VZCZCXRO9162
RR RUEHDE
DE RUEHAD #3872/01 2770840
ZNR UUUUU ZZH
R 040840Z OCT 06
FM AMEMBASSY ABU DHABI
TO RUEHC/SECSTATE WASHDC 7218
INFO RHEHNSC/NSC WASHDC
RHMFIUU/DEPT OF HOMELAND SECURITY WASHDC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUEHZM/GULF COOPERATION COUNCIL COLLECTIVE

UNCLAS SECTION 01 OF 03 ABU DHABI 003872 
 
SIPDIS 
 
DEPT FOR NEA/ARP, EB/ESC/TFS 
TREASURY FOR A/S O'BRIEN, PHEFFERNAN, ACURTIS 
DHS FOR DHS/ICE, FINANCIAL AND TRADE INVESTIGATIONS 
NSC FOR JZARATE 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PTER KTFN AE
SUBJECT: DRAFT UAE-U.S. "GAP ANALYSIS" OF CASH COURIER REGULATIONS 
 
Refs: A) Abu Dhabi 3818, B) Abu Dhabi 2421, C) 2003 Abu Dhabi 2211 
 
¶1. (U) In response to the Central Bank Governor's request at the 
September 12 JTFCC for a "gap analysis" of the U.S. and UAE cash 
reporting regulations and procedures, Embassy/CG interagency team 
(State/Econ, Treasury/OFAC, DHS/ICE) prepared the following draft 
and passed to the UAE Central Bank for comment on September 26.  The 
initial response from the Central Bank was positive, with no 
comments.  We are trying to clarify whether Central Bank officials 
have passed the analysis to the Governor.  In conducting the 
analysis, we noted two gaps between our respective regulations: One, 
UAE regulations do not provide for cash declarations departing the 
country; two, UAE regulations only cover cash and travelers checks, 
not all bearer negotiable monetary instruments.  Central Bank 
officials noted that the UAE does not have the broad range of 
negotiable monetary instruments that the U.S. does. 
 
Begin Text of Gap Analysis and Best Practices 
U.S. - UAE Cash Courier Gap Analysis of Regulations 
--------------------------------------------- ------ 
 
U.S. Law and Regulations (PL 97-258, 31 USC 5311, et sec as 
amended) 
--------------------------------------------- --------- 
 
-- Import and export of any amount of currency permitted. 
-- Must declare currency and monetary instruments transported in and 
out of U.S. in excess of $10,000 or foreign equivalent. 
 
UAE Law and Regulations (Under Provisions of Federal Law No. (4) of 
2002) 
--------------------------------------------- ------- 
 
-- Import and export of any amount of currency permitted. 
-- 40,000 Dirham's (or equivalent) must be declared on importation. 
(cash and travelers checks) 
-- No requirement to declare on export 
 
Gaps in Regulations 
------------------- 
 
-- Current regulations do not require travelers to declare currency 
or monetary instruments on departure from UAE. 
-- UAE regulations cover cash and travelers checks.  U.S. 
regulations cover bearer negotiable instruments (for example: cash, 
travelers checks, bearer bonds, 3rd party endorsed checks, etc.) 
 
Implementation 
-------------- 
 
-- It is premature to provide an assessment of potential gaps in 
implementation of cash courier regulations prior to engaging in the 
proposed cash courier operation. 
 
Best Practices Per FATF Special Recommendation Number IX 
--------------------------------------------- --------- 
 
-- Countries should develop effective and feasible procedures to 
detect, stop, restrain, and where appropriate, confiscate such 
currency and bearer negotiable instruments. Countries are encouraged 
to coordinate these operations with all relevant law enforcement 
authorities. 
 
-- Countries are encouraged to base targeting efforts upon 
intelligence and analysis together with risk and threat assessments. 
Authorities must first identify travel routes, flights, ships and 
concealment methods that are considered high-risk because of known 
or possible links to terrorist financing or other illicit finance 
movement. 
 
-- Most inspections, detections and seizures result from an initial 
"document review" process. 
 
-- Analysis of identification and travel documentation includes the 
following: passport, visa, airline/cruise ticket, and declaration or 
suspicious disclosure documentation. For cargo examinations, ensure 
that some or all of the following shipping documents are made 
available for review: manifest, airway bill, shipper's export 
declaration and invoice/packing list. 
 
-- When a false declaration or false disclosure occurs, or when 
there are reasonable grounds for suspicion of money laundering or 
terrorist financing, and if a person is unable to demonstrate the 
legitimate origin and destination of the currency or bearer 
 
ABU DHABI 00003872  002 OF 003 
 
 
negotiable instruments, those funds may be stopped or restrained. 
Countries may consider confiscation of currency or bearer negotiable 
instruments without criminal conviction in a manner consistent with 
FATF Recommendation 3. 
 
