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S E C R E T RIYADH 000228 
 
NOFORN 
SIPDIS 
 
TREASURY FOR D/S NEAL WOLIN 
 
E.O. 12958: DECL: 02/27/2020 
TAGS: ECON PREL EFIN KTFN SA
SUBJECT: TREASURY D/S WOLIN DISCUSSES ILLICIT FINANCE AND 
IRAN PRESSURE TRACK IN SAUDI ARABIA 
 
Classified By: Ambassador James B. Smith for reasons 1.4(b), (c), and ( 
d) 
 
¶1. (S/NF) Summary:  On February 13-14, Treasury Deputy 
Secretary Neal Wolin visited Saudi Arabia, discussing illicit 
finance and Iran policy issues with Assistant Minister of 
Interior HRH Prince Muhammad bin Naif bin Abdulaziz Al Saud 
(MBN), Minister of Finance Ibrahim Al Assaf, and Saudi 
Arabian Monetary Agency (SAMA) Governor Muhammad Al Jasser. 
MBN and Wolin reviewed U.S.-Saudi cooperation to combat 
terrorist financing.  Assaf and Jasser sought resolution on 
conflicts pertaining to Saudi Arabia's mutual evaluation 
drafted by the Financial Action Task Force/Middle East North 
Africa Financial Action Task Force (FATF/MENAFATF).  End 
summary. 
 
Combating the Financing of Terrorism 
------------------------------------- 
¶2. (S/NF) Wolin thanked MBN for his leadership and continued 
cooperation with the Treasury Department and GPRO to combat 
terrorist financing.  MBN said that there is "no alternative" 
to cooperation on this issue, and stressed there is always 
room for improvement.  When asked about recent 
information-sharing efforts on Taliban Finance, MBN said the 
issue was very important and Saudi Arabia would continue to 
look for new ways to combat Taliban financing.  He 
underscored the complexity of the issue for the Ministry of 
Interior (MOI), with over ten million people coming to Saudi 
Arabia each year for Hajj, including one million from 
Pakistan, and with 2.5 million South Asians working in the 
Kingdom.  The MOI monitors these individuals as they can, 
especially during Hajj and Umrah.  He said the Saudi 
government (SAG) cannot deny entry of individuals into the 
Kingdom for Hajj and Umrah unless they pose a direct threat 
to Saudi Arabia's security.  He cited an example of a 
six-hour deliberation over a possible entry request by Saddam 
Hussein during Iraq's invasion of Kuwait, which the SAG 
ultimately decided they could not deny. Wolin acknowledged 
the complexity of the problem, and stressed the importance of 
continued information-sharing on terrorist financing 
emanating from the Kingdom, particularly with respect to the 
Taliban and other Af/Pak-based groups. 
 
¶3. (SBU) Regarding the Saudi-U.S. relationship generally, MBN 
emphasized the strength of our shared mutual interests and 
the importance of increasing mutual understanding between our 
nations.  He stated that the 9/11 attacks were aimed both at 
the United States and at Saudi Arabia since, by using Saudi 
hijackers, Al Qaida sought to sow discord between the two 
nations. 
 
Deterrence 
----------- 
¶4. (S/NF) Turning to public deterrence, Wolin underscored the 
importance of continuing to publicize the details of 
terrorist prosecutions to maximize their deterrent effect. 
MBN stressed the importance of striking the right balance so 
as not to create heroes. He stated that it is sometimes 
effective to highlight behavior that will be seen by the 
population as criminal or corrupt. As an example, he cited 
the recent case of an individual who was selling false 
coupons for the Hajj and using the funds to support extremist 
activities. 
 
¶5. (S/NF) MBN raised the legal case against Aqil Al Aqil, the 
former director of Al Haramain in Saudi Arabia, who was 
detained in 2009 by the MOI and is being held on a number of 
criminal charges, including extortion.  MBN stated Aqil's 
confessions surprised them, and the progress made in the 
criminal case against Aqil has given the MOI strength to "go 
after others like him."  MOI was able to uncover money he put 
in the name of his sons and others.  Aqil has been anxious to 
avoid terrorist financing charges, according to MBN. 
 
¶6. (S/NF) MBN gave other examples of individuals who would be 
investigated on terrorist financing charges, including a 
Pakistani driver was stopped last week with SAR 900,000 
behind the driver's seat.  MBN said people are waiting to 
hear the name of the person who is detained, which will be 
leaked.  MBN noted all stopped for such a violation would be 
investigated for terrorist financing.  On a related note, 
Wolin stated that during his trip to Afghanistan, officials 
there expressed concern over bulk Saudi Riyals coming over 
 
the Afghan border. MBN replied it was important to uncover 
from where the money was originating. 
 
