US embassy cable - 05ASUNCION1266

UNCLAS ASUNCION 001266 
 
SIPDIS 
 
EB/ESC/TFS FOR JEAN CLARK 
S/CT FOR TODD KUSHNER 
INL/C/CP FOR STEVEN PETERSON 
IO/PSC FOR BETSY FITZGERALD 
TREASURY/OFAC FOR PAUL LURIE 
 
E.O. 12958: N/A 
TAGS: PTER, KTFN, KVPR, EFIN, ETTC, PREL, PA 
SUBJECT: PARAGUAY: TERRORISM FINANCE COORDINATION OFFICER 
(TFCO) 
 
REF: STATE 175637 
 
Per reftel request, Post provides the following information: 
 
a) Post's TFCO is Kevin M. Johnson, Deputy Chief of Mission 
(office tel. 595-21-213-715 (Ext. 2020); cell tel. 
595-971-914-517;johnsonkm@state.gov). 
 
b) Post's Deputy TFCO is James P. Merz, Political Counselor 
(office tel. 595-21-213-715 (Ext. 2205); cell tel. 
595-971-302-409);merzjp@state.gov). 
 
c)  Post would find it useful for closer coordination -- 
perhaps quarterly meetings or conference calls -- with our 
TFCO counterparts in the region, particularly from Argentina 
and Brazil.  Amembassy Asuncion benefits from the 
participation of Resident Treasury and Justice experts on its 
country team.  We would recommend their participation in 
these meetings together with their counterparts as 
appropriate from the other countries. 
 
d)  The general public, and more specifically, the 
banking/business community, need to develop a better 
appreciation for the importance of combating money laundering 
and stronger reporting of financial transactions.  They need 
to develop an appreciation for clear, concrete regulations as 
a protection against the flow of funds directly to terrorists 
rather than an inconvenience that interferes with the conduct 
of business.  Holding seminars with key leaders in society 
from the government, the legal community, the private sector, 
NGOs, etc., educating participants on the relevance and 
importance of combating terror financing in their own 
communities would help create more political will to adopt 
stronger laws and policies. 
 
e)  Post appreciates Department's appeal for ways Washington 
can make our TF work more effective.  We would request 
consideration be given to the following: 
 
-- Paraguay has proven reluctant to adopting anti-money 
laundering (AML) legislation, a necessary precursor to its 
adoption of CT legislation.  The Embassy raises this message 
frequently on a bilateral basis but it is vital that Paraguay 
also receive the message from the IO community that it needs 
to adopt these laws to meet its international obligations. 
Post requests Department work through USUN to bring more CTC 
pressure to bear upon Paraguay, including by having the CTC 
Director pursue a trip to Paraguay for the purpose of 
assessing its progress on adopting these laws. 
 
-- Brazil, and to a lesser extent Argentina, continue to 
object with increasing intensity to U.S. claims that 
terrorist financing occurs in the Tri-Border Area (TBA) 
absent the U.S. providing proof of such claims.  As 
appropriate, it would be helpful if we could share 
information with the GOB and GOA that establishes the basis 
for the serious concerns we have regarding this matter. 
 
-- Developing a database that provides a snap shot of where 
each country in the world is with regard to meeting its CT 
obligations in the way of appropriate AML and CT legislation. 
 Amembassy Asuncion is understandably interested in the 
status of legislation of countries from WHA. 
 
-- Identifying strong legislation from WHA countries as a 
potential model. 
 
-- Identifying influential political leaders from WHA 
countries -- in particular from the Southern Cone -- prepared 
to raise concern about the lack of progress in adopting AML 
and CT legislation with key GOP leaders. 
 
-- Making AML and CT legislation a consideration for support 
of IFI programs. 
KEANE