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Cablegate: Three Plus One Readout

VZCZCXYZ0001
PP RUEHWEB

DE RUEHAC #0062/01 0291716
ZNY CCCCC ZZH
P 291716Z JAN 08
FM AMEMBASSY ASUNCION
TO RUEHC/SECSTATE WASHDC PRIORITY 6559
INFO RUCNMER/MERCOSUR COLLECTIVE

C O N F I D E N T I A L ASUNCION 000062

SIPDIS

SIPDIS

WHA/FO CMCMULLEN, S/CT VPALMER, ASIERRA, WHA/BSC MDRUCKER,
BFRIEDMAN, CCROFT, DOJ/OPDAT KO'CONNER, TREASURY, DHS/ICE

E.O. 12958: DECL: 01/17/2028
TAGS: PTER KCRM PGOV GTIP SNAR PA BR AR
SUBJECT: THREE PLUS ONE READOUT

Classified By: Ambassador James C. Cason; reasons 1.4 (b) and (d).

--------
SUMMARY
--------

1. (C) The January 10-11 Three-Plus-One Security Dialogue
with Brazil, Argentina, Paraguay and the United States in
Asuncion played out as expected, with fruitful coordination
on the margins of the meeting, but plenary interventions from
the three focused primarily on crime fighting and preserving
the reputation of the Tri-Border Area (TBA). U.S.
presentations noted that the United States, as host of the
next meeting, planned to broaden discussions to include arms
and drug trafficking, money laundering and copyright piracy,
the focus of past Three-Plus-One sessions. The Argentine
delegation noted for the first time at a "3 Plus 1" plenary
that AMIA bombing conspirators had worked through the TBA.
Progress on the Brazilian-sponsored Regional Intelligence
Center in Foz do Iguazu remains slow, but the three will meet
in February to confirm staffing arrangements. Paraguay noted
that illicit financing often leads to terrorist financing,
but stressed that there was no evidence of operational
terrorist cells in the region. The final communiqu included
a loosely worded commitment to work on a joint illicit
finance study (threat assessment) before the next plenary
which we hope will facilitate discussion of multilateral
cooperation (including on cash couriers) and technical
assistance. In addition to offers of cash courier and
document fraud training for countries in the region, the
United States should host meetings of experts from the group
(e.g. Financial Intelligence Units) to create positive
momentum for cooperation. END SUMMARY.

--------------------------
U.S. OPENING INTERVENTION
--------------------------

2. (U) S/CT Deputy Coordinator Virginia Palmer and WHA DAS
Chris McMullen jointly led an interagency delegation to the
6th annual plenary session of the Three-Plus-One Security
Group, January 10-11 in Asuncion. Their opening statements
emphasized the value of continued counter-terrorism (CT)
cooperation and the need for broader engagement within the
region on security concerns. Palmer outlined global terrorist
trends, including links between transnational crime and
terrorism; an increase in homegrown (or guerrilla vice
expeditionary) terrorist groups loosely affiliated with al
Qaida; and the aggregation of regional terrorist groups and
continued terrorist interest in acquiring weapons of mass
destruction. She highlighted successes in international
cooperation to bring terrorists to justice and noted the
importance of addressing the conditions that terrorists
exploit. Palmer noted the U.S. Congressional endorsement of
the Three-Plus-One mechanism in HR 435.

3. (U) WHA DAS Chris McMullen reiterated the need for
expanded engagement among the partners. He commended the
progress made by the three countries in improving passport
controls, investigating suspicious activities, increasing
custom controls, and conducting joint patrols of land and sea
borders. DAS McMullen also noted the need to address common
crimes and transnational threats. In a subsequent
intervention he suggested expanding the discussion to include
broader security issues and the plans to address trafficking
in arms, drugs, and persons, money laundering, and document
fraud at next year,s plenary. McMullen expressed USG
willingness to provide capacity building through training in
bulk cash smuggling; bioterrorism and food defense; waterways
management; and detection of arms and munitions trafficking.

