VZCZCXRO7085
PP RUEHAG RUEHAST RUEHBI RUEHCI RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK
RUEHKW RUEHLA RUEHLH RUEHLN RUEHLZ RUEHNEH RUEHNP RUEHPOD RUEHPW
RUEHROV RUEHSK RUEHSR RUEHVK RUEHYG
DE RUEHTA #0925/01 1520633
ZNR UUUUU ZZH
P 010633Z JUN 09
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 5508
INFO RUCNCIS/CIS COLLECTIVE 1617
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 0994
RUEHKO/AMEMBASSY TOKYO 1697
RUEHUL/AMEMBASSY SEOUL 0674
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1179
RUEKJCS/SECDEF WASHDC 1095
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL
RUEHAST/USOFFICE ALMATY 1562
RUEAWJL/DEPT OF JUSTICE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHDC
RHMCSUU/FBI WASHINGTON DC
RUEABND/DEA HQS WASHINGTON DC
RHMFIUU/DEPT OF HOMELAND SECURITY WASHINGTON DC 0018
RUEANQT/FINCEN VIENNA VA

UNCLAS SECTION 01 OF 02 ASTANA 000925 
 
SENSITIVE 
SIPDIS 
 
STATE FOR INL/AAE, INL/C, SCA/CEN; FINCEN FOR DAVID TEITELBAUM 
 
E.O. 12958: N/A 
TAGS: PGOV PREL SNAR KCRM KCOR KZ
SUBJECT: KAZAKHSTANI FINANCIAL INTELLIGENCE UNIT VISITS UNITED 
STATES 
 
ASTANA 00000925  001.2 OF 002 
 
 
¶1. (U) Sensitive but unclassified.  Not for public Internet. 
 
¶2. (U) SUMMARY.  A delegation from the Committee of Financial 
Monitoring of the Ministry of Finance participated in an FIU 
orientation program presented by the Financial Crimes Enforcement 
Network (FinCEN).  The orientation program was created by FinCEN for 
newly established FIUs.  In addition to FinCEN, the delegation met 
with INL Deputy Assistant Secretary Snyder and representatives from 
the IRS, including one from the information technology department. 
Upon their return to Kazakhstan, members of the delegation began 
preparing to brief the rest of the Committee on information learned 
during the trip.  The Chairman of the Committee is also continuing 
to push Anti-Money Laundering (AML) legislation through the upper 
house of Parliament.  END SUMMARY. 
 
BACKGROUND 
 
¶3. (U) The Committee on Financial Monitoring -- Kazakhstan's 
Financial Intelligence Unit (FIU) -- was established under the 
Ministry of Finance in April 2008 and Mussiraly Utebayev was 
appointed chairman six months later.  During his first meeting with 
the Embassy's INL Office, Utebayev requested a study tour to the 
United States to learn more about the structure and operation of his 
Committee's U.S. counterpart, the Financial Crimes Enforcement 
Network (FinCEN). 
 
FINCEN VISIT 
 
¶4. (U) In response, INL sponsored a study tour for senior officials 
from the FIU to visit FinCEN April 13-17.  During the visit, the 
Kazakhstani FIU officials were engaged and raised many issues, 
frequently asking detailed questions and insisting on equally 
detailed answers.  They were especially interested in how FinCEN 
evaluates its effectiveness, including the number of investigations 
conducted using FinCEN information.   At the end of their visit to 
FinCEN, Chairman Utebayev made a presentation on the future of the 
FIU. 
 
¶5. (SBU) The FIU is already working on IT development and has funds 
allocated for the next three years.  The delegation, which included 
the head of the IT department, was interested in FinCEN's systems 
and, because FinCEN's systems are operated by the IRS, was pleased 
to have the opportunity to meet with the IRS during their trip. 
They asked the IRS detailed questions about data storage, 
transmission, and system modernization.  The FIU is facing some 
bureaucratic problems in developing its system and the Kazakhstanis 
were relieved to find they are on the right track.  The delegation 
also asked about procedures for providing access to different 
agencies and who bears responsibility for leaked information.  In 
this regard, they asked about actual cases of misuse or leakage of 
information and disciplinary actions in response to such incidents. 
 The FIU is clearly very concerned about the risks of providing 
information to users outside of the FIU. 
 
