VZCZCXRO6659
PP RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHGP #2443/01 2130901
ZNY SSSSS ZZH
P 010901Z AUG 06
FM AMEMBASSY SINGAPORE
TO RUEHC/SECSTATE WASHDC PRIORITY 0750
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY
INFO RUCNASE/ASEAN MEMBER COLLECTIVE
RUEHHI/AMEMBASSY HANOI 1358
RUEHUL/AMEMBASSY SEOUL 3910
RUEHKO/AMEMBASSY TOKYO 5425
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEAWJA/DEPT OF JUSTICE WASHDC
RUEANQT/FINCEN VIENNA VA
RUEKJCS/SECDEF WASHDC
RHEHAAA/WHITE HOUSE WASHDC
RUEAIIA/CIA WASHDC

S E C R E T SECTION 01 OF 02 SINGAPORE 002443 
 
SIPDIS 
 
NOFORN 
SIPDIS 
 
STATE PASS TREASURY FOR UNDER SECRETARY LEVEY 
 
E.O. 12958: DECL: AFTER KOREAN REUNIFICATION 
TAGS: EFIN KTFN ETTC PREL PRTER PARM KCRM SN KN
SUBJECT: TREASURY U/S LEVEY DISCUSSES CONTINUING DPRK 
FINANCIAL ACTIVITY IN SINGAPORE 
 
REF: 05 SINGAPORE 3187 
 
Classified By: Charge d'Affaires Judith R. Fergin for reasons 1.4(b) an 
d (d) 
 
¶1.  (S) Summary: Treasury Under Secretary for Terrorism and 
Financial Intelligence Stuart Levey raised USG concerns 
regarding continued North Korean (DPRK) financial activity -- 
specifically related to WMD proliferation and Tanchon 
Commercial Bank -- in Singapore during separate July 21 
meetings with Government of Singapore and United Overseas 
Bank (UOB) officials and urged them to freeze any 
DPRK-associated accounts as required by the newly passed UN 
Security Council Resolution 1695.  GOS and UOB officials said 
they had taken steps to monitor and shut down DPRK activity 
in Singapore.  They reiterated support for U.S. efforts and 
expressed willingness to cooperate with the United States and 
to comply with the UN to the extent Singapore law allows. 
Both GOS and UOB asked the USG to pass them any information 
regarding DPRK endeavors in Singapore.  End summary. 
 
DPRK's Continued Efforts to Penetrate Singapore 
--------------------------------------------- -- 
 
¶2.  (S) In a meeting with Vivien Chan, UOB's Senior Vice 
President for Compliance, U/S Levey asked about action taken 
since his last visit (reftel).  He acknowledged the 
responsible decisions Singapore banks had already made with 
respect to DPRK-related financial activity, specifically 
those entities designated by the U.S. under Executive Order 
13382, such as Tanchon Commercial Bank.  He raised USG 
concerns that the DPRK may be becoming more aggressive in its 
attempts to infiltrate Singapore banks through accounts 
linked to individuals rather than linked to entities such as 
Tanchon Commercial Bank specifically.  Singapore was a 
natural target for the DPRK, and the USG wanted to ensure 
that banks such as UOB retain the strongest controls 
possible.  This was especially true, he continued, given 
Singapore,s regional financial leadership, the strength of 
UOB itself, and the fact that the U.S. Federal Reserve had an 
existing ECI contract with UOB.  Without divulging specifics 
or naming UOB, U/S Levey told Chan that the DPRK might be 
trying to regain/sustain a foothold in Singapore to 
facilitate its activities and that the U.S. was concerned 
that some of this activity was linked to WMD proliferation. 
Turning to the UN Security Council Resolution 1695, he 
reminded Chan that closing accounts and returning funds was 
no longer sufficient.  He shared with her the text of the new 
resolution, citing that it called on states to prevent the 
transfer of any financial resources to DPRK WMD and missile 
programs, and that UOB would need to freeze assets in 
accounts linked to the DPRK's missile program.  He noted that 
would apply to any Tanchon-related accounts.  The USG's 
concern could not be overstated, and the USG,s policy was to 
ensure that DPRK WMD-related entities were blocked out of all 
financial institutions worldwide, he concluded. 
 
¶3.  (S) UOB's Chan reported that the bank closed all 
DPRK-related accounts in November 2005; it no longer 
maintained relationships with any DPRK entity or individual 
as far as the bank was aware.  Because closing accounts was 
complicated, UOB had increased due diligence efforts in order 
to prevent the DPRK from opening accounts in the first place, 
she said.  Highlighting the extent of the bank's efforts, 
Chan said that UOB's policies now occasionally go beyond what 
was mandated by Singapore law.  Chan said UOB's current 
challenge was reviewing long-standing accounts to ensure they 
were not connected to the DPRK, and their fear was that 
non-DPRK entities and individuals may try to facilitate 
DPRK-related activity through their account relationships 
with UOB.  She reiterated that all DPRK business was 
disallowed at the bank.  In closing, Chan asked that the 
United States be more forthcoming with information sharing 
directly to UOB, and cited the U.K. as particularly helpful 
in this area. 
 
Singapore Willing to Help; Challenges Remain 
-------------------------------------------- 
 
SINGAPORE 00002443  002 OF 002 
 
 
 
¶4.  (S/NF) At a luncheon hosted by the Charge d'Affaires, U/S 
Levey explained to representatives of the Ministry of Foreign 
Affairs (MFA), the Monetary Authority of Singapore (MAS), and 
the Ministry of Home Affairs (MHA) that his current trip 
focused on DPRK and, to a lesser extent, Iran, and the 
importance of ensuring illicit activity, especially WMD 
proliferation, was blocked out of financial sectors in Asia. 
He thanked MFA Permanent Secretary Peter Ho for the 
Ministry's strong condemnation of the DPRK missile tests, and 
said he wished to share the USG's continuing concerns, 
especially in light of UN Security Council Resolution 1695. 
He expressed concern that Tanchon Commercial Bank sought to 
penetrate Singapore financial institutions, and that Song 
To-il, a DPRK national and Tanchon,s representative in the 
region, may be utilizing his accounts and financial 
relationships in Singapore to facilitate such business.  The 
Singapore officals asked if this information was relayed to 
UOB directly, U/S Levey replied that he had not given the 
information to the bank because he was only authorized to 
release the information to the Singapore government.  With 
regard to acting on Resolution 1695, U/S Levey said that he 
did not believe there was any dispute that Tanchon Commercial 
Bank was directly linked to the DPRK's missile program, 
acting as the primary financial arm of that program.  U/S 
Levey also asked if there had been any increase in Iranian 
financial activity in Singapore, which Singapore officials 
said was minimal. 
 
¶5.  (S) Both MFA's Ho and MAS Deputy Managing Director Teo 
Swee Lian thanked U/S Levey for the information and asked 
that he share any more details about Song To-il and his 
activities in Singapore.  They said Singapore was willing to 
act but first needed evidence to take direct action -- such 
as freezing assets -- in order to comply with Singapore law. 
Ho and Teo also expressed frustration that the USG was unable 
to release Song To-il's name directly to UOB officials.  Ho 
and Teo said they were not aware of any Iranian activity in 
Singapore.  It was difficult for Iran to operate here, as it 
had no bank branches and Singapore would not allow it to 
establish an embassy for security reasons, Ho said. 
 
¶6.  (U) U/S Levey cleared this message. 
FERGIN