------
FIU'S
------

4. (U) During the session devoted to the efficient exchange
of information, Palmer noted the usefulness of the FIUs,
intercessional activities. In response to Brazilian concerns
regarding delays in FinCen's response times to requests for
case information, FinCen,s Mauricio Pastora held sidebars
and orchestrated a joint meeting of FIU representatives on
the margins of the meeting to discuss collaboration and
enhanced financial information sharing, including: timely
information exchanges, voluntary and spontaneous disclosures,
and bilateral cooperation between each of the South American
countries, FIUs and FinCen. All four FIU representatives
committed to continued collaboration on both money laundering
and terrorist finance, a review of pending cases and regular
telephone follow up.
--------------------------------------------- ---
TTU'S -- EXPANDING REGIONAL INFORMATION SHARING
--------------------------------------------- ---

5. (U) U.S. Department of Homeland Security (DHS/ICE)
delegates Carlos Maza and Guillermo Cancio commended the work
of the Tri-Border countries' Trade Transparency Units (TTUs)
which utilize import and export data to identify suspicious
trading patterns indicative of criminal activity. The three
TTUs currently share data bilaterally with only the USG.
The DHS/ICE delegates urged regional trade data sharing and
suggested using the Foz de Iguazu Regional Intelligence
Center as a host for trade-related data.

-------------------------
BIOTERRORISM COOPERATION
-------------------------

6. (U) Andrea Lauritzen of State,s Office of Environment
and Science briefed on integrated efforts on bioterrorism and
agroterrorism and provided the Argentine and Brazilian
delegations with sample training materials on strengthening
food defense. Brazilian assertions (backed up by the
Argentine delegation) that food defense issues were not
relevant in the TBA effectively shut down the Three-Plus-One
mechanism as a forum for discussion of bioterrorism issues,
however.

7. (U) COMMENT: The Brazilian delegation was not persuaded
that matters not strictly related to the TBA were relevant to
Three-Plus-One discussions. GOB argued that bio or
agroterrorism attacks were not likely to come from the TBA,
but in any event were subjects more appropriately discussed
in another forum. Nonetheless, during side conversations,
Argentine and Paraguayan officials expressed interest in
collaborating bilaterally on efforts to counter bioterrorism
and agroterrorism as well as strengthen food defense. As a
condition of mentioning bioterrorism in the meeting's final
communiqu, GOB insisted on including a statement that it did
not believe that Three-Plus-One was the appropriate venue for
these discussions. END COMMENT.

-----------------------------------------
DOCUMENT FRAUD AND CASH COURIER TRAINING
------------------------------------------

8. (U) All delegations welcomed efforts to improve document
security. The United States offered to provide training
similar to successful programs provided Paraguay and
Argentina to Brazil. (Note: Dates for the Document Fraud
Training were forwarded to the GOB on January 21. End Note.)
Palmer briefed on worldwide efforts to combat bulk cash
smuggling and terrorist use of cash couriers, stressing that
the OAS' CICTE efforts were part of this effort and would not
focus on the TBA.

9. (U) U.S. Department of Treasury officials Charles Ott and
Rachel Fedewa introduced the concept of threat assessment as
a tool for identifying gaps and possible initiatives in
combating money laundering and terrorist financing. They
suggested that the four countries work together to produce a
joint threat assessment of the TBA prior to the next plenary
session. Communiqu language (informal translation) states:
"The participants of the Mechanism consider it very important
to identify between now and the next meeting of the Group
affairs that may constitute specific problems related to
illegal financing and other affairs referring to the security
of the tri-border area. The participants have estimated that
thus they will be in a better position to direct the problems
identified in the framework of the Three-Plus-One, in
addition to the endeavors already carried out by national
authorities in the three countries."

10. (U) During the discussion of United Nations Security
Council Resolution (UNSCR) 1373, the U.S. delegation detailed
its progress in meeting its obligations. The USG assessment
of its compliance with UNSCR 1373 is available on the
internet.