¶6. (U) The delegation sought advice on how best to get information 
from law enforcement agencies -- through direct access or by 
uploading information from databases to an FIU system.   FinCEN 
representatives explained that the biggest issue is not how 
information is accessed, but not allowing law enforcement to know 
the reason for specific information requests. 
 
¶7. (U) The delegation asked questions about a range of financial 
monitoring issues:  financial monitoring of attorneys, monitoring 
the various categories of financial transactions in banks, training 
for bank compliance officers and employees, penalties for 
non-compliance, and procedures for interaction between FinCEN and 
those subject to financial monitoring.  During the discussion of the 
various reporting forms used by FinCEN, the delegation agreed that 
developing a single report for both suspicious and currency 
 
ASTANA 00000925  002.2 OF 002 
 
 
transactions would be a better solution for Kazakhstan. 
 
¶8. (U) Chairman Utebayev was especially interested in FinCEN's 
analysis of the dangers of money laundering through mortgage loans 
and the issue of attorney-client privilege.  He expressed a desire 
to cooperate with FinCEN in such areas and requested FinCEN's 
mathematical models in order to perform similar analyses in 
Kazakhstan.  He also told the Director of FinCEN that he was willing 
to cooperate with FinCEN in its research on foreign currency flows. 
 
¶9. (SBU) The delegation also delved deeply into organizational and 
structural issues, asking about the division of duties among 
analysts, the time spent per case, and the procedures for dealing 
with political corruption cases.  Utebayev asked about the 
educational background and training of FinCEN's employees. 
 
THE FUTURE OF THE FIU 
 
¶10. (SBU) Chairman Utebayev is looking to protect his FIU from 
corruption and, thus, would like to separate the FIU from the 
Ministry of Finance and operate it as an independent body.  He 
believes that the FIU is vulnerable within the Ministry because 
officials of other Committees, such as the Customs Committee and Tax 
Committee, may not be pleased with the work of the FIU and may 
attempt to stand in its way.  This concern seems to be influencing 
many of Utebayev's decisions about the operation the FIU. For 
example, he does not want to provide database access to law 
enforcement agencies and is planning to provide information only in 
response to official requests. 
 
¶11. (SBU) Utebayev is also interested in his FIU playing a leading 
role in overseeing government bailout funds transferred to private 
companies.  He was asked about the role FinCEN is playing in U.S. 
bailouts. 
 
¶12. (SBU) During his meeting with INL DAS Snyder, Utebayev stated 
that, at full strength, the FIU will employ 65 people in Astana and 
30 in Almaty.  Currently there are approximately 30 people in 
Astana.  Utebayev asked for assistance in four areas: (1) support 
for Kazakhstan's entry into the Egmont Group; (2) help in arranging 
additional study tours to countries with federal-style system of 
government; (3) staff training; and (4)support for cooperation with 
the World Bank in joint research projects. 
 
FURTHER DEVELOPMENTS 
 
¶13. (U) Kazakhstan has concluded a memorandum of cooperation with 
Russia in the areas of information technology and legislation.  The 
Embassy's INL Office plans to sponsor training for the FIU's 
personnel, but does not want to duplicate assistance provided by 
Russia or other donors.  We thus hope that the U.S. delegation can 
hold a donor meeting on Kazakhstan with the World Bank and Russia on 
the margins of the EAG meeting in St. Petersburg June 8-10. 
 
AML LAW UPDATE 
 
¶14. (SBU) During a follow-up meeting in Astana, Utebayev updated INL 
on the status of Anti-Money Laundering (AML) legislation.  Utebayev, 
a former Senator, has had a series of meetings with the main 
committees of the Senate involved with the legislation.  He is 
concerned that the Senate wants to amend it to cover both "terrorism 
financing" and the financing of "extremist organizations."  Utebayev 
is planning to offer to draft FATF recommendations to address this 
issue during the EAG in June rather than amending the AML 
legislation.  Currently, he is trying to convince key Senators not 
to make further conceptual changes to the draft law, but to accept 
it as is. 
 
MILAS