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Cablegate: El Pais Article Critical of Aspects of the Fight

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TAGS: PTER KTFN EFIN KPAO ASEC SP
SUBJECT: EL PAIS ARTICLE CRITICAL OF ASPECTS OF THE FIGHT
AGAINST TERRORISM FINANCE

1. Summary: El Pais, Spain's most influential daily paper,
and the one most closely aligned with the current Socialist
government, has run an article called "The list nobody wants
to be on: The system of rosters featuring details of
suspected terrorists must be improved, experts believe." The
article can be downloaded by accessing the September 5
edition of El Pais and going to the English edition.
However, in order to access the article, a subscription is
required. Please e-mail SchonanderCE@state.gov to request a
faxed version of the article if desired. El Pais is Spain's
leading daily and is generally pro-government. The Ministry
of Foreign Affairs (MFA) counterterrorism coordinator, Angel
Lossada, is quoted by name and unnamed Economy Ministry
officials are also quoted. The newspaper is often used to
float government opinions. Our sense, also based on other
interactions with GOS officials, is that the article captures
fairly accurately GOS opinions on terrorism finance matters,
especially designations. End Summary

2. The allegations and opinions in the article are linked to
the case of the Syrian-born but naturalized Spanish citizen,
Ahmad Mardini. Mardini has lived in Spain for 36 years. He
was arrested in November, 2001, probably because five years
earlier, he had sold a shop to Osama Darra and Mohammend
Needl, who have been sentenced by Spain's High Court for
providing financial assistance to the jihadist cause(s).
Although Mardini was released after five days and has not
been prosecuted for any crime by Spanish authorities, he lost
his job at Coca Cola and was not able to conduct financial
transactions. The newspaper reports that Mardini's name
appears on a "control list" sent to financial institutions by
the Federal Reserve Bank of New York. According to Mardini,
he has not been able to resume a normal financial life:
"Whom can I turn to? For months my brother has been sending
me money from Germany in my wife's name to avoid problems.
I'm still a terrorist suspect. Isn't that crazy?"

3. The key assertion in the article is: "Almost all of the
bank accounts seized in Spain since September 11, 2001, held
by people on the international lists of terrorists drawn up
by the UN and the European Union, have been seized by
mistake, according to sources close to the General
Directorate of the Economy". El Pais goes on to quote an
unnamed Ministry of Finance source: "We have to unfreeze the
vast majority of the frozen accounts. Either they were
similar names or cases of two people sharing the same name,
like that of a person who lived in Seville." According to El
Pais, between 2001 and 2006, some Euros 36,000 have been
frozen involving accounts belonging to 97 people, most of
them Muslims. Only Euros 83.75 remains frozen, and most of
the blocked accounts were empty. (Note: Spain has frozen
roughly a half a million dollars worth of suspected terrorist
assets, but the vast majority of these funds were frozen
prior to 9/11.) A Spanish Federation of Savings Banks (CECA)
source told El Pais: "We have had a lot of incidents because
the lists are not accurate and contain errors. There are
many innocent people whose names coincide with Arabic names
and terrorists".

4. El Pais characterizes the seizure of bank accounts held by
suspected terrorists as an "Anglo-Saxon tool". Afterwards,
the newspaper describes and/or mentions the State
Department's Specially Designated Global Terrorist list
(SDGT), the list maintained by the Office of Foreign Assets
Control (OFAC), a Commerce Department list, a CIA list, a
list maintained by the Financial Action Task Force on
non-cooperative countries, the Canada Consolidated List, the
World Bank Barred Parties list, the Blocked Officials File, a
UK list and two additional lists used in Europe as a result
of UN initiatives. The article notes correctly that an
individual need not have been convicted of anything in order
to be designated as a terrorist for asset freezing purposes.
However, El Pais quoted an unnamed "civil servant" based in
Brussels (presumably Spanish) as saying: "Spain has been used
as an example by the staunchest defenders of due processes.
We only add individuals or groups with a final criminal
sentence". Spain's MFA counter-terrorism coordinator Angel
Lossada appears to support this view. He is quoted by name
as saying: "Some countries like the Netherlands, support the
need to apply this to other kinds of administrative,
police-related or intelligence decisions. The advantage is
the effectiveness in terms of prevention, but with the loss
of rights." He went on to say: "If the mistakes are not
corrected, pressure from the financial operators will become
intense. The lists must be kept up to date and not be based
solely on their capacity to freeze funds, but on the
political value of isolating those who appear on them; that
terrorists must not be able to move freely around the global
economic system."

5. Comment: We are confident that the Spanish financial

authorities search for assets upon prenotifications and
notifications. The fact that 97 people, according to the
article, have had assets frozen since 9/11 indicates just
that. However, our assessment is that Spanish authorities
would welcome a greater emphasis on operational cooperation.
Septel provides recommendations on closer cooperation.
Moreover, it would be helpful to get guidance on how more
rigorous development of identifying information in U.S.
designation packages is making the risk of false positives
much less likely.
LLORENS

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