------------------------
ARGENTINE INTERVENTIONS
------------------------

11. (U) In his opening remarks, the head of Argentina's
delegation, Amb. Orlando Rebagliati, extolled the cooperation
of the Three-Plus-One in the TBA and the political will to
work on "border security issues." He recalled the early
recognition by Argentina, Brazil and Paraguay of the
sensitive areas of vulnerability pertaining to the TBA, which
led to a meeting in 1996 of security forces from the three
countries, resulting in a Tripartite Command. Rebagliati
said the TBA needs preventive measures, and the GOA hoped
that dialogue and cooperation among the Three-Plus-One would
help define priorities and improve coordination. Echoing the
opening remarks made by his Brazilian and Paraguayan
counterparts, Rebagliati said the 3 1 needed to address the
damage that had been done to the TBA, whose reputation as a
hotbed for terrorist activity had been greatly "exaggerated
and distorted." Rebagliati said the TBA, like many frontier
zones around the world, was difficult to control, but the
three countries maintained a "strong presence" there, and the
preponderance of the region's inhabitants were law-abiding
citizens who had been unfairly maligned.

12. (U) In subsequent interventions, Rebagliati emphasized
the need for real-time sharing of intelligence. However, he
also said that, while there is room to improve on exchange of
information among the Three-Plus-One, they should not
duplicate exchanges underway in FATF (GAFID), GAFISUD, CICTE,
or elsewhere. He said the Three-Plus-One should not attempt
to take up aspects of each other's global counter-terrorism
efforts that were not directly related to the TBA. The
Three-Plus-One forum should remain focused on the TBA and
avoid inadvertently encroaching on the jurisdiction of other
agencies, domestic or international. In discussing a U.S.
proposal to have experts from the Three-Plus-One work
inter-sessionally to develop TBA threat assessments, the
Argentine delegation said it would need to refer to its
capital for instructions before agreeing to any
"institutional deviation" from the above.

13. (U) In the presentation of contributions to security in
the TBA, the Argentine delegation highlighted the enactment
in June of legislation criminalizing terrorism as well as the
financing of terrorist activity, bringing Argentina into
compliance with FATF standards. The Argentines noted they
were already acting on their new legal authority to
investigate conspiracies to commit terrorist acts, regardless
of whether the acts took place. The Argentine delegation
noted that the Argentine prosecutors investigating the deadly
July 1994 bombing of the AMIA center had traced the bomber to
the TBA.

14. (U) The delegation noted that the GOA had designated SIDE
and PF liaisons for the Regional Intelligence Center in Foz
do Iguacu. It also pointed out the GOA's Coast Guard
(Prefectura), Gendarmerie, Federal Police, Airport Police,
and Intelligence Secretariat (SIDE) were participating in the
Tripartite Command. The Coast Guard (Prefectura) was engaged
in joint patrols with Paraguay along the Misiones and
Corrientes borders to enhance its interdiction of narcotics
trafficking and arms trafficking. The Federal Police's (PF)
Anti-Terrorist Unit (created after the 1994 AMIA bombing) had
deployed to the PF's station in Puerto Iguazu, where there is
actually a low crime rate other than contraband. Argentine
Customs had begun deploying mobile cargo scanners as well as
a canine unit, and Migration Police were strengthening their
border controls, and the Gendarmerie were working with their
Brazilian and Paraguayan counterparts on cross-border
kidnapping cases.

----------------------
BRAZIL'S INTERVENTION
----------------------

15. (U) Brazil's opening statement noted its concern with the
threat from organized crime in border areas and its common
interest in combating terrorism with its neighbors. The
Brazilian delegation expressed concern that focus on the TBA
could "denigrate" the image of a culturally diverse region,
where Brazilian agencies have found no evidence of terrorist
activity. Brazil further objected to the use of the
Three-Plus-One as a forum for information sharing, arguing
that this was better done bilaterally.

16. (U) Brazil took a similar position on other issues. Both
TTU and food defense could be of interest to Brazil, but only
outside the Three-Plus-One. Brazil would prefer to address
these issues bilaterally and outside the TBA context. The
Brazilians also believed that this was not the proper forum
for discussion of UN resolution 1373 but noted that Brazil
has several counter terrorism projects underway. The
Brazilian delegation also briefed on steps taken to improve
border security, including increased bilateral cooperation
and annual growth in seizures of merchandise at border
crossings. The Brazilian delegation responded negatively to
Treasury's proposal for a threat assessment, noting that
existing information exchanges would present a clear picture
of possible threats.
17. (U) COMMENT: Throughout, the Brazilian delegation sought
to deflect issues of substance from the Three-Plus-One,
preferring bilateral approaches with its neighbors. Brazil
was also defensive regarding the TBA, complaining that the
GOB did not want "to have to defend the TBA in yet another
forum." However, this sensitivity did not prevent Brazil
from refusing to discuss health-related issues that were not
unique to the TBA. END COMMENT.

