VZCZCXRO3871
PP RUEHTRO
DE RUEHTU #0896/01 3441433
ZNR UUUUU ZZH
P 101433Z DEC 09  ZDK ZDK
FM AMEMBASSY TUNIS
TO RUEHC/SECSTATE WASHDC PRIORITY 7055
INFO RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUEAWJB/DEPARTMENT OF JUSTICE WASHDC
RHEHNSC/NSC WASHDC
RUCNMGH/MAGHREB COLLECTIVE

UNCLAS SECTION 01 OF 03 TUNIS 000896 
 
SIPDIS 
 
STATE FOR INL, S/CT, EEB, NEA/RA and NEA/MAG 
JUSTICE FOR AFMLS, OIA, AND OPDAT 
TREASURY FOR FINCEN 
 
E.O. 12958: N/A 
TAGS: EFIN KCRM KTFN SNAR PTER TS
SUBJECT: TUNISIA INTERNATIONAL NARCOTICS CONTROL STRATEGY REPORT 
PART II -- MONEY LAUNDERING AND FINANCIAL CRIMES 
 
REF: STATE 114960 
 
TUNIS 00000896  001.2 OF 003 
 
 
¶1. There is no discernible money laundering or terrorist finance 
activity occurring in Tunisia.  Tunisia is not considered an 
important regional financial center due in large part to the very 
strict control exercised by the Central Bank over financial 
transactions, particularly those involving foreign currency.  Since 
2003, Tunisia has taken important steps to create a legal framