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S E C R E T BUENOS AIRES 001833 
 
SIPDIS 
 
NOFORN 
 
SIPDIS 
 
E.O. 12958: DECL: 09/12/2027 
TAGS: PTER EFIN KCRM PREL PGOV SNAR AR PA BR
SUBJECT: ARGENTINA: AMBASSADOR'S VISIT TO THE TRIBORDER AREA 
 
Classified By: Ambassador E. Anthony Wayne for reasons 1.4(b) 
(c)and(d) 
 
¶1. (S/NF) Summary: On September 11, top Argentine 
intelligence officials and analysts briefed Ambassador on 
their perspective of the terrorist threat in the Tri-Border 
Area (TBA).  They noted that Hizballah maintains a real 
structure in the region, including experienced agents.  They 
detailed advantages of the triborder region, noted that U.S. 
Treasury designations had led Hizballah to become more 
circumspect in its practices, and expressed their 
frustrations at the challenges of trying to counter terrorism 
concerns with in three separate national jurisdictions. 
 
¶2. (C) Ambassador met September 6 in Puerto Iguazu with the 
Argentine Gendarmeria's and Federal Police's (PF) 
counterterrorism units and was briefed on their "targets of 
interest," linked to terrorism financing and other illicit 
activities, operating in the TBA.  These mostly family-based 
business groups, with origins in and ties to Lebanon, are 
involved in the sale of contraband electronic goods, 
appliances, and clothing, but also deal in the trafficking of 
persons, drugs, and arms.  The money is either flown out in 
bulk or sent through a network of legal and illegal currency 
exchange house. 
 
¶3. (C)  In Ciudad del Este, Paraguay, Ambassador together 
with Embassy Asuncion DCM Fitzpatrick, toured the bustling 
streets, witnessed the endless packaging of bundles on their 
way to Foz do Iguacu, and met with a Paraguayan federal 
economic prosecutor working to stem the illicit flow. 
Reported Septel, Ambassador and Embassy Asuncion DCM also 
visited the International Organization for Migration's 
regional anti-TIP program while in Ciudad del Este. End 
Summary. 
 
VIEW FROM THE BORDER 
-------------------- 
¶4. (C) Puerto Iguazu Federal Police and Gendarmeria 
counterterrorism units briefed Ambassador and EmbOffs 
September 6 on their activities in the TBA.  Their 
information on the organization and activities of the 
"targets of interest" operating in the TBA, individuals and 
family-based business groups of largely Lebanese origin, is 
extensive.  They noted the presence of individuals with 
experience working with the Hizballah in Lebanon.  Due to its 
proximity to Brazil and Argentina, the business of Paraguay's 
Ciudad del Este has long been in contraband goods, mostly 
electronics and appliances from the U.S. and Far East and 
locally produced pirated goods (DVDs, CDs, clothing). 
Although these business groups are 
largely of Middle Eastern origin, a number are owned and 
operated by Taiwanese-origin groups.  Most of the individuals 
are Brazilian and/or Paraguayan citizens who live in Foz do 
Iguacu, Brazil and run their businesses in Ciudad del Este, 
Paraguay. 
 
¶5. (C) Several of their targets have been designated by U.S. 
Treasury for terrorism financing activities, and several are 
in jail or on trial in Paraguay for various infractions -- 
some for drug trafficking, but most for tax and customs 
violations.  Ambassador noted the case of Al Capone in the 
United States, brought down by tax evasion charges rather 
than his violent crimes.  The Police and Gendarmeria 
officials agreed that this was the most effective way to go 
after these groups operating in the TBA. 
 
¶6. (C) The contraband activity, though largely comprised of 
regular commercial items evading customs and tax duties, also 
includes drug and arms trafficking, document fraud, and 
trafficking in persons.  The profits are either flown out in 
bulk cash or wired out through legal and illegal networks of 
money exchange houses.  In Ciudad del Este, the Ambassador 
and Asuncion DCM met with a Paraguayan federal 
financial crimes prosecutor.  He related the difficult 
circumstances of his work (including pressures on his 
family), notably that his cases stall once they get to the 
courts, mostly due to corruption.  He said a key to success 
was in changing the practices of under-valuing customs 
declarations, including massive electronics imports from the 
U.S.  This practice, he argued, is essential to much of the 
contraband traffic.  Nevertheless, he noted some successes in 
prosecution and responded when asked that he was optimistic 
that authorities will eventually get the upper hand on the 
contraband trade.  He was extremely appreciative of continued 
strong USG support for vetted units such as his, which he saw 
as essential to success. 
 
VIEW FROM BUENOS AIRES 
---------------------- 
¶7. (S/NF) On September 11, Argentine intelligence service 
analysts briefed Ambassador and EmbOffs on their perceptions 
of the terrorist threat.  Perhaps as a gesture on this 
important anniversary, the Secretary of Intelligence and his 
deputy who provides day-to-day leadership of the service 
participated.  The Argentines emphasized that Hizballah 
maintains a real structure in the Paraguayan and Brazilian 
portions of the TBA, which includes individuals who have been 
active Hizballah operatives in Lebanon and thus pose a higher 
potential threat.  They noted the TBA has many advantages: 1) 
relatively easy ways to make money; 2) easily available real 
"false" documents and easy immigration/residency/citizenship 
requirements; 3) very porous frontiers; and 4) the presence 
of many financial institutions and a large informal money 
flow. 
 
¶8. (S/NF) The analysts noted that Hizballah has a second 
generation of leaders in the region and that they have made 
significant efforts to show themselves as good members of the 
community.  They also noted that once the U.S. Treasury 
designated several individuals in late 2006, local Hizballah 
members became very nervous and took steps to regularize 
their commercial practices and to pay their taxes.  They have 
generally become much more circumspect. 
 
¶9. (S/NF) Comment:  Argentines at the border and in the 
Capitol were at pains to stress their desire to work as 
closely as possible with us.  The presence of the two top 
intelligence officials for the September 11 briefing signaled 
that.  However, it is also clear that the Argentines feel 
great frustration in the limits they face in cooperation with 
Paraguay and Brazil, and Uruguay too.  They know they have to 
work to make that cooperation better, but they clearly chafe 
at the current inefficiencies in going after the terrorist 
threat. 
 
WAYNE