VZCZCXRO2966
OO RUEHGR
DE RUEHPO #0604/01 3251948
ZNR UUUUU ZZH
O 211948Z NOV 07
FM AMEMBASSY PARAMARIBO
TO RUEHC/SECSTATE WASHDC IMMEDIATE 9812
INFO RUCNCOM/EC CARICOM COLLECTIVE
RUEHBO/AMEMBASSY BOGOTA 0528
RUEHBR/AMEMBASSY BRASILIA 1500
RUEHCV/AMEMBASSY CARACAS 1634
RUEHTC/AMEMBASSY THE HAGUE 1621
RUEHAO/AMCONSUL CURACAO 1197
RUEAWJA/DEPT OF JUSTICE WASHDC
RUEATRS/DEPT OF TREASURY WASHDC

UNCLAS SECTION 01 OF 04 PARAMARIBO 000604 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR INL, SCT, EEB 
STATE FOR WHA/CAR - JROSHOLT, KWILLIAMS 
JUSTICE FOR AFMLS, OIA, OPDAT 
TREASURY FOR FINCEN 
 
E.O. 12958: N/A 
TAGS: SNAR EFIN KCRM KTFN NS
SUBJECT: SURINAME: 2007-2008 INTERNATIONAL NARCOTICS CONTROL 
STRATEGY REPORT (INCSR), Part II, Money Laundering and Financial 
Crimes 
 
REF: SECSTATE 137250 
 
PARAMARIBO 00000604  001.2 OF 004 
 
 
¶1. (U) 1. Post presents its 2008 INTERNATIONAL NARCOTICS 
CONTROL STRATEGY REPORT (INCSR), Part II, Money Laundering and 
Financial Crimes. 
 
Suriname: 
 
¶I.  Summary: 
 
Suriname is not a regional financial center and is not yet a 
significant site for money laundering when compared to other 
countries in the region.  Money laundering occurs as a result of 
poorly regulated private sector activities, such as casinos and car 
dealerships, the non-banking financial system (including money 
exchange businesses or "cambios"), and a variety of other means 
including but not limited to construction, the sale of gold 
purchased with illicit money, and the manipulation of commercial 
bank accounts.  Narcotics-related money laundering is closely linked 
to transnational criminal activity related to the transshipment of 
Colombian cocaine.  Domestic drug trafficking organizations and 
organized crime are believed to control much of the money laundering 
proceeds, which are "invested" in casinos, real estate, and private 
sector businesses.  Suriname is not an offshore financial center and 
has neither an offshore sector nor free trade zones.  Suriname has a 
significant parallel economy of which the majority is not linked to 
money laundering proceeds. 
 
II. Legislation: 
 
Based on the recommendations of the Caribbean Financial 
Action Task Force (CFATF), the Government of Suriname (GOS) passed a 
package of anti-money laundering legislation in September 2002.  The 
legislation addresses multiple issues related to all types of money 
laundering, including (a) criminalizing money laundering, (b) 
reporting of unusual transactions in the provision of services, and 
(c) requiring service providers request identification from each 
customer making a transaction.  The legislation applies to both 
banking and non-banking financial institutions. 
 
III. Financial Sector: 
 
The law, "Reporting of Unusual Transactions in the Provision of 
Services," provides for the establishment of a Financial 
Intelligence Unit (FIU) and requires financial institutions, 
non-banking financial institutions, and "natural legal persons" (as 
opposed to companies) who provide financial services to report 
suspicious transactions to the FIU.  In total, approximately 130 
entities in Suriname are required to report to the FIU.  While the 
FIU has informed all entities of their reporting requirements, to 
date only the banking sector is in full compliance. 
 
In accordance with international conventions, objective and 
subjective indicators have been approved to identify suspicious 
transactions for financial institutions.  A suspicious transaction 
is defined as any transaction that deviates from the usual account 
as well as any customer activities that are not "normal" daily 
banking business.  Reporting is mandatory if financial transactions 
are above a certain threshold; however, non-compliance sanctions are 
currently not enforced.  The thresholds for financial institutions 
range from 5,000 USD for money-transfer offices to 10,000 USD for 
banks, insurance companies, money exchange offices, and savings and 
credit unions.  Thresholds for non-banking financial institutions 
and "natural legal persons" are 5,000 USD for casinos, 10,000 USD 
for dealers of precious metals and stones, and 25,000 USD for 
notaries, accountants, lawyers, and car dealerships.  In addition, 
service providers are required to confirm the identities of 
individual or corporate clients before completing requested 
services, and to retain photocopies of identity documents and all 
other relevant documents pertaining to national and international 
transactions for a period of seven years.  The legislation includes 
a due diligence section that holds individual bankers responsible if 
their institution launders money, and ensures confidentiality to 
bankers and others with respect to their cooperation with law 
enforcement officials.  Statutory requirements limit the 
international transportation of currency and monetary instruments; 
amounts in excess of 10,000 USD must be reported to authorities 
before entering or leaving Suriname.  Suriname does not recognize 
 
PARAMARIBO 00000604  002.2 OF 004 
 
 
indigenous alternative remittance systems.  There is a gold economy 
in gold mining regions in the country's interior.  There are no 
known cases of charitable or non-profit entities serving as conduits 
for financing terrorism. 
 
