US embassy cable - 02ANKARA8851

C O N F I D E N T I A L SECTION 01 OF 02 ANKARA 008851 
 
SIPDIS 
 
 
STATE FOR EB/ESC/ESP, S/CT, EUR/SE 
TREASURY FOR ENFORCEMENT/PROGRAM MANAGER BARRY FULLERTON, 
TASK FORCE ON TERRORIST FINANCING, TREASUR/OFAC 
 
 
E.O. 12958: DECL: 09/02/2006 
TAGS: EFIN, ETTC, PTER, CVIS, TU 
SUBJECT: TERRORIST FINANCING: LEGAL BACKGROUND FOR USG 
INTERAGENCY VISIT DECEMBER 16-19 
 
Classified by Econ Counselor Scot Marciel for reasons 1.5 
(b,d). 
 
 
1.  (C) Summary:  With a new, single party Turkish government 
at the beginning of its tenure, the timing for the December 
16-19 interagency anti-terrorist finance visit is good. 
Senior civil servants in the Ministries of Foreign Affairs 
and Justice support a new law to expedite the GOT's ability 
to react to the UN Sanction Committee's anti-terrorist 
financing lists.  They note that Turkey's ratification of the 
UN Convention on the Suppression of Terrorist Finance should 
require implementing legislation, providing the hook to 
introduce  changes to the existing, somewhat cumbersome 
Council of Ministers decree procedure.  Our Turkish 
counterparts on this issue will look to our guidance and 
expertise, particularly on best practices among EU member 
countries.  Turkey will want to ensure that any new law it 
adopts harmonizes with EU codes and practices.  End Summary. 
 
 
 
 
The Legal Background 
--------------------- 
 
 
2.  (U) There are two ways for the government to freeze 
terrorist financing assets under Turkish law.  First, the 
government can cite  one of several laws on the books which 
criminalize terrorist activities and then resort to judicial 
freezing.  Relevant laws that can be cited include Law 4422 
of 1999, "The Law on the Prevention of Profit-Oriented 
Criminal Organizations," Law 3713 of 1990, "The Anti-Terror 
Law."  The disadvantage of this means is that it requires a 
Ministry of Justice prosecutor to present evidence to a 
security court to obtain a freeze order.  This can be a 
lengthy process uncertain of outcome.  For instance, in the 
case of Yasin al-Kadi, an Istanbul security court denied the 
freeze request based on insufficient evidence.  (The GOT 
later froze al-Kadi's assets using administrative means.) 
 
 
3.  (U)  The second way of freezing terrorist assets is 
through administrative means, which is the way the Turks have 
decided to go.  In December 2001, the Council of Ministers 
issued a decree to react to the UN Sanctions Committee freeze 
lists, translated below.  This decree  authorizes the 
Ministry of Finance (by extension, its Inspection Board) to 
freeze all assets on an attachment.  The problem is that the 
bureaucracy cannot simply attach new lists as they are 
adopted by the UN Sanctions Committee.  The Council of 
Ministers must pass a new decree to adopt each new UN list 
(and each minister must sign every decree).   This can be a 
cumbersome and lengthy process.  Amending the decree, or 
better yet, new legislation, to authorize the Ministry of 
Finance, or some sub-cabinet interagency working group, to 
adopt new lists of names without Cabinet approval may be a 
challenge (though Ministry of Justice officials believe some 
European countries like Belgium may have adopted such a 
practice.) 
 
 
4.  (U) Ministry of Foreign Affairs Deputy DG for 
Intelligence Okcal, and Ministry of Justice Director General 
for International Affairs Kaya have long sought to change the 
GOT procedure for freezing terrorist assets.  They want a 
more expedited procedure, and they believe the rest of the 
bureaucracy supports them (with the possible exception of 
Justice's legislative affairs directorate, below).  They see 
the need to pass a new law to effect such a change, and the 
hook for the new law could be Turkey's ratification in April 
2002 of the UN Convention for the Suppression of Terrorist 
Financing.  After the Turks deposit the instruments of 
ratification with the UN (which hasn't yet happened), then a 
law should be passed to make the operational parts of this 
Convention domestic law, per Okcal and Kaya. 
 
