US embassy cable - 05GUATEMALA2685

UNCLAS GUATEMALA 002685 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR EB/ESC/TFS, S/CT, INL/C, IO/PHO; TREASURY FOR 
MAUREEN WAFER, NAN DONNELS, KATIE KLINGENSMITH, OFAC AND 
FINCEN; JUSTICE FOR SARAH MCCREADY 
 
E.O. 12958: N/A 
TAGS: KTFN, KVPR, EFIN, PTER, ETTC, PREL, SNAR, GT 
SUBJECT: TERRORISM FINANCE IMPLEMENTING REGULATIONS COVER 
REMITTANCES 
 
REF: GUATEMALA 2093 
 
1.  (SBU) Guatemala's Financial Intelligence Unit (IVE) 
proposed implementing regulations for the recently passed 
terrorism finance legislation.  The regulations will need to 
be approved by the monetary board before implementation.  In 
advance of this submission, the IVE consulted EconOff and 
provided a draft copy.  The IVE sought USG input on new 
requirements affecting wire transfers and remittances, as the 
US is the source of almost all of Guatemala's nearly $3 
billion in annual remittances.  Preliminary copies of the 
regulations are available from Tom Palaia at 
PalaiaT@State.gov or 502-2326-4632.  The legislation itself 
is available in English from the Superintendency of Banks at 
their web-site: www.sib.gob.gt. 
 
2.  (SBU) In consultation with US Treasury, Post advised the 
IVE on applicable US standards and new Financial Action Task 
Force (FATF) recommendations, which were incorporated in the 
draft regulations.  The regulations require that companies 
facilitating money transfers in Guatemala, equal to or in 
excess of $1000, must request that the transfer include the 
name, address, and date and place of birth of the 
transaction's originator.  If this information is not 
provided, they are required to "pay special attention" to the 
transaction, a preliminary step, short of finding a 
transaction "suspicious", which triggers reporting 
requirements.  The remittance facilitator must also ask the 
end recipient for similar information.  Collection of 
recipient information goes beyond FATF recommendations but 
the IVE included this requirement to improve their 
investigative capabilities.  The regulations do not specify 
any requirements as to what type of ID or standard must be 
applied by the remitter or transfer source, as this part of 
the transaction normally occurs outside of Guatemala.  The 
$1000 amount is low enough to comply with new FATF 
guidelines, yet high enough that it should not affect normal 
remittance flows, thus avoiding the unintended consequence of 
driving remitters away from the formal sector, further 
complicating potential regulation and investigation. 
WHARTON