VZCZCXRO6032
PP RUEHAG RUEHDF RUEHIK RUEHLZ RUEHROV
DE RUEHNC #0880 3060512
ZNR UUUUU ZZH
P 020512Z NOV 07
FM AMEMBASSY NICOSIA
TO RUEHC/SECSTATE WASHDC PRIORITY 8288
INFO RUCNMEM/EU MEMBER STATES COLLECTIVE PRIORITY
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY

UNCLAS NICOSIA 000880 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR ISN/CPI AND T 
TREASURY FOR TFFC 
 
E.O. 12958: N/A 
TAGS: PARM PREL MNUC KNP EFIN CY
SUBJECT: CYPRUS: FATF STATEMENT ON IRAN 
 
REF: A. STATE 149648 
     ¶B. STATE 148605 
     ¶C. NICOSIA 859 
 
¶1. (SBU) Per Ref A, on October 31 we met with Eva 
Papakyriakou the Director of the Attorney General's Unit for 
Combating Money Laundering (MOKAS, Cyprus' Financial 
Intelligence Unit,) and Michael Styliannou, Senior Officer at 
the Central Bank of Cyprus for Bank Supervision and 
Regulation. They both advised us that they were aware of the 
recent FATF actions and would this week issue a circular to 
Cypriot financial institutions  noting the deficiencies in 
Iran's AML/CFT regime and the need to undertake "more 
detailed due diligence and scrutiny" when an Iranian 
counterparty is involved. The circular "will be similar to" 
the one prepared by U.S. Treasury's FinCen which was received 
by the GoC last week. 
 
¶2. (SBU) Styliannou noted that Cyprus had previously issued 
circulars regarding dealing with Iranian entities based on 
UNSC Resolutions 1737 and 1747. Papakyriakou advised us that 
next week she will issue a directive that her office be 
advised of any dealings with the Iranian entities and 
individuals mentioned in ref B. She would then seek to freeze 
any assets identified using UNSC 1737 and 1747 as a legal 
basis although this would be subject to a court ruling. 
Papakyriakou advised that courts in Cyprus would be more 
likely to agree to a freeze if the names had been submitted 
to the UNSC, even if the UNSC had yet to take action. 
 
¶3. (SBU) Bilateral trade between Cyprus and Iran is minimal. 
In 2006, Cyprus exported US$5.4 million to Iran and imported 
US$3.9 million of which about 67% was pistachio nuts. The 
Central Bank told us that while some Cypriot banks maintain 
correspondent relationships with Iranian banks, there are 
very few transactions. 
SCHLICHER