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Diana T Fritz  08/27/2006 05:52:57 PM  From  DB/Inbox:  Search Results

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S E C R E T        ABU DHABI 04592

SIPDIS
CXABU:
    ACTION: ECON
    INFO:   AMB DOJ DCM LEGAT POL P/M

DISSEMINATION: ECON
CHARGE: PROG

APPROVED: DCM:MQUINN
DRAFTED: ECON:AECURTIS
CLEARED: ECON:OJOHN, ICE:WWALLRAPP, CG:JDAVIS

VZCZCADI036
RR RUEHC RUEHZM RUEATRS
DE RUEHAD #4592/01 3131334
ZNY SSSSS ZZH
R 091334Z NOV 05
FM AMEMBASSY ABU DHABI
TO RUEHC/SECSTATE WASHDC 2285
INFO RUEHZM/GULF COOPERATION COUNCIL COLLECTIVE
RUEATRS/DEPT OF TREASURY WASHINGTON DC

S E C R E T SECTION 01 OF 02 ABU DHABI 004592 
 
SIPDIS 
 
STATE FOR NEA/ARPI RSMYTH, EB/ESC/TFS FOR DNELSON, JSALOOM, 
JUNDERRINER, S/CT TKUSHNER, 
NSC FOR ZARATE, HERRING, RUPERT 
TREASURY FOR GLASER, MURDEN, HEFFERNAN 
MANAMA FOR BEAL 
 
E.O. 12958: DECL: 11/09/2015 
TAGS: PTER KTFN EFIN ETTC AE
SUBJECT: ASSESSMENT OF CASH COURIER ENVIRONMENT IN THE UAE 
 
REF: TREASURY 011853Z 
 
Classified By: Ambassador Michele J. Sison for reasons 1.5 (b) and (d). 
 
 
¶1. (S) Summary.  The UAE is a largely cash-based society, and 
the importation of large sums of cash is not frowned upon. 
In fact, the UAE tends to regard Westerners bringing in large 
sums of cash as good for the country's economy, and we note 
that it is common for people here to carry large amounts of 
cash.  Although the UAE has legal authorities in place that 
require declaring imported cash, the requirement is not 
strictly enforced.  Even when cash is declared or discovered, 
police and customs authorities do not necessarily 
investigate.  The U.S. has provided training to customs and 
police officials on bulk cash smuggling, and Embassy officers 
and Washington officials have discussed the problem of cash 
couriers with UAEG officials on multiple occasions.  End 
summary. 
 
¶2. (U) In response to reftel, following is Embassy's 
assessment of the cash courier environment in the UAE. 
 
At the Border and the Legal Environment 
--------------------------------------- 
 
¶3. (S) UAE law specifically requires cash in excess of 
$10,800 be declared when it is brought into the country, and 
the Central Bank is in the process of revising the law to 
also require the declaration of exported cash in excess of 
$10,800.  Although the UAE has an import declaration 
requirement, it is not well publicized or enforced.  Customs 
officials have told Embassy officers on multiple occasions 
that they do not view cash imports as problematic and that 
they do not want to discourage people from bringing money 
into the country.  If customs officials discover someone 
carrying undeclared cash, they are asked to declare the 
money, but customs officials tell us they do not necessarily 
consider it worth investigating further.  Emiratis themselves 
(and Middle Easterners in general) are accustomed to carrying 
large amounts of cash on their persons, and this may be one 
reason for the lack of concern on the part of the customs 
officers.  As a senior customs official told an Embassy 
officer, "But he might be a businessman using the money for 
legitimate purposes."  Thus, the requirement to report cash 
only creates a record of its movement, and UAE authorities 
might not use the information to begin an investigation. 
Although the customs officials do have a laissez-faire 
attitude, this should not be mistaken for corruption.  The 
customs officials in Dubai and the rest of the UAE are not 
typically perceived to be corrupt. 
 
¶4. (S) Although customs officials do share some information 
with law enforcement and Central Bank officials, 
communication is informal and often ad-hoc.  According to 
documents from the Central Bank, customs officials only 
submitted 111 suspicious transaction reports (STRs) to the 
UAE's FIU, the Anti-Money Laundering and Suspicious Cases 
Unit (AMLSCU) between December 2000 and January 2005.  The 
UAE is aware that large sums of cash coming from India and 
Pakistan.  In one instance, Dubai Police arrested an Indian 
man who had taken multiple trips to and from India allegedly 
smuggling the proceeds of illegal activity, and the case is 
pending prosecution. 
 
¶5. (C) Article 6 of the UAE's Anti-Money Laundering law 
authorizes the Central Bank to establish a ceiling for the 
amount of currency that can be brought into the country, and 
Article 18 authorizes a fine of $545 to $2,700 for 
violations.  Additionally, the Central Bank regulation that 
set the $10,800 ceiling for cash imports states, "In case no 
declaration was made and cash amounts exceeding the said 
ceiling were detected, the customs officer in charge should 
inquire about the reasons for not declaring.  If the said 
officer found the reasons unconvincing, he should seize and 
transfer the amount to the Attorney General to initiate legal 
proceedings against the concerned person." 
 
The Political Environment 
------------------------- 
 
¶6. (C) The UAE Central Bank has reviewed FATF Special 
Recommendation IX on cash couriers, and it was discussed 
during a December 2004 meeting of the National Anti-Money 
Laundering Committee, which included UAE customs officials. 
It was also discussed during a UAE-sponsored GCC-EU Seminar 
on Combating Terrorist Finance held in March of 2004. 
Washington visitors -- including Homeland Security Advisor 
Fran Townsend -- have engaged Central Bank, law enforcement, 
and security service officials in Abu Dhabi and Dubai on the 
problem of cash couriers using the UAE to transit funds. 
Although the senior-level leaders all note that the problem 
of cash couriers is a concern, we have not seen this 
awareness translate to a concentrated effort on the part of 
the customs officers to try to address the situation. 
 
USG Assistance 
-------------- 
 
¶7. (C) In September of 2005, DHS/ICE provided training to 
Dubai Police and Customs officials on detecting and 
investigating bulk cash smuggling cases.  Although Customs 
Officials did not request additional training, they would 
likely welcome it.  We note, however, that they have not made 
changes in their procedures or practices since the September 
training.  As a travel hub for the region that is easy to 
transit, Embassy is concerned that a significant amount of 
currency smuggling goes through Dubai.  Abu Dhabi and the 
rest of the emirates are not as much of concern.  As such, 
the USG has focused most of its training and enforcement 
efforts on Dubai Customs and Police.  The UAE Federal Customs 
Authority has virtually no authority or capabilities in the 
UAE. 
 
The Strategic Picture 
--------------------- 
 
¶8. (C) Embassy agrees that all elements listed in para 6 
reftel are essential for combating terrorists' use of cash 
couriers.  However, we note that first and foremost, the host 
nation needs to enforce its laws and investigate suspected 
individuals aggressively.  The UAE has all the right laws in 
place, but enforcement is still weak. 
SISON