Cablegate: Terrorism Finance: Unscr 1617 Implementation

This record is a partial extract of the original cable. The full text of the original cable is not available.




E.O. 12958: N/A

REF: (A) STATE 145310; (B) WELLINGTON 160

1. Summary: The New Zealand government announced August 12
that a FATF evaluation confirmed the need for more
regulation of the country's financial sector to safeguard
against money laundering and terrorist financing. Post
issued a news release welcoming that announcement, as part
of our action plan to support New Zealand's efforts to
combat terrorist financing. End summary.

2. As requested in ref A, post's Country Team met August 10
to discuss how we could take advantage of the passage of UN
Security Council Resolution 1617 and develop an action plan
to engage the New Zealand government and private sector in
initiatives supporting efforts to combat terrorist
financing. As a result, the Country Team decided to issue a
media statement acknowledging New Zealand's fight against
terrorism and welcoming a government announcement expected
August 12 on a report on New Zealand by the Financial Action
Task Force (FATF) and the Asia/Pacific Group on Money
Laundering (APG). Post's media statement is reprinted in
Paragraph 9.

3. In their "Report on Observance of Standards and Codes,"
FATF and APG said that New Zealand's legislative measures
for combating money laundering and terrorist finance were
"generally sound" and that foundations for an effective
preventive system were in place. The report said, however,
that some minor legislative and regulatory changes could
enhance the system. In particular, it recommended that a
system be introduced to supervise and monitor compliance by
financial and other institutions with their obligations to
combat money laundering and terrorist financing. The report
noted that New Zealand is not a major financial center and
that no evidence of terrorist financing activity has been
uncovered. The report summarized the level of New Zealand's
compliance with the FATF 40-plus-9 recommendations.

4. Minister of Justice Goff reported in a statement August
12 that the FATF evaluation of New Zealand's financial
sector had confirmed that "planned regulation announced
early this year is needed to fully safeguard against money
laundering and terrorist financing." He noted that, while
the financial sector had been extensively deregulated in the
1980s and 1990s, the FATF evaluation outlined the need for
some re-regulation.

5. In February, Goff announced legislation to implement
controls over the financial sector to meet FATF requirements
(ref B). In June, he introduced a bill addressing FATF
recommendations on dealing with the proceeds of crime. The
government is seeking comments from the financial sector on
the proposed regulations.

6. The proposed regulations include: a comprehensive
monitoring framework to ensure all financial institutions
meet standards for countering money laundering and terrorist
financing; a registration regime governing money transfer or
currency change services; statutory requirements for
financial institutions to comply with customer due diligence
and to implement internal anti-money laundering systems and
procedures; and, a requirement for financial institutions to
obtain, verify and retain information on the identity of the
originators of wire transfers.

7. The Dominion Post newspaper on August 13 reported on
Goff's announcement and noted the U.S. Embassy's statement,
saying that the Embassy welcomed the announcement.

8. Comment: The New Zealand government has been diligent in
working to update its anti-terrorism law and to comply with
the FATF 40-plus-9. It also is conducting a review of its
anti-terrorism law, which is scheduled to be completed by
December 1. End comment.

9. Embassy Wellington's media statement, August 12:

Begin statement:

The United States acknowledges New Zealand's continued
commitment to thwart terrorism and welcomes the progress
outlined by Minister Goff this morning.

"New Zealand demonstrates a clear understanding of the
importance of international cooperation in the areas of
money laundering and terrorist financing and recognizes that
it is our shared interests to work together to combat such
criminal activities," said U.S. Charg d'Affaires David

New Zealand's continued technical and training assistance in
the Pacific region is also deeply valued by the United
States and other members of the international community.

"The United States enjoys working with New Zealand to assist
other countries in the region and we look forward to
continuing to do so," Mr. Burnett added.

The United States also welcomes the recent unanimous UN
Security Council adoption of Resolution 1617, reaffirming
and strengthening international sanctions on Al Qaeda, the
Taliban, and their associates.

"The U.S. worked closely with other members of the Security
Council in the drafting of the Resolution, and we look
forward to deepening our partnership with the United
Nations, New Zealand and with governments around the world
to implement its provisions," said Mr. Burnett.

Resolution 1617 improves the international community's
efforts to combat terrorism by more clearly identifying
terrorists who are subject to UN sanctions, by endorsing an
effective set of standards and practices for implementing
the financial sanctions imposed on them, and by facilitating
cooperation among various counter-terrorism committees and
bodies. It also extends the mandate of the Analysis and
Monitoring Team, which helps the Council oversee the
implementation of these sanctions.

Resolution 1617 carries forward a consolidated list of
terrorists tied to the Taliban, Osama bin Laden, and Al
Qaeda. Inclusion on the list triggers international
obligations upon all UN member countries, requiring them to
freeze the assets and prevent the travel of listed
individuals and to block the sale of arms and military


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