAL BANK -------------- ¶8. (SBU) EconCouns met on July 10 with Nestor Wadagni, Deputy Director for Research at the BCEAO who is responsible for researching and drafting laws, and other senior officials, including the bank's legal experts (jurists). The BCEAO officials confirmed that, while drafting the uniform CFT law, they consulted widely, including with the UNODC, GIABA, and bilateral partners; they hosted a multi-agency, multi-national workshop on the CFT laws last year, that included, they believed, the participation of U.S. Treasury; they reviewed a number of existing CFT laws; and they assured their draft's conformity with the requirements of UNSC resolutions 1373 and 1267. Therefore, there should be no question of additional review by member states. On March 10, 2008 in Lome, they held a final round of consultations with members of all UEMOA countries, where Senegal was represented by both the Minister of Finance and the CENTIF. On March 28, the text was submitted to and adopted by the UEMOA Council of Ministers, and in April the text was presented to member countries for their ratification. ¶9. (SBU) Wadagni and his colleagues further explained that under the UEMOA charter, member states had very little leeway to modify or request revisions to BCEAO directives once they have been approved by the Council of Ministers. Member states are required to move BCEAO directives to their parliaments for ratification in a timely manner, and there is no accepted mechanism for the type of review proposed by the Ministry of Justice's Diallo. They verified that to date, no member state had yet ratified the uniform CFT law, but they were hoping that the majority of countries would do so before September. Wadagni explained that they would apply "gentle pressure" on members at each quarterly Council of Ministers meeting to pass their enabling legislation. This approach apparently worked well with the uniform anti-money laundering bill, which has now been ratified by all UEMOA members except Guinea-Bissau. ¶10. (SBU) Wadagni said he believed Senegal would act quickly, since it had been one of the first countries to ratify and implement the AML directive, and is the first DAKAR 00000824 003.2 OF 003 country to establish a fully operational FIU. COMMENT -------------- ¶11. (C) Despite Diallo's attempts to rationalize the "review" of the UAMOA CFT, we believe this is no more than a stalling tactic. Unfortunately, this important legislation will not move forward until President Wade is persuaded to give the green light. Applying pressure on Wade will be difficult unless the BCEAO's leadership makes this a priority and appeals to Senegal to again prove its regional leadership (one of President Wade's main points of pride). Even then, Wade could continue stalling -- at least until other UEMOA member states start ratifying the law. We are also very concerned that President Wade is not willing to fully support the uniform AML law or give his full backing to the CENTIF. SMITH