IV. Financial Intelligence Unit: 
 
In early 2003, the FIU opened an office with material support from 
the U.S. Government.  The FIU received extensive training from a 
Dutch expert in 2004 through the Caribbean Anti-Money Laundering 
Program (CALP).  The FIU, which falls under the auspices of the 
Attorney General's Office, is an administrative body that performs 
analytical duties.  Its responsibilities entail requesting, 
analyzing, and reporting to the Attorney General's office 
information on transactions that may constitute money laundering. 
If necessary, the FIU may request access to the records of other 
government entities.  To facilitate interagency coordination, 
Suriname has an Anti-Money Laundering Project Team, which consists 
of representatives from the FIU, Judicial Police, the Attorney 
General's Office, and the judiciary.  Bureaucracy and the lack of 
financial and human resources have made it difficult for the FIU to 
perform to its best capabilities.  On the basis of a Memorandum of 
Understanding (MOU), Suriname shares information regarding money 
laundering with the FIU in the Netherlands.  Another MOU was 
concluded with the Netherlands Antilles in October 2007.  Government 
representatives dealing with the issue of money laundering attended 
training abroad on financial investigative techniques in June 2007, 
and on combating money laundering in October 2007.  The number of 
suspicious transactions tagged by the FIU in 2007 is not public 
information. 
 
Suriname's money laundering regime was enhanced in 2004 with the 
establishment of a Financial Investigation Team (FOT) that is under 
the authority of the Judicial Police.  Upon making a determination 
that a suspicious activity report is sufficient to initiate an 
inquiry, the FIU refers the matter to the Attorney General's Office. 
 If the Attorney General's office concurs with that determination, 
it directs the FOT to conduct an investigation.  The FOT is the body 
responsible for investigating all suspicious transactions identified 
by the FIU.  Prosecutors use evidence collected from FOT 
investigations to build legal cases.  To help strengthen the FOT, a 
U.S. government technical adviser mentored investigators in 2005. 
Nonetheless, the FOT continued to suffer from a lack of   personnel 
and resources which rendered it largely ineffective over the past 
year.  The 2004 sentencing of someone to seven years imprisonment 
for intentional money laundering and for attempting to export a 
small amount of cocaine remains the most significant success and 
longest sentence to date.  Resource constraints -- and a severe 
shortage of judges -- is proving to be a limiting factor in 
expanding this success.  A new class of seven judges could partially 
redress the problem, but they will not complete their judicial 
training until 2008. 
 
While the number of prosecutions in 2007 related to money laundering 
was not public information, there were several significant 
convictions in 2007 related to illegal transfers of money.  In 
August 2007, De Surinaamse Bank President Siegmund Proeve and former 
Bank President Edward Muller were sentenced to six months 
imprisonment for the illegal transfer of approximately USD 14.5 
million in casino profits to foreign countries between 1998 and 
¶2003.  The defendants were charged with transferring funds without 
the permission of the Foreign Exchange Commission and for the 
transfer of amounts over USD 10,000 without reporting it to the 
Central Bank.  Other defendants in the case were Procurement Officer 
Patrick Bagwandin, who was sentenced to a conditional three month 
imprisonment, and Canadian Dorsett Group staffer Jeffrey Claque, who 
was sentenced to six months.  The bank was fined USD 358,000.  The 
defendants are appealing the case and are serving their sentences 
while the case is under appeal. 
 
In July, a judge handed down the verdict in a 2006 case in which 3 
people were arrested with a large sum of money and charged with 
money laundering.  Two of the defendants were arrested after police 
put up a roadblock between Paramaribo and the country's most western 
district, Nickerie.  The police seized the money and the vehicle the 
two were driving. The three were sentenced to 12 weeks imprisonment 
and each paid an additional fine of 3,600 USD.  The prosecution 
filed an appeal in this case, as is possible under Suriname law, 
 
PARAMARIBO 00000604  003.2 OF 004 
 
 
because they thought the sentences too lenient. 
 
Close cooperation between Suriname and the Netherlands led to the 
investigation and arrest of Bidjai Parmessar, a major drug 
trafficker who was sentenced in December 2005 to ten years 
imprisonment in the Netherlands for narcotics trafficking and money 
laundering.  The cooperation between the two countries also led to 
the 2005 arrest of three persons in a high profile money laundering 
scandal.  In January 2006, one of the three was sentenced by a Dutch 
Court to two and a half years imprisonment for money laundering.  In 
August 2006, the second suspect was convicted in Suriname, also on 
money laundering charges, and sentenced to one and a half years in 
prison.  The third suspect was former Minister of Trade and Industry 
Siegfried Gilds, who resigned his position after the Attorney 
General announced he was under investigation for laundering money 
and membership in a criminal organization.  The former Minister is 
alleged to have laundered close to 1,270,000 USD between 2003 and 
¶2005.  His trial is ongoing. 
 
