UNRWA'S SYRIA CHIEF FRETS ABOUT FINANCES

C O N F I D E N T I A L DAMASCUS 000050 SIPDIS LONDON FOR LORD, PARIS FOR NOBLES E.O. 12958: DECL: 01/14/2020 TAGS: KDEM KPAL SOCI PREL PREF PHUM SY SUBJECT: UNRWA'S SYRIA CHIEF FRETS ABOUT FINANCES Classified By: CDA Charles Hunter for Reasons 1.4 (b) and (d). ¶1. (C) SUMMARY: United Nations Relief and Works Agency's (UNRWA) Syria Country Representative Roger Hearn told Staffdel Marcus January 9 that his organization's "surreal" financial situation is so dire, due mostly to donor fatigue, that it requires immediate attention and may entail "a complete reconfiguration of the way UNRWA works in Syria." Responding to the first of two perennial congressional concerns regarding UNRWA, Hearn said his organization was looking into whether UNRWA could use a bank other than the Commercial Bank of Syria, designated by the U.S. Treasury Department as a financial institution of "primary money laundering concern," to pay its employees. He also noted that he hoped to direct a curriculum review effort at UNRWA schools to ensure textbooks are not promoting extremism. END SUMMARY. "SURREAL" FINANCIAL SITUATION ¶2. (C) UNRWA Country Representative Roger Hearn told us January 9 he inherited a severe crisis when he took over UNRWA's Syria operations in October. Hearn said without significant financial reform, "the possibility exists of a complete reconfiguration this year of the way UNRWA works in Syria." Hearn described the funding problems of UNRWA's Syria office as "surreal," noting that even if he fired half the staff the organization would only incur additional debt due to indemnities. ¶3. (C) UNRWA's biggest challenge at the moment is donor fatigue as the organization marks 60 years of serving Palestinian refugees in Syria, now numbering over 470,000 according to official estimates. In addition, Hearn said donors are also spreading their money to other worthy refugee causes such as assistance to Iraqis. The country director stated that his initial efforts at financial reform generated some "hate mail," from both Syrians and people within the organization, charging him with abandoning the needs of Palestinian refugees. ¶4. (C) Despite UNRWA's significant financial challenges, Hearn remained optimistic the organization's efforts will continue in Syria partly because "the Syrians won't let UNRWA in Syria die; it's too important to them politically." However, it was possible his office would have to scale back some efforts unless a long-term solution is found. ¶5. (C) Responding to the first of two concerns on Staffdel Marcus' agenda, Hearn relayed that upon his arrival he had read a note from the organization's legal counsel regarding UNRWA's use of the Commercial Bank of Syria, designated by the U.S. Treasury Department as a financial institution of "primary money laundering concern" under the USA Patriot Act, to pay its local employees. UNRWA chose the bank because it has branches and ATMs in cities across the country. UNRWA's lawyers are looking into whether an alternate bank could be used which also has branches in several major Syrian cities, and that Beirut-based Bank Audi is one possibility. Hearn pledged to keep the Embassy apprised of progress on this subject. ¶6. (C) Turning to his mission's substantive work, Hearn related that one of his goals this year is to direct a curriculum review at schools run by UNRWA in Palestinian camps. While he stressed no evidence existed that objectionable material was being used at the schools, he said the move was wise "to make sure we are not educating a generation of extremists." Hearn said he expected this effort to commence shortly. HUNTER