SECOND BLUE LANTERN RESPONSE ON PRE-LICENSE

UNCLAS KUALA LUMPUR 000740

SIPDIS

PM/DTCC - BLUE LANTERN COORDINATOR

E.O. 12958: N/A
TAGS: ETTC KOMC MY
SUBJECT: SECOND BLUE LANTERN RESPONSE ON PRE-LICENSE
END-USE CHECK ON APPLICATION 050111997

REF: A. SECSTATE 74676

B. KUALA LUMPUR 502

C. SECSTATE 41077


1. Pursuant to reftel A inquiry, Econoff in early and
mid-August 2008 contacted the Malaysian Ministry of Home
Affairs (formerly Ministry of Internal Security) and the
Malaysian company "Anafield Sdn Bhd". By 20 August, both had
responded to post inquiries into Anafield's proposed purchase
of 270 sets of night vision equipment and 100 sets of night
vision front sights. Post was pleased with the responses
provided, and recommends approval of the sale. Post did not
conduct a site visit to Anafield since the proposed USML
items would not be stored at any Anafield office or facility.
Instead the items are to be controlled and stored by the
Royal Malaysian Police (RMP).


2. Ministry of Home Affairs: A member within the ministry,
Ms. ((Marhizah)) Abdul Razak, responded to post's inquiries.
She verified the proposed order by Anafield and sounded
familiar with the details.

A) Are you (Home Affairs) familiar with Anafield? Yes, the
Ministry is familiar with Anafield and, according to the
Ministry, Anafield has a solid reputation.


B) Did you order from Anafield the exact type and quantity
of items listed on this application? Yes, the Ministry
ordered the exact amount of night vision monoculars,
binoculars, and front sights as listed on the application.
They are for use with the RMP, and only for the RMP. The
items will not/not be re-sold, re-exported, or issued to any
other government ministry. Home Affairs has issued the
proposed sale a Malaysian contract number: KKDN/POL/PT/1/2008.


C) Is Anafield an official supplier/contractor for the
Malaysian government? Does the Malaysian government have any
other contracts with the company? Yes, Anafield is an
official supplier/contractor for the Malaysian government.
Yes, there is another deal with Anafield awaiting approval
(Bushmaster carbines, submachine guns, rifles, and sights).
The company also procures security-related equipment from
other international firms, such as "Law Enforcement
International" (St. Albans, Herts AL4 OWA, U.K.),"MSA"
(Pittsburgh, PA, U.S.A),"Laser Shot Inc." (Stafford, TX,
U.S.A),"Carl Walther GmbH" (Ulm, Germany),and "Safariland"
(Ontario, CA, U.S.A).



3. Anafield: After a sluggish start in early August to post
attempts at re-contact, Anafield realized that the
aforementioned deal could be in jeopardy, and via telephone
and fax provided the information requested on 13 August. The
managing director of Anafield wrote that he welcomed
re-contact in the event of new questions/problems.


A. Does the company have proper supporting documentation,
including purchase orders from the Malaysian government, for
this proposed transaction? Response: Yes, the company said
that it has the proper supporting documentation, which is in
the form of a Letter of Award issued by the Ministry of Home
Affairs. Anafield said that Home Affairs will only issue the
purchase order once U.S. State Department approves the export
as a valid purchase. A Malaysian government purchase order
will only be valid for three months, so Home Affairs will not
issue it until the USG approves the sale and shipment.
Anafield said that, under Malaysian law, it cannot bring the
shipment into Malaysian without a valid purchase order, which
must be shown to Malaysian Customs prior to the entry of the
shipment into the country. The company said that it ordered
150 sets of ATN NVM-14-31 night vision monoculars, 120 sets
of ATN Nightshadow-31 night vision binoculars, and 100 units
of ATN PS22-31 night vision front sights. Anafield said that
its primary contact at the U.S. company (American
Technologies Network Corp., in San Francisco) is Mr. Mark
((Tarakanov)) (email: mtarakanov@atncorp.com).


B) Will the company be handling or storing the items listed
on the application? If so, does it have secure facilities
and proper accounting and security procedures for handling
these sensitive USML items? Response: Anafield said that it
will receive the items only when the items arrive at
Malaysian Customs, but would immediately turn the entire

shipment over to the RMP (since RMP is the final end-user of
the items). Anafield said that the items, when not in use,
would be stored at RMP's Central Warehouse, which is a secure
sight and not/not open to the public or to visits by non-RMP
personnel. The warehouse is located at Polis Diraja
Malaysia, Jabatan Logistik (SMS),Kompleks SMS PDRM,
Persiaran Usahawan, Seksyen U1, 40150 Shah Alam, Selangor,
Malaysia. Anafield specifically said that it will clear the
items at Malaysian Customs with officers from RMP also
present, as firearms and associated equipment (such as NGV's)
are controlled items in Malaysia. Once the items clear
Customs, the shipment will go directly to the Central
Warehouse, and RMP is responsible for control.


C) When was the company established and who are its
principals? Response: The company was established on 11
April 2002. Its principal officers are Director ((Mohamed
Noor)) bin Yusoff (male, born 04 Sept 1952); Tan Sri ((Abdul
Rahim)) bin Mohamed Noor (male, born 06 June 1943); Datuk
((Abdullah)) bin Jonid (male, born 10 May 1938); and
((Halina)) H. Ismail (female, born 20 June 1975).


D) What is the nature of its business -- what type of items
does it handle, and does it serve as a broker? Response:
Anafield specializes procuring in police and military
equipment -- such as marketing simulators, firearms, gas
masks, optics, and holsters -- for the Malaysian government.
The company said that it does not/not serve as a broker for
sales to other countries. Anafield also provided information
on a recent request to purchase U.S.-manufactured Bushmaster
carbines, and had previously (NFI) sold Bushmaster carbines
in small quantities to the Royal Malaysian Air Force Special
Regiment and the RMP.


E) What types of organizations are among its typical
customers, and where are the customers located? Response:
Anafield said that its usual Malaysian government customers
are the Ministry of Defense and the Ministry of Home Affairs,
particularly for the RMP. Both ministries are headquartered
in the new, large government suburb of PutraJaya, located
southwest of Kuala Lumpur. Both ministries have sub-offices
scattered throughout Malaysia.


F) Does the company understand the restrictions on United
States Munitions List (USML) items, especially the
prohibition against unauthorized re-transfers and re-exports?
Response: The company said that it clearly understands the
restrictions placed upon USML items. The company said this
requirement is why it completed the DSP83 and the End User
Statement forms. The company said that it will not/not
re-export the items.


G) What is post's assessment of whether the company appears
to be a reliable recipient of USML items. Response: Post's
assessment of Anafield is that it is a professional, but
secretive, procurement company for Malaysian ministries that
require sensitive equipment, such as firearms and associated
equipment. Anafield appears to be a company staffed with
employees that are either former members of Malaysian
government organizations such as the Ministry of Defense or
Ministry of Home Affairs (aka Internal Security),and that
such employees are usually more motivated and opsec minded
than the average Malaysian citizen. In sum, Anafield appears
to be a reliable recipient of USML items.



4. Post assessment is that Anafield and the Ministry of Home
Affairs were more cooperative in August 2008 than previously
in June 2008, although Anafield and Home Affairs maintain a
more secretive nature than most normal Malaysian firms and
government ministries. Post believes that this is not/not
anything nefarious. Rather, Anafield's hesitancy to complete
transparency is due to the nature of its work (procuring
firearms/sensitive equipment for the government),and
especially to almost-certain strong links to the RMP Special
Branch, which is Malaysia's internal security intelligence
service. Ties between Special Branch and USG are good/very
good in some areas, but average/poor in others, and therefore
Anafield is wary of USG contact. Regardless, Anafield and the
Ministry of Home Affairs answered all of the questions, and
therefore we recommend completion of the proposed sale.

KEITH