------------------------
PARAGUAY'S INTERVENTION
------------------------

18. (U) In his opening statement, Paraguayan Vice-Minister
Antonio Rivas lamented the terrorist attack that killed
Pakistani opposition leader Benazir Bhutto and called for a
renewed commitment from the international community to
confront terrorist threats. Rivas said the GOP
"energetically rejects" any and all terrorist acts. Rivas
asserted Paraguay,s interest in combating transnational
organized crime and ensuring regional security, but also
noted the absence of any evidence of operational terrorism in
the region. He contended there is no causal, automatic link
between crime and terrorist financing, and urged the other
delegations not to "satanize" the Tri-Border Region (TBA).

19. (U) Paraguay,s chief of delegation, Victor Hugo Pena,
gave a comprehensive presentation on his country,s efforts
to counter terrorism and transnational crime. He reported
increases in marijuana and cocaine seizures in 2007, noting
that 90 percent of drugs passing through Paraguay are
destined for Brazil. He also cited successful operations to
seize pirated goods and arms and GOP efforts to counter
trafficking in persons. In 2007, the public ministry created
a new counter narcotics prosecutorial unit and revised
Paraguay,s penal code (which became law on January 16).
Pena applauded the efforts of SEPRELAD, Paraguay,s
anti-money laundering secretariat, to prosecute unlicensed
exchange houses, and also noted Paraguay,s participation in
US funded OAS/CICTE training courses on document fraud
prevention, critical infrastructure protection, and
cyberterrorism. Pea said construction of the public
ministry,s forensic lab is ongoing and announced plans to
install radar to cover Paraguayan air space. (COMMENT: The
GOP has long lacked radar coverage, but remains far from
fulfilling this goal in the foreseeable future. END COMMENT).
He said within the next week, an executive decree would
expand SEPRELAD,s jurisdiction beyond money laundering to
cover terrorist finance. Finally, the GOP attempted to allay
concerns regarding Paraguay,s failure to pass anti-terrorist
legislation by assuring delegates that the GOP would
prosecute terrorists under its penal code. (NOTE: President
Duarte signed Paraguay's new penal code into law on January
16. END NOTE.)

20. (U) Paraguayan delegates asserted that socio-economic
development is critical to preventing crime. They thanked
the US delegation for a wide range of assistance, but asked
that the United States share a "higher quality" of
information when informing Paraguay of U.S. terrorist
designations to facilitate local investigations. Ciudad del
Este Prosecutor Eber Ovelar thanked the U.S. delegation for
its offer to share TTU data, noting that false invoices are a
common customs problem. Pea requested information
regarding the Bank of America case, prosecuted by the New
York District Attorney,s office, regarding money moved
illegally through Paraguay. The GOP also requested
training/assistance on bulk cash smuggling.

--------------
FINAL COMMENT
--------------

21. (C) Paraguay and Argentina interventions were more
helpful than they were last year, when discussions were
soured by the U.S. designation of nine individuals and
entities in the Triborder Area. Paraguay's intervention
demonstrated its willingness to expand the meeting's agenda
to broader law enforcement issues per the United States'
request, but neither Paraguay nor Argentina was willing to
challenge Brazil directly. Palmer,s recommendation,
inspired by comments of Paraguay,s Ambassador in Washington,
that the group do more publicly to highlight the cooperation
in the Three-Plus-One mechanism was rejected bluntly by the
Brazilian delegation, clearly interested in giving the
mechanism as little weight or public attention as possible.
END COMMENT.

