VZCZCXYZ0017
PP RUEHWEB

DE RUEHRB #0327/01 1041814
ZNR UUUUU ZZH
P 141814Z APR 09
FM AMEMBASSY RABAT
TO RUEHC/SECSTATE WASHDC PRIORITY 9992
INFO RUCNMGH/MAGHREB COLLECTIVE
RUEATRS/DEPT OF TREASURY WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC

UNCLAS RABAT 000327 
 
SIPDIS 
SENSITIVE 
 
STATE FOR S/CT, H AND NEA/MAG 
 
E.O. 12958: N/A 
TAGS: ECON EFIN PTER ETRD MO
SUBJECT: CODEL LYNCH REVIEWS MOROCCO'S TERRORISM FINANCE 
COUNTERMEASURES 
 
REF: STATE 029978 (NOTAL) 
 
¶1.  (SBU) Summary:  In an April 10 meeting with the Ministry 
of Finance, CODEL Lynch encouraged Morocco's new Financial 
Intelligence Unit, launched on the morning of the CODEL's 
visit to Morocco, to closely coordinate with U.S. 
counterparts to ensure maximum integration with relevant 
financial authorities in other countries.  Government of 
Morocco representatives thanked the Representatives Lynch and 
Inglis for their interest in Morocco's efforts to combat 
financial crimes, and praised U.S. technical assistance, 
growing investment and commercial ties.  Although the new 
Unit will take some time to recruit staff and define its 
responsibilities, it would respond to the U.S. offers for 
assistance, its president assured the delegation.  End 
Summary. 
 
¶2.  (SBU) Ministry of Finance Secretary General Abedeltif 
Loudyi, along with President of the Financial Intelligence 
Unit (FIU) Hassane Abdellaoui and Bilateral Relations 
Director Abdelaziz Khaoua, welcomed Representatives Lynch and 
Inglis to Morocco.  Excusing Minister of Finance Mezzouar due 
to his obligations in Parliament, Loudyi commented with 
satisfaction on Morocco's economic and assistance relations 
with the U.S., highlighting the Millennium Challenge Account 
Compact and the U.S.-Morocco Free Trade Agreement (FTA) as 
particularly helpful in promoting growth and strengthening 
investment and commercial ties.  Loudyi also praised 
technical assistance provided by USAID to Morocco. 
 
¶3.  (SBU) Representative Lynch noted that both he and 
Representative Inglis are "friends of Morocco" who had 
supported approval of the FTA in 2005.  Representative Lynch 
congratulated Morocco for its efforts to combat terrorist 
financing and for its official inauguration of the new FIU 
that morning.  Representative Lynch noted that he has 
assisted in establishing FIUs in many countries, including 
Afghanistan and Jordan, and observed that the key to success 
is making informed early decisions on technology and 
training.  Representative Lynch recommended that the new FIU 
work closely with the U.S. Treasury's Financial Crimes 
Enforcement Network (FinCEN) to ensure useful networking 
capabilities with international partners and adopt 
international best practices for an FIU. 
 
¶4.  (SBU) Loudyi thanked the Congressmen for their counsel 
and observed that Abdellaoui's prior experience with the 
International Monetary Fund and the central bank had 
sensitized him to the need to develop useful and compatible 
working relationships with international partners.  Loudyi 
also outlined the extant training relationship with the 
European Union to provide technical assistance for the FIU 
and the Ministry of Finance, a collaboration that includes on 
average one training session per week for two years.  The new 
FIU, Loudyi elaborated, will continue the interaction the 
Finance Ministry had conducted with banks and financial 
institutions to ensure adherence to practices mandated to 
fight money laundering and terrorist financing.  The FIU 
would be strengthened in its work relative to the Finance 
Ministry, however, by the incorporation of elements from the 
Ministry of Justice and the central bank. 
 
¶5.  (SBU) Responding to Representative Inglis's query about 
Moroccans, perceptions of the FTA, Loudyi endorsed the 
benefits of the increases in investment and trade since the 
date of its effect, but observed that Moroccan exporters need 
to adapt to American norms and standards to take full 
advantage of the U.S. market. 
 
¶6.  (SBU) Representative Inglis asked Loudyi his assessment 
of how the government's policies have minimized the appeal of 
extremism in Morocco.  Loudyi highlighted the kingdom's steps 
toward democracy and measures to strengthen respect for human 
rights and political pluralism.  King Mohammed VI has 
emphasized social programs to reduce the development 
disparities between urban and rural populations, helping 
defuse extremist sentiments.  Additionally, he continued, 
increased transparency through reforms, such as the new FIU, 
the Central Agency for the Prevention of Corruption and 
upcoming judicial changes, have given citizens a greater 
stake in society.  The goal is clear, Loudyi concluded, but 
"we still have a lot of work to do."  Representative Lynch 
emphasized that concerns over terrorist financing can 
undermine the integrity of trading and financial relations. 
The proper functioning of financial relations, he stated, 
will depend on ensuring that the wrong people are not able to 
exploit the legitimate financial system.  In response to 
 
Representative Lynch,s question about hawalas, Loudiyi said 
it is foreigners rather than Moroccans who are the primary 
users, and approximately 80 percent of financial transactions 
go through the formal financial system and its institutions. 
 
¶7.  (SBU) The Charge concluded the meeting by again 
congratulating Loudyi and Abdellaoui on the inauguration of 
the FIU, and reminding them of the offer of cooperation from 
the U.S. Treasury's Office of Technical Assistance.  Loudyi 
assured the Charge that Abdellaoui would respond to the 
Treasury with specific requests as the FIU takes definition. 
 
¶8.  (U) This cable has been cleared by Congressional Staff 
Member Bruce Fernandez. 
 
 
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Jackson