VZCZCXYZ0010
OO RUEHWEB

DE RUEHME #1438/01 1471500
ZNR UUUUU ZZH
O 271500Z MAY 09
FM AMEMBASSY MEXICO
TO RUEHC/SECSTATE WASHDC IMMEDIATE 6659
INFO RUCPDOC/DEPT OF COMMERCE WASHINGTON DC IMMEDIATE
RUEKJCS/SECDEF WASHINGTON DC IMMEDIATE
RHMFIUU/FBI WASHINGTON DC IMMEDIATE
RUEAIIA/CIA WASHINGTON DC IMMEDIATE
RHMFIUU/HQ BICE INTEL WASHINGTON DC IMMEDIATE

UNCLAS MEXICO 001438 
 
SENSITIVE 
SIPDIS 
 
FOR PM/DTCC - BLUE LANTERN COORDINATOR, WHA/MEX, AND INL/LP 
 
E.O. 12958: N/A 
TAGS: ETTC KOMC SNAR MX
SUBJECT: BLUE LANTERN LEVEL 3: PRE-LICENSE END-USE CHECK ON 
APPLICATION 050152211 
 
REF: STATE 32114 
 
¶1. (SBU) On 13 May, Poloff conducted a pre-license end-use 
check in-person interview with Carlos Rodriguez Velazquez of 
Industrias Velmal S.A. de C.V.  During the interview Poloff 
clarified the relationship between the intermediary 
distributor, Industrias Velmal, and the end user, Tum 
Transportistas.  Carlos Rodriguez Velazquez is an import 
agent who jointly ventures with IUSA, a manufacturer, to 
supply armored vehicles to a customer -- in this specific 
case Tum Transportistas. During the course of the interview, 
the process and interactions between participants was 
explained in detail.  Tum Transportistas placed an order with 
IUSA for armored vans. Issel Perez was the contract 
specialist for IUSA and the individual responsible for 
coordinating the order.  Industrias Velmal S. A. de C.V is 
the import agent for ballistic steel for IUSA.  Carlos 
Rodriguez Velazquez requested the license for the import of 
the armor plating and is the responsible agent for the 
transaction.  Velmal S.A. de C.V. is a pass through agent 
that does not handle or warehouse any material.  The plan is 
for the product to go directly to IUSA industries for 
fabrication followed by final product delivery to Tum 
Transportistas. The order amount was placed to fulfill the 
request for 40-60 armored vans. 
 
¶2. (SBU) On 21 May, Poloff conducted a pre-license end use 
check phone interview with Karem Musalan of Tum 
Transportistas.  Musalan confirmed his relationship with IUSA 
and was fully aware of the business relationship between 
Industrias Velmal S.A. de C.V. and IUSA.  He noted that he 
was still in negotiations with IUSA for the purchase of 40 
large armored trucks for his distribution business.  He 
indicated that his business distributed products for Sony, 
Nestle, and Colgate-Palmolive throughout Mexico.  Musalan 
said that he has an agreement to purchase but no purchase 
order has been completed as a result of the on going 
negotiations. 
 
¶3.  (SBU) Responses to reftel questions. 
 
-- Does the company have supporting documentation for the 
proposed transaction?  The purchase order request is between 
Tum Transportistas and IUSA.  Because no export license has 
been granted to Industrias Velmal, an official request has 
not been generated from IUSA to Industrias Velmal. 
Additionally,  no purchase order exists as of yet between 
IUSA and TUM Transportistas.  TUM Transportistas will confirm 
purchase when it knows IUSA has the ability to deliver the 40 
armored trucks. This is based exclusively on the ability of 
Industrias Velmal to acquire the ballistic steel. 
 
-- Did Tum Transportistas order the exact type and quantity 
of items listed on this application?  Tum Transportistas 
plans to order a quantity of 40 vans from IUSA.  IUSA's 
request to Industrias Velmal for armor plating is consistent 
with the amount of vans requiring the material. 
 
-- What is the exact end use of this USML item?  Armored 
plating for 40 bullet proof trucks. 
 
-- What is the nature of its business? What type of item does 
it handle? does it serve as a broker?  Velmal S.A. de C.V. is 
an import agent. IUSA is a manufacturer. Tum Transportistas 
is a distribution firm. 
 
-- What type of organizations are among its typical customers 
and where are the customers located?  Velmal S.A de C.V. is 
an authorized distributor for ballistic steel and works with 
various companies in the fabrication of armored vehicles, 
which is the end product.  Its customer base includes Logis 
Transportes, Eurologistic and Expres Milac, all located in 
Mexico.  Tum Transportistas distributes to Nestle, 
Colgate-Palmolive and Sony throughout Mexico. 
 
-- Does Industrias Velmal S.A de C.V. have a firm purchase 
order from proposed end user Tum Transportistas?  No.  The 
importer/fabricator relationship is between Industrias Velmal 
S.A. de C.V. and IUSA. IUSA has a request from Tum 
Transportistas for a quantity of 40 armored large trucks. 
There is a purchase request; however, the official order has 
not been placed as Tums is waiting for confirmation that IUSA 
can fulfill the order.  The pre-license acceptance will allow 
the order to be completed. 
 
-- Does the company understand the restrictions on United 
States Munitions List (USML) items, particularly those that 
prohibit the unauthorized stockpiling of U.S. defense 
articles?  Carlos Rodriguez Velazquez is aware of all 
restrictions and is cognizant of the fact that he signed 
paperwork affirming that he would not stockpile such items. 
Industrias Velmal does not have warehousing capability and 
maintains office space in Toluca Mexico.  Carlos Rodriguez 
Velazquez is an agent and works from his residence.  All 
material goes directly to fabricators to make armored 
vehicles. 
 
-- Does the company understand the ITAR prohibitions against 
the unauthorized re-transfer and re-export of USML items? 
Carlos Rodriguez Velazquez is aware of these prohibitions and 
emphasized his commitment to compliance based on his 
signature on the appropriate pre-authorization paperwork. 
 
 
¶4.  Carlos Rodriguez Velazquez ended the meeting with a 
request for additional information regarding the specific 
restrictions on stockpiling of restricted items.  He 
indicated that he has several small customers requiring 1-3 
armored vehicles and it is not cost effective to order 
material for such small quantities.  He would like to get 
more information on his ability to have a ready stock of 
armor plating or the ability to bundle orders from different 
companies to make the import of these items cost effective. 
Additionally he had concerns about the 2 month administrative 
process time it takes to vet and complete orders.  The 
process time greatly affects his ability to meet customer 
demands for this product.  Poloff indicated that he would 
request this information and clarification on these matters. 
 
¶5. (SBU) Poloff finds that the intended use of the controlled 
items of the distributor and the end-user meets all 
requirements stipulated by the law and does not see any 
adverse intentions of this transaction. 
 
Visit Mexico City's Classified Web Site at 
http://www.state.sgov.gov/p/wha/mexicocity and the North American 
Partnership Blog at http://www.intelink.gov/communities/state/nap / 
BASSETT