US embassy cable - 05KUWAIT1730

C O N F I D E N T I A L SECTION 01 OF 02 KUWAIT 001730 
 
SIPDIS 
 
EB/ESC/TFS MSIDDIQUI, S/CT TKUSHNER, NEA/ELA DBARON 
NEA/ARPI TWILLIAMS, NEA/I-ECON K. BRONSON, IO/PSC 
JSCHWEITZER 
NSC FOR JKEMERSON 
TREASURY FOR JZARATE, OFAC RWERNER 
MANAMA FOR JBEAL 
TREASURY FOR DGLASER, RLEBENSON, MEPSTEIN 
 
E.O. 12958: DECL: 04/20/2015 
TAGS: EFIN, PTER, KTFN, KU 
SUBJECT: CHARITIES IN KUWAIT: TREASURY DAS DISCUSSES 
KUWAIT'S STRONGER ENFORCEMENT OF CHARITABLE CONTRIBUTION 
LAWS 
 
Classified By: Ambassador Richard LeBaron for reasons 1.4(b) and (d) 
 
1.  (C) SUMMARY: On April 16, 2005, Treasury DAS Glaser met 
with a Ministry of Social Affairs and Labor official to 
discuss how charitable contributions in Kuwait can be made, 
collected and transferred, and the methods the GOK uses to 
track and prevent the abuse of charitable contributions for 
terrorist financing.  In an effort to circumvent the new 
restrictions on charities, creative new methods for 
collections are being used.  The Ministry of Social Affairs 
admits that countering these new methods is a challenge 
because the GOK has a shortage of experience with prosecuting 
money-laundering crimes.  END SUMMARY. 
 
2.  (C) Visiting Treasury DAS Daniel Glaser, accompanied by 
the OFAC regional attach and representatives from the 
Treasury Department's Office of Terrorist Finance and 
Financial Crimes and the Office of Intelligence and Analysis, 
met on April 16 with Mr. Adnan al-Omar, Assistant 
Undersecretary of Social Development in the Ministry of 
Social Affairs and Labor.  Al-Omar is responsible for the 
Charities Department within the Ministry. 
 
3.  (C) DAS Glaser asked about the GOK's recent decision to 
remove unlicensed charitable cash collection kiosks and boxes 
throughout Kuwait.  Al-Omar explained that a Charitable 
Oversight Committee had been formed to address the concerns 
that the GOK has with illegal charitable collections.  The 
Committee is comprised of representatives from the Ministries 
of Social Affairs, Interior, Finance, Islamic Affairs and the 
Central Bank.  With the full support of the Council of 
Ministers, the Committee agreed to the forcible removal of 
all unregistered charity "cash-boxes" in Kuwait, al-Omar 
said.  He explained that the unprecedented terrorist attacks 
that took place in Kuwait at the beginning of 2005 have 
awakened the GOK to the seriousness of the threat that 
terrorism poses to the country.  The removal of these charity 
boxes is a reactive step that the GOK is taking in an effort 
to curtail one source of support to the extremists in Kuwait, 
al-Omar said. 
 
4.  (C) The challenge, al-Omar continued, is that as soon as 
one charity cash-box is taken down, more are put up.  He also 
said that new methods of collections are being used.  As 
examples, he cited (a) a door-to-door cash-collecting system 
using small fast-food type delivery trucks and (b) collecting 
clothing for charity, then using the money gained by selling 
the clothes to fund illegal activities.  The Ministry of the 
Interior is currently working with the Charities Department 
to identify the owners of the trucks in an effort to trace 
the illegal collections, he said.  However, no solution has 
been identified to stop the clothing collection.  He 
explained that the goal is to identify the charities 
accepting illegal donations and to track them, rather than 
"provoke them into going underground," by taking stronger 
initial actions against them. 
 
5.  (C) Prior to the kiosk-removal crackdown on charities, 
al-Omar said, it was easy to follow the known routes for the 
disbursements of charitable collections.  Now, he said, the 
channels have changed in response to the government's actions 
and it's "impossible" to track all the new routes.  Once the 
money leaves Kuwait, he added, there is no easy way to track 
where it goes. (Note: During the MENA FATF plenary attended 
by DAS Glaser in Bahrain prior to his visit to Kuwait, the 
Kuwaiti delegate and Head of Supervision at the Central Bank 
of Kuwait mentioned that Kuwait tries to follow the money 
through its embassies abroad. End Note).  The Charities 
Department has little experience in detecting 
money-laundering, for example, and al-Omar said that the GOK 
could use more support from experienced sources to address 
this problem. 
 
6.  (C) DAS Glaser also asked about three known charities of 
concern to the U.S Treasury Department that are registered in 
Kuwait: the Social Reform Society (SRS), the Revival of 
Islamic Heritage Society (RIHS), and Al-Najat.  (Note: 
Al-Najat, or Rescue, is the parent organization of the 
Patients Helping Fund and the African Muslim Agency, also 
know as Direct Aid Society. End Note).  Al-Omar replied that 
the Charities Department was also concerned about these 
charities and kept a close watch over their transactions. 
One of the main concerns about these charities, he added, is 
that numerous unlicensed subcommittees are created under the 
original licensed charity's name and that these subcommittees 
are the source of much of the illegal activities with the 
charity.  (Note: The U.S. Treasury Department has designated 
two such subcommittees for supporting al Qaida - RIHS' Afghan 
Support Committee and SRS' Lajnat al Dawa al Islamiya. End 
Note).  He clarified this by saying that no charities are 
allowed to transfer funds outside of Kuwait without the 
permission of the Ministry of Social Affairs and that they 
have not given these three charities that permission.  In a 
very candid exchange, al-Omar said that his preference would 
be to "dissolve" one of these questionable charities to serve 
as an example to all.  However, he said, the decision to 
dissolve a charity would be a political decision made at the 
Ministerial level.  Al-Omar was not optimistic that the 
Charitable Oversight Committee would allow this to happen due 
to political pressures within the GOK. 
 
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Visit Embassy Kuwait's Classified Website: 
http://www.state.sgov.gov/p/nea/kuwait/ 
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LEBARON