21. (U) Participants:
Paraguay Delegation
-------------------
Antonio Rivas Palacios, Vice Minister of Foreign Relations,
Ministry of Foreign Relations
Victor Hugo Pea Bareiro, Director General, Special Affairs,
Ministry of Foreign Relations
Elisa Aguayo Rolon, Chief, International Desk II, Ministry of
Foreign Relations
Javier Benitez, Ministry of Foreign Relations
Desiree Montero, Ministry of Foreign Relations
Lucio Aguilera, Ministry of Foreign Relations
Fabian Duarte, Ministry of Foreign Relations
Luis Carlos Escobar, Ministry of Foreign Relations
Nelly Delgado, Ministry of Foreign Relations
Maria Mercedes Dominguez, Ministry of Foreign Relations
Carlos Alberto Zelaya, Vice Minister of Home Security,
Ministry of the Interior
Blanca Lopez, Director of International Cooperation, Ministry
of the Interior
Fidel Alejandro Isasa, Commandant General, National Police
Carlos Ramon Altemburger Santander, Director, Secretariat for
Terrorism Prevention and Investigation
Carlos Humberto Benitez Gonzalez, Sub commissioner,
Secretariat for Terrorism Prevention and Investigation

SIPDIS
Armando Ruben Barboza Aguilera, Director, INTERPOL
Pablo marcial Cespedes Carrillo, Chief, Department of Police
Intelligence
Ruben Zaracho, Subcommissioner Foz de Iguazu, Department of
Police Intelligence
Guillermo Pastor Gomez Mareco, Chief, Department of Police
Planning
Ivan Mauricio Ojeda Aguilera, Director General, General
Directorate of Migration
Domingo Quinonez, Secretary General, General Directorate of
Migration
Angel Caballero Sostoa, Director of Foreign Admissions,
General Office of Migration
Cesar Aguilera, Vice Minister of Defense, Ministry of
National Defense
Benito Silvera, Director of Strategic Policy, Ministry of
National Defense
Eligio Vera y Aragon, National Coordinator, National Civil
Aviation Directorate
Juan Mendez Trebastoni, Chief of Arms Registry, Armaments
Directorate
Gedeon Escobar, Chief of Imports and Acquisitions, Armaments
Directorate
Venancio Roman,Legal Advisor, Armaments Directorate
Hernan Morinigo, International Affairs Officer, Armaments
Directorate
Americo Ibarra Collar, Chief of Maritime Affairs, National
Naval Command
Carlos Alberto Aguero Miranda, Second Commander of the Ciudad
del Este Area, National Naval Command
Carlos Arce Obregon, Vice Minister of Justice, Ministry of
Justice and Labor
Gladys Santa Cruz, Director of the National Employment
Service, Ministry of Justice and Labor
Felix Cruz, Specialized Technical Unit Coordinator, Ministry
of Industry and Commerce
Gustavo Ivaldi, Specialized Technical Unit
Carlos Saucedo Aquino, Specialized Technical Unit
Miguel Maria Gonzalez Avila, Specialized Technical Unit
Silvio Amarilla, Intelligence Director, National
Anti-Narcotics Secretariat
Juan Carlos Jacquet, Director of Financial Crimes, National
Anti-Narcotics Secretariat
Edgar Almada, Special Agent, National Anti-Narcotics
Secretariat

SIPDIS
Angel Gabriel Gonzalez Caceres, Director, Anti-Money
Laundering Secretariat
Elizabeth Portillo, Analysis Coordinator, Anti-Money
Laundering Secretariat
Crismilda Maricel Espinosa, Judicial Affairs Officer,
Anti-Money Laundering Secretariat
Rosa Otazu, Director of International Affairs, National
Secretariat for Children and Youth

SIPDIS
Carlos Laguardia, Vice Director, National Customs Directorate
Carlos Martini, National Customs Directorate
Oscar Boidanich Ferreira, Intendent Bank Supervision, Central
Bank of Paraguay
Luis Maria Benitez Riera, Supreme Court
Eber Ovelar,Deputy Attorney General, Ciudad del Este, Public
Ministry
Rocio Vallejo,Deputy Attorney General, Public Ministry
Marco Alcaraz,Deputy Attorney General, Public Ministry
Juan Emilio Oviedo, Director of International Affairs, Public
Ministry