-- Countries should consider establishing procedures to conduct 
thorough inspections of passengers, vehicles, cargo, etc. when it is 
suspected that currency and bearer negotiable instruments may be 
falsely declared or undisclosed or that it may be related to 
terrorist financing or money laundering. If possible, inspections 
should be conducted by a minimum of two individuals. As stated 
earlier, the use of X-ray equipment, scanners and canine units that 
are specially trained to sniff out currency should also be used to 
the maximum extent possible. 
 
-- Customs authorities and other enforcement agencies are encouraged 
to work with prosecutorial or judicial authorities to establish 
guidelines for the stopping or restraining of currency and bearer 
negotiable instruments, and the arrest and prosecution of 
individuals in cases involving falsely declared or disclosed 
currency and bearer negotiable instruments, or where there are 
suspicions that the currency or bearer negotiable instruments are 
related to terrorist financing or money laundering. 
 
-- These guidelines should also address individuals who fail to 
truthfully answer questions posed by customs officers or fail to 
co-operate with the authorities in the inspection process. 
 
-- Countries are encouraged to have co-operation arrangements with 
other countries which would allow for bilateral customs information 
exchanges between customs and other relevant agencies on 
cross-border reports, the stopping or restraining of cash and bearer 
negotiable instrument, and red flag indicators. This co-operation 
could also extend to operations involving controlled deliveries and 
other investigative techniques when unaccompanied cash and bearer 
negotiable instruments are detected at the border. 
 
-- Countries are also encouraged to enhance domestic law enforcement 
co-operation between customs, immigration and the police to respond 
to detections of currency and bearer negotiable instruments, and to 
develop intelligence. FIUs also have a useful role to play in the 
dissemination of this type of information domestically. 
 
Currency Reporting Requirements Per Customs and Border Protection 
Official Web Site 
--------------------------------------------- --------- 
 
It is legal to transport any amount of currency or other monetary 
instruments into or out of the United States.  However, if you 
transport, attempt to transport, or cause to be transported currency 
or other monetary instruments in an aggregate amount exceeding 
$10,000 (or its foreign equivalent) at one time from the United 
States to any foreign place, or into the United States from any 
foreign place, you must file a report with U.S. Customs and Border 
Protection (CBP).  This report is called the Report of International 
Transportation of Currency or Monetary Instruments, FinCEN Form 105 
(http://www.fincen.gov/forms/fin105_cmir.pdf) .  These forms can be 
obtained at all U.S. ports of entry and departure.  You may continue 
to use a Customs Form 4790, the predecessor of FinCEN Form 105, to 
file the report until such forms are exhausted. 
 
In addition to the above requirement, if you as an individual or on 
behalf of an entity recognized as legal personalities (i.e. a 
company, corporation, partnership, etc.) sends, mails or ships 
monetary instruments to the United States from a foreign country 
valued at $10,000 or more, you are required to file a report with 
CBP before sending the monetary instruments to the recipient in the 
foreign country or in the United States.  If you or a legal 
personality you are affiliated with in the United States receives 
monetary instruments valued at $10,000 or more, sent via mail, ship, 
or express courier, you are also required to report to CBP.  You are 
required to file the report within 15 days upon receipt of the 
monetary instruments. 
 
The completed form should be sent to the following address: 
 
Commissioner of U.S. Customs and Border Protection 
Attention: Currency Transportation Reports 
Washington, DC 20229 
 
Monetary instruments include: 1) U.S. or foreign coins and currency; 
2) traveler checks in any form; 3) negotiable instruments (including 
checks, promissory notes, and money orders) that are either in 
bearer form, endorsed without restriction, made out to a fictitious 
 
ABU DHABI 00003872  003 OF 003 
 
 
payee, or otherwise in such form that title thereto passes upon 
delivery; 4) incomplete instruments (including checks, promissory 
notes, and money orders) signed, but with they payee's name omitted; 
and 5) securities or stock in bearer form or otherwise in such form 
that title thereto passes upon delivery.  However, the term 
"monetary instruments" does not include: 1) checks or money orders 
made payable to the order of a named person which have not been 
endorsed or which bear restrictive endorsements; 2) warehouse 
receipts; or 3) bills of lading. 
 
Currency reporting is required under the Currency and Foreign 
Transaction Reporting Act (PL 97-258, 31 U.S.C. 5311, et seq.), as 
amended.  Failure to comply can result in civil and criminal 
penalties and may lead to forfeiture of your monetary 
instrument(s). 
 
 
Sison