In December 2005, police officers seized 388,525 USD from a Guyanese 
national attempting to cross the border between Suriname and Guyana. 
 He was acquitted in August 2006 due to lack of evidence and was 
fined 350 USD for violating currency transporting regulations. 
Public prosecutors are appealing the case because they think the 
judge's ruling was too lenient. 
 
Suriname has not yet signed the UN Convention for the 
Suppression of the Financing of Terrorism; draft legislation was 
prepared by the Ministry of Justice and Police and is awaiting the 
Council of Ministers' approval. Suriname does have legislation that 
allows the authorities to freeze assets of those suspected of money 
laundering.  The Central Bank of Suriname circulates to commercial 
banks the names of individuals/entities that are designated by the 
United Nations 1267 Sanctions Committee list as associates of Al 
Qaeda, the Taliban, or Usama bin Laden.  In 2002, Suriname signed 
the OAS Inter-American Convention against Terrorism but has not yet 
ratified it. Anti-terrorism legislation -- required to fully satisfy 
UN Security Council Resolution 1373, which deals with suppressing 
financing for and improving international cooperation on terrorism 
-- is still in the drafting stage. 
 
¶V. Cross Border Transportation of Currency and Negotiable 
Instruments 
 
Any person who wishes to take money in excess of USD 10,000 out of 
the country must notify the Military Police.  The Central Bank of 
Suriname also requires that all transactions in excess of USD 10,000 
be reported. 
 
VI. Asset Forfeiture and Seizure Legislation 
 
An amendment to the criminal code enacted in 2003 allows authorities 
to confiscate illegally obtained proceeds and assets obtained partly 
or completely through criminal offenses; however, assets cannot be 
converted to cash or disposed of until the case is settled.  New 
assets forfeiture legislation, which would make this possible, is 
under consideration in Parliament.  There are no provisions for 
civil forfeiture, and there is no legal mechanism that designates 
the proceeds gained by the sale of forfeited goods to be used 
directly for law enforcement efforts.  There is no entity for the 
management and disposition of assets seized and forfeited for 
illicit drug trafficking and money laundering offenses.  There have 
been cases in court where the Attorney General seized financial 
assets related to the narcotics trade. 
 
VII. International Cooperation 
 
On June 2nd, 1887, an extradition treaty was signed between the 
United States and The Kingdom of The Netherlands which entered into 
force on July 18th, 1889.  An amendment to this treaty followed in 
¶1904.  As Suriname was a colony of the Kingdom of the Netherlands at 
that time, the enforcement of this treaty also applied to Suriname. 
Upon its independence in 1975, Suriname automatically adopted this 
treaty into its own legislation and it still serves as the 
extradition treaty between the United States and the Republic of 
Suriname.  The GOS has an agreement with the Netherlands on 
extradition of non-nationals and mutual legal assistance with regard 
to criminal matters but, under Surinamese law, citizens of Suriname 
 
PARAMARIBO 00000604  004.2 OF 004 
 
 
"will not be extradited."  Money laundering is an extraditable 
offense. 
 
Suriname is party to the UN Convention against Illicit Traffic in 
Narcotic Drugs and Psychotropic Substances.  In May 2007, Suriname 
acceded to the UN Convention against Transnational Organized Crime. 
Suriname has bilateral treaties and cooperation agreements with the 
United States on narcotics trafficking, and with Colombia, France 
and the Netherlands Antilles on transnational organized crime.  In 
January 2006, Suriname, the Netherlands Antilles, and Aruba signed a 
Mutual Legal Assistance Agreement allowing for direct law 
enforcement and judicial cooperation between the countries, making 
it no longer necessary for the process to be first routed through 
The Hague.  Parties to the Agreement, which covers cooperation with 
regard to drug trafficking, trafficking in persons, and organized 
crime, had a follow-up meeting in March 2007 and expanded the 
cooperation to include information sharing on transnational crime 
and financial crimes. 
 
In October 2006, Suriname hosted an anti-narcotics conference 
attended by many regional and international players, including the 
United States.  The "Paramaribo Declaration," which was endorsed in 
principle at the end of the conference, is a framework to establish 
an intelligence-sharing network, coordinate and execute sting 
operations, and tackle money laundering.  Suriname is a member of 
the CFATF and the OAS Inter-American Drug Abuse Control Commission 
Experts Group to Control Money Laundering (OAS/CICAD).  Suriname 
signed the Inter-American Convention against Terrorism in June 2002, 
but has not yet ratified it.  In February 2006, a joint team 
consisting of members of the Financial Transactions Reports Analysis 
Center of Canada (Fintrac) and the American Financial crimes 
Enforcement Network (Fincen) visited Suriname and agreed to sponsor 
Suriname's FIU in the Egmont membership procedure.  The two 
organizations proposed steps to be taken by the country to file an 
application for Egmont membership in the beginning of 2007; one of 
the required steps is ratification of the Inter-American 
Anti-Terrorism Convention. 
 
SCHREIBER HUGHES