Yemen and Iraq 
--------------- 
¶7. (S/NF) MBN raised Yemen with Wolin, stating that in Yemen 
"they work in cash and check."  He said money comes to Yemen 
from all over the world.  MBN raised concern over Al Qaida 
leadership figures in Yemen and the ability of individuals to 
move from Yemen to Mecca, and vice versa for training.  MBN 
was concerned about this issue vis-a-vis the large number of 
American Muslims who travel to Saudi Arabia for the Hajj and 
Umrah, noting that people traveling to Saudi Arabia for Hajj 
or Umrah may slip across the porous border into Yemen.  The 
MOI would do what it could to prevent this, to protect both 
Saudi and U.S. interests. 
 
¶8. (S/NF) MBN also discussed Saudi plans for sealing its 
northern border with Iraq, which is 40% complete.  He 
believed it important to convince the U.S. that the border 
should be sealed, describing the project as an "up-front 
investment that would pay over time."  (Note:  The SAG is 
also in the initial stages of building a border fence along 
Saudi Arabia's southern border with with Yemen.  The essence 
of both border projects is to stop illicit trafficking of 
humans, narcotics, and funding.  End note.) 
 
FATF/MENAFATF Mutual Evaluation 
-------------------------------- 
¶9. (S/NF) Both Finance Minister Assaf and SAMA Governor 
Jasser raised concerns with the FATF/MENAFATF draft mutual 
evaluation.  Assaf said he shared his disappointment with the 
draft report with Secretary Geithner during his July visit. 
Given the policies and rules Saudi Arabia has put in place, 
Assaf was surprised by its negative tone.  He was hopeful the 
U.S. could be helpful with this issue.  During a private 
conversation between Wolin and Jasser in Jeddah, 
Jasser raised the same concerns.  Jasser noted the report 
made negative comments about Shariah law.  Jasser shared 
Saudi suspicions that the draft report was "ghost written," 
since, in their view, the evaluation team did not ask 
in-depth questions during its visit in February 2009.  He 
said the SAG team had answered the questions asked of them, 
but the rationale for non-compliance was not adequately 
explained to them.  (Note:  In February 2009, a joint 
FATF/MENAFATF evaluation team conducted an onsite evaluation 
of Saudi Arabia's institutions responsible for anti-money 
laundering and combating the financing of terrorism 
(AML/CFT).  The draft mutual evaluation has not yet been 
released.  End note.) 
 
¶10. (S/NF) Wolin stated that the FATF is an independent 
international body and that USG views, either positive or 
negative, are not a component of the report. Wolin assured 
both Assaf and Jasser that where the U.S. Treasury Department 
has concerns about Saudi Arabia's AML/CFT regime, we deal 
with the SAG directly and with openness.  Wolin pledged to 
review the FATF matter with other Treasury officials with the 
goal of facilitating constructive discussions between FATF 
and the SAG. 
 
Iran 
----- 
¶11. (S/NF) With both Assaf and MBN, Wolin reviewed USG policy 
with respect to Iran and its nuclear program.  Wolin noted 
the failed attempts to reach a resolution through diplomatic 
efforts, and the need, therefore, to increase pressure on the 
Iranian regime.  He described the increasing role of the 
Iranian Revolutionary Guard Corps (IRGC) in the Iranian 
economy and pointed to recent Treasury designations targeting 
the IRGC's illicit activity.  He sought the SAG's partnership 
in combating this financial activity and asked the SAG to 
play a leadership role within the GCC to encourage additional 
measures with its Gulf neighbors. 
 
¶12. (S/NF) Assaf said he would be pleased to talk with 
neighbors in the Gulf, but said every country in the Gulf 
looks at the issue of Iran differently.  Assaf said the SAG 
has spoken with its banks regarding concerns over Iran, and 
noted that most financial transactions with Iran were in 
Dubai. MBN stated that he shared our concerns regarding Iran, 
but that the UAE could do more than Saudi Arabia to increase 
pressure on Iran.  He stated that he wanted "our friends in 
 
the UAE to be more aggressive." 
 
¶13. (S/NF) Regarding information-sharing on financial 
activity, Assaf noted that only a few Saudi banks do business 
with Iran, and those that do have very limited activity for 
Iranians traveling to Saudi Arabia for the Hajj and Umrah, an 
area where the SAG needed to be careful.  He further 
requested that any information of concern on banking activity 
in Saudi Arabia should be provided through intelligence 
channels so it could then be investigated and then 
deliberated by the Permanent Committee on Combating Terrorism 
(PCTC).  (Note:  The PCTC is an interagency body in Saudi 
Arabia that evaluates counterterrorism issues, including 
terrorist financing issues such as UN listings.  End note.) 
 
¶14. (U) This cable was cleared by D/S Wolin. 
SMITH