PRESIDENT PREVAL SPEAKS OUT ON MONEY LAUNDERING

C O N F I D E N T I A L SECTION 01 OF 02 PORT AU PRINCE 001059 SIPDIS STATE FOR WHA/EX AND WHA/CAR INL FOR KEVIN BROWN AND ANGELIC YOUNG EEB/IFD/ODF FOR MARGUERITE SIEMER S/CRS SOUTHCOM ALSO FOR POLAD STATE PASS AID FOR LAC/CAR TREASURY FOR CARLOS CORREA INR/IAA WHA/EX PLEASE PASS USOAS E.O. 12958: DECL: 07/24/2018 TAGS: SNAR PREL PGOV ECON KCOR HA SUBJECT: PRESIDENT PREVAL SPEAKS OUT ON MONEY LAUNDERING AND CORRUPTION PORT AU PR 00001059 001.2 OF 002 Classified By: CDA Thomas C. Tighe, reasons 1.4 (b) and (d) ¶1. (C) Summary. Two recent meetings with President Preval on money laundering/corruption issues and investigations demonstrated his strong feelings about corruption within the GOH and his on-going interest in pursuing suspected corrupt officials, including former President Aristide, who allegedly robbed Haiti in the past. He pledged cooperation with the USG in moving cases involving telecommunications companies with reported ties to Aristide to prosecution in the United States. End summary. ¶2. (C) On July 22 and 23 , Charge, NAS Director and U.S. Treasury anti-money laundering experts met with President Preval at his request to discuss the latest developments in the INL-funded anti-money laundering program and on-going investigations in Haiti. Two experts from the U.S. Treasury Office of Technical Assistance (OTA) provide monthly training and technical assistance on such cases. The President has taken a strong personal interest in the program as part of his anti-corruption initiative and often meets with the team. ¶3. (C) On July 22 Preval showed particular interest in progress on investigations related to bribes and illegal payments of long distance phone fees to former President Aristide. The issue was headline news in Haiti on July 22 and widely covered in the U.S. press because last week the FCC levied a fine of 1.3 million dollars against IDT Corporation for violating communications guidelines on filings of contracts that included improper payments to foreign officials in return for preferential long distance phone rates. It is alleged that in exchange for a preferential lower rate from Teleco (the Haitian telephone company) that stymied competition, IDT paid a portion of the revenues to an off shore company owned by former President Jean-Bertrand Aristide. The OTA team advised Preval that a criminal case is close to indictment in the U.S. but U.S. prosecutors were requesting Teleco officials' immediate assistance in providing certain documentation. The U.S. will formally request that assistance this week under the Inter-American Convention Against Corruption, of which both the U.S. and Haiti are signatories. ¶4. (C) Preval spoke fervently about the need to put an end to impunity and corruption within the Government of Haiti (GOH). He emphasized that the GOH would cooperate but was relying on U.S. assistance to successfully prosecute such cases. If the cases were not won, the defendants and other criminals within the GOH would be further emboldened. He expressed his concerns about those in Parliament with drug ties and the results of upcoming elections, in which candidates with alleged drug ties could win office and gain immunity from prosecution as a result. ¶5. (C) In a subsequent July 23 meeting to solve certain procedural issues related to the Financial Crimes (BAFE) unit of the Haitian National Police (HNP),Preval again raised the issue of the IDT investigation. He expressed his frustration that his government has been blamed for the dismissal of a civil case against Aristide in Florida soon after Preval's second term began. He stated that the law firm asked for dismissal of the case without GOH approval as they no longer wished to work on a commission basis and wanted a large payment up front. He asked for clarification from the OTA advisors, who were investigators on the original criminal case before the lawyers retained by the Interim GOH chose to pursue a civil action, about possible criminal prosecutions in the U.S. and Haiti, and expressed the hope that the GOH would receive at least partial restitution. He stated he is strongly considering issuing a "letter" to the Haitian people to explain the situation, but he did not wish to compromise the investigation. OTA advisors assured him that using information in the public domain would not impact the investigation. Preval again promised the cooperation of the PORT AU PR 00001059 002.2 OF 002 GOH and thanked the USG for its assistance. ¶6. (C) Comment: Preval was clearly disturbed by allegations that his government had chosen not to pursue corruption and illegal activities under Aristide as well as recent Internet reports of questionable real estate purchases by Preval. He spoke passionately about corruption and the need to end impunity in Haiti and, in the President's own words, make it a state that "pursues bandits", and not one that "is a bandit". TIGHE