US embassy cable - 04ABUDHABI2591

C O N F I D E N T I A L SECTION 01 OF 02 ABU DHABI 002591 
 
SIPDIS 
 
STATE FOR NEA/ARP, S/CT, INL/ENT, EB/ESC 
STATE PASS FEDERAL RESERVE 
TREASURY FOR ZARATE, GLASER, AND MURDEN 
 
E.O. 12958: DECL:8/3/14 
TAGS: EFIN, ETTC, PTER, ECON, TC 
SUBJECT:  UAE ANTI TERRORISM LAW ADDRESSES TERRORIST 
FINANCING CONCERNS 
 
Ref Abu Dhabi 1371 
 
Classified by CDA Richard Albright for reasons 1.5 (b &d). 
 
1. (U) On July 28, the UAE issued "Federal Law 
Number 1 on Combating Terrorist Crimes, which 
criminalizes terrorist acts, sets up a national 
anti-terrorism committee, and criminalizes 
terrorist financing.  Post is analyzing the law and 
will provide a fuller readout septel.  This cable 
provides a brief overview of some of the law's 
provisions as they relate to terrorist financing. 
The law specifically criminalizes the raising of 
funds for and/or transfer of funds with the aim or 
knowledge that some or all of the funds will be 
used to fund terrorist acts (whether the crime is 
committed or not). The law confirms the Central 
Bank's authority to freeze an account for up to 
seven days.  It also gives the Attorney General the 
authority to order the Central Bank to freeze 
assets if he has evidence or reason to believe that 
they are related to funding or committing a 
terrorist activity.  The Attorney General can 
freeze the assets until the conclusion of the 
investigation.  The law gives the defendant a right 
to judicial review of an asset freeze within 14 
days of the defendant filing a complaint.  It 
specifies, however, that the Federal Supreme Court 
is the only competent authority to rule on 
terrorism cases.  The law also states that the 
UAE's anti-terrorism Committee will continue to 
execute the UNSCRs related to terrorism. 
 
2. (C) EconChief met with Central Bank Governor 
Sultan Nasser Al-Suwaidi on August 3 to discuss the 
law and its provisions countering terrorist 
financing. Al-Suwaidi said that, although the test 
would be in how the law was implemented, he thought 
it would make the Central Bank's job easier.  For 
example, the law specifically criminalizes 
terrorist financing making it a predicate crime for 
money laundering and refers to implementing UNSCRs 
related to terrorism. 
 
3. (C) Al-Suwaidi said that, when the law came to 
the cabinet for review, he insisted that two 
clauses be added to it: 1) a specific reference to 
implementing UN Security Council Resolutions 
regarding the combating of terrorism, and 2) legal 
protections for the Central Bank in the performance 
of its duties.  Al-Suwaidi noted the problems that 
the Central Bank occasionally had with the attorney 
general's office when it wanted to freeze accounts 
of suspected terrorists pursuant to a UNSCR.  The 
"lawyers" would want evidence to justify a freeze. 
The specific reference to implementing the UNSCRS 
on terrorism addresses these concerns.  Al-Suwaidi 
noted that he had to exert some effort to get the 
reference added.  He said that Abdulrahim Al-Awadi 
(the head of the FIU) had to provide MOJ stacks of 
papers showing that the reference was necessary. 
Fortunately, he added, in his dry jocular manner, 
Al-Awadi likes to collect papers.  AL-Suwaidi said 
that he thought that the Central Bank would 
nominate Al-Awadi for the anti-terrorism committee, 
since he had been most heavily involved in drafting 
the new law. 
 
4. (C) Al-Suwaidi stated that the law would not 
impede the Central Bank's ability to cooperate with 
the USG.  He concluded by noting that the timing 
was especially good, because the Central Bank was 
in the process of preparing its response to an IMF 
assessment on how well the UAE was complying with 
the Financial Action Task Force "Special 
Recommendations on Terrorist Financing."  He said 
"now we have some new information to give them." 
(For example, the UAE has now specifically 
criminalized the financing of terrorism and 
associated money laundering and ensured that 
terrorist financing is considered as a money 
laundering predicate offence.) 
 
5. (C) Comment:  Based on Al-Suwaidi's comments and our 
initial reading of the law, it looks like it will improve 
the UAEG's ability to freeze the assets of suspected 
terrorists legally.   At our request, the UAE Central Bank 
has frozen indefinitely a number of bank accounts since 
9/11 related to suspected terrorists -- and in spite of the 
requirements of Law No. 4 to produce evidence to the Public 
Prosecutor or release the funds.  This law appears to give 
the Central Bank, and the UAEG more generally, the legal 
authority it needs to deal with terrorist financing.  The 
Central Bank is in the process of translating the law. 
Post will pass it to NEA/ARP, EB, and Treasury when we 
receive it.  End Comment. 
 
Albright