Argentina Delegation:
-----------------------
Orlando Ruben Rebagliati, Ambassador, Argentine Embassy in
Paraguay
Jose Ignacio Tobella, Minister, Argentine Embassy in Paraguay
Gustavo M. Terrera, Counselor, Argentine Embassy in Paraguay
Rosa Falduto, President, Financial Information Unit
Graciela Insaurralde, Financial Information Unit
Graciela Misuraca, Customs General Directorate
Oscar Alfredo Iribarne, Chief, Antiterrorist Operational
Division
Maria Laura Pose, Airport Security
Victoria Giovenco, National Directorate of Immigration
Nestor Campora, National Directorate of Immigration
Rodolfo Barrandeguy, Commandant, Argentine Border Patrol
Guillermo Raul Rodriguez, Prefect, Argentine Naval Prefecture
Carlos Gesto, Intelligence Secretariat
Marcelo Horacio Martin, Principal Officer, Argentine Federal
Police

Brazil Delegation
-----------------
Virginia Toniatti, Minister, General Coordinator, General
Coordination of Transnational Illicit Acts
Paulo Marcio Neves Rodrigues, Executive Secretary, Financial
Activities Control Council
Jorge Luiz Vieira Tavares, General Coordination of
Conservation Units
Clarissa Forecchi Gloria, General Coordination of
Transnational Illicit Acts
Jose Luiz Machado e Costa, Brazil Embassy in Paraguay
Aloysio Mares Dias Gomide Fihlo, Brazil Embassy in Paraguay
Camile Nemitz Filippozzi, Brazil Embassy in Paraguay
Aparecido De Franca, Customs and Taxes Attache, Brazil
Embassy in Paraguay
Carlos Cuenca, Brazil Embassy in Argentina
Roberto Doring Pinho da Silva, Brazil Embassy in Washington
Jose Carlos Chalmers Calazane, Chief, Federal Police Foz de
Iguazu
Marcus Vinicius Da Silva Dantas, Deputy Chief, Division to
Combat Illicit Arms Traffic
Fernando Queiroz Segovia Oliveira
Paulo Tarso Resende Paniagua, Deputy General Coordinator,
Intelligence of Transnational Illicit Acts
Paulo Antonio Sousa, Federal Police
Nelson Rodrigues de Oliveira, Department of Illicit Financing
Acts, Central Bank
Jose Ricardo Petardo Botelho, Advisor, Presidential
Institutional Security Office
Fernardo Augusto Cunha de Holanda, Ministry of Defense

United States Delegation
---------------------------
Virginia Palmer, Deputy Assistant Secretary and Deputy
Coordinator for Regional and Trans-Regional Issues,Office of
the Coordinator for Counter-Terrorism
Chris McMullen, Deputy Assistant Secretary, Western
Hemisphere Affairs
James Cason, Ambassador, U.S. Embassy in Asuncion
Arnold Sierra, Counter-Terrorism
Andrea Lauritzen, Office of International Health and
Biodefense
Jennifer Showell, International Narcotics and Law Enforcement
Affairs
Caroline Croft, Office of Brazilian and Southern Cone Affairs
Bruce Kleiner, Deputy Chief of Mission, U.S. Embassy in
Asuncion
Joan Shaker, Political and Economic Chief, U.S. Embassy in
Asuncion
Kevin Sundwall, Regional Legal Advisor, U.S. Embassy in
Asuncion
Luis Hernandez, Economic Officer, U.S. Embassy in Asuncion
Alex Featherstone, U.S. Embassy in Buenos Aires
Javier Gonzalez, U.S. Embassy in Brazil
Charles Ott, Department of Treasury
Mauricio Pastora, Department of Treasury
Clyde Rhoades, Department of Treasury
Nicole Bontrager, Department of Defense
David Brassanini, Department of Justice
Sharon Halstead, Department of Justice
Carlos Maza, Department of Homeland Security
Guillermo Cancio, Department of Homeland Security
Douglas Freeman
Carlos Savignon
Karrin Morano Taxman
Ricardo Grave de Peralta
Rachel Fedewa

Cleared by WHA/FO McMullen and S/CT Palmer.

Please visit us at http://www.state.sgov.gov/p/wha/asuncion

CASON

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