US embassy cable - 04ABUDHABI4293

UNCLAS ABU DHABI 004293 
 
SIPDIS 
 
STATE FOR NEA/ARP, S/CT, INL/ENT, EB/ESC 
TREASURY FOR ZARATE, GLASER AND FINCEN FOR BAITY 
MANAMA FOR BEAL 
 
E.O. 12958: NA 
TAGS: EFIN, ETTC, PTER, ECON, TC 
SUBJECT:  UAE CENTRAL BANK HOSTS USA PATRIOT ACT SEMINAR 
 
 
1.   SUMMARY:  FINCEN Deputy Director William Baity spoke at 
the UAE Central Bank's November 28 Seminar on the USA 
Patriot Act in front of an audience of about 200 people, 
including UAEG officials and private sector bankers and 
lawyers.  Central Bank Governor Al-Suwaidi asked Baity if 
FINCEN would help organize another FIU training session, 
similar to the training session for South Asian nations that 
the Central Bank and FINCEN co-hosted in June 2004.  They 
agreed to have FINCEN and Central Bank Anti Money Laundering 
and Suspicious Cases Unit staff discuss the details of the 
proposed training.  End Summary. 
 
2. On November 28, The UAE Central Bank hosted a seminar for 
about 200 people on the impact of the USA Patriot Act on 
Banking and Investment Business.  The audience included UAE 
Central Bank officials, representatives from the UAE 
Ministries of Foreign Affairs, Justice, and Interior, and 
the Federal Customs Service.  There was also a strong 
private sector turn out of bankers and lawyers who were 
interested in the topic. 
 
3. The U.S. law firm of Patton Boggs, under contract from 
the Central Bank, conducted the seminar.  FINCEN Deputy 
Director Baity spoke at the conference in response to an 
invitation extended by Central Bank Governor Al-Suwaidi to 
Treasury A/S Zarate for the U.S. Treasury Department to 
provide a speaker.  Central Bank Governor Al-Suwaidi opened 
the conference by noting that the UAE is a major regional 
financial center, processing 53 percent of all received 
SWIFT messages and 40 percent of all sent SWIFT messages for 
the region (Note: SWIFT is an interbank credit-transfer 
system).  For this reason, it was important for banks in the 
UAE (and in the wider Gulf region) to understand the impact 
of the USA Patriot Act.  There was active audience interest 
in the act's impact on banks and financial institutions in 
the region.  The tone of some of the questions reflected 
some regional defensiveness.  For example, some audience 
members asked whether the U.S. viewed the Middle East as the 
main source of terrorist financing and whether the USA 
Patriot Act targeted Arab/Muslin world.  Panel members 
explained that post September 11 investigations did look at 
the flow of funds from the Middle East, but that the focus 
of the USG's anti money laundering efforts was worldwide. 
Audience members also looked for more guidance on how to 
apply "know your customer rules" and on when to report 
suspicious transactions.  Baity stressed that the financial 
institutions needed to undertake their due diligence and to 
know both their customers and the market in order to 
understand what transactions might be suspicious. 
 
4. Central Bank Governor Al-Suwaidi also asked Baity for 
assistance in setting up a follow-on training program to the 
successful June 2004 seminar for South Asian FIUs.  The 
target for this training session would be GCC states and/or 
a broader Arab audience.  Baity stressed that any training 
session needed to target countries at about the same level 
of anti-money laundering/terrorist financing development. 
They agreed that the Central Bank would discuss details with 
FINCEN's regional desk officer. 
 
5. Comment:  The UAE Central Bank continues to play a 
leading role in providing training on anti-money laundering 
and terrorist financing issues.  It also looks to the USG as 
a partner in this effort.  Baity's participation as a 
speaker was very useful in maintaining and improving this 
relationship.  End Comment. 
 
6. Deputy Director Baity has cleared this cable. 
 
SISON