 
5.  (U) The one possible hold-out on the need for a new law 
is the Ministry of Justice's Legislative Affairs directorate. 
  This directorate has the final chop on all draft laws 
submitted by the GOT to the parliament.  This directorate 
interprets Article 90 of the Turkish Constitution (translated 
below in relevant part) to say that generally international 
treaties don't require implementing legislation.  However, if 
international treaties require something specific not already 
called for in Turkish law, then implementing legislation will 
be required.  Thus, an important meeting for the USG 
anti-terrorist financing delegation will be to discuss the 
need for implementing legislation to bring Turkey fully into 
compliance with its treaty commitments under the UN 
Convention on the Suppression of Terrorist Financing. 
 
 
The Opportunity and Challenge of a New Government 
--------------------------------------------- ---- 
 
 
6.  (C) MFA Deputy DG Okcal has told us that while the prior 
coalition government did not put a high priority on a new law 
to expedite terrorist financing freezes, he hopes the 
interagency working group on terrorist financing will try 
again soon with the new GOT.  The positive indication of 
interest in the upcoming USG delegation by the Minister of 
Finance indicates he could well be a supporter. 
 
 
7.  (U) The new government is beginning to replace senior 
civil servants.  Chairman of the Financial Crimes Board 
(MASAK) Necat Coskun has been replaced by Genc Osman Yarasli. 
 Yarasli's bio says he is a former Finance Ministry 
Inspection Board investigator and speaks English. 
Undersecretary of Finance (the ministry's senior civil 
servant position) Ertan Dikmen has moved on, though his 
replacement has not yet been made official.  None of these 
personnel changes to date have affected the issue of 
anti-terrorist financing. 
 
 
8.  (C) The only potentially negative indication of the new 
GOT's position on the issue comes from Cuneyd Zapsu, an 
advisor to AK Party Chairman Erdogan and former business 
partner to Yasin al-Kadi in Istanbul.  Zapsu told us he 
supports al-Kadi's efforts to unfreeze his assets in Turkey 
(about $2 million), and that the GOT had acted illegally 
against al-Kadi.  But this doesn't mean either Zapsu (an 
influential AK member, but not a minister) or others would 
seek to block a new law.  In general, the new government is 
looking for ways to work together with the USG. 
 
 
Translations of Turkish Law 
--------------------------- 
 
 
9.  (U) Following are Embassy translations of a relevant 
Council of Ministers decree and Constitutional Article: 
 
 
-- Council of Ministers Decree of December 2001 
 
 
The Ministry of Finance is authorized to freeze assets of 
terrorist organizations, and real persons and corporate 
bodies which finance terrorist activities, as listed in the 
attachment to this decision, namely the assets held in banks 
and other financial institutions, including rented safety 
deposit boxes in these institutions, and all related 
transactions in connection with these assets.  This is in 
conformity with the decision of the UNSCs 1267 of 1999, 1333 
of 2000 and 1373 of 2001.  Its implementation must be obeyed 
by all member countries, according to Article 25 of the 
United Nations Convention, ratified under Turkish Law No. 
4801 of August 15 of 1945, and implemented according to 
Article 90 of the Constitution of the Turkish Republic.  This 
decision is issued by the Council of Ministers on December 
22, 2001, upon the written request of the Ministry of Foreign 
Affairs dated December 11, 2001. 
 
 
-- Turkish Constitution, Article 90, 
Ratification of International Treaties 
 
 
The ratification of treaties concluded with foreign states 
and international organizations on behalf of the Turkish 
Republic shall be subject to adoption by the Turkish Grand 
National Assembly by a law approving 
ratification....International agreements duly put into effect 
carry the force of law. 
PEARSON