USG PROVIDES ANTI-MONEY LAUNDERING, C-T ASSISTANCE TO

UNCLAS NICOSIA 000712 SIPDIS Department for EUR/SE, INL. Treasury for IA Larry McDonald, IET Michael Ruffner, IET Carlos Correa, and the Office of Terrorist Financing and Financial Crimes. E.O. 12958: N/A TAGS: ECON EFIN KCRM ETER CY SUBJECT: USG PROVIDES ANTI-MONEY LAUNDERING, C-T ASSISTANCE TO TURKISH CYPRIOTS ¶1. (U) The following is a Department of Treasury-drafted message transmitted from Embassy Nicosia. ¶2. (SBU) Responding to a July 2008 Embassy Nicosia request, two advisors from the U.S. Department of Treasury's Office of Technical Assistance (OTA) Financial Enforcement Team visited Nicosia August 25-29, primarily to provide Financial Investigative Techniques training to "TRNC investigators, prosecutors and Financial Information Unit (FIU) staff." Funding for the training came both from the Embassy and from OTA. ¶3. (SBU) Topics covered during the training were: Money Laundering, Terrorist Financing, Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) laws of Cambodia (used as examples),FIUs, Investigative Task Forces, Corruption, Sources of Financial Information, Forensic Accounting, Evidence, International Evidence, Money Laundering Investigative Techniques, Asset Forfeiture, Methods of Proof, and Investigative Reports. The course included a week-long practical exercise that was integrated with the substantive lectures. ¶4. (SBU) Eighteen Turkish Cypriot authorities attended the course, hailing from the "TRNC police", "prosecutor's office," and "FIU." Extremely positive feedback was received from participants regarding the course content and the applicability of the techniques to combat money laundering and terrorist financing in northern Cyprus. ¶5. (SBU) The OTA trainers also held a special session for Turkish Cypriot "judges" on AML/CFT which primarily focused on Asset Forfeiture and evidence. Members of the "TRNC judiciary" are aware of several gaps in current "legislation" and they believe there is merit to implementing a non-conviction based forfeiture (Civil forfeiture) provision in a revised "law." ¶6. (SBU) During the week-long training the team and Embassy officers met with the "National AML Board" about training progress and objectives. The "Board" expressed the serious need for, and an enthusiastic desire to receive future technical assistance from OTA. ¶7. (SBU) The "TRNC"/northern Cyprus is identified as having significant weakness in its AML/CFT regime by the International Cooperation Review Group (ICRG) of the Financial Action Task Force (FATF). The "Board" asked the OTA team to report its progress to FATF. The OTA team made it clear to the "Board" that OTA, which is part of the Office of International Affairs of the Treasury Department, has a role to provide technical assistance to countries, but not an AML/CFT Policy role. Rather, the Office of Terrorist Financing and Financial Crimes (TFFC) in Treasury is the point of contact for FATF relations and US AML/CFT policy. ¶8. (SBU) Near-term "next steps" planned by OTA include continuing to engage with the Mission and the European Commission regarding FATF ICRG areas of concern in northern Cyprus. This is based on the lack of funding in OTA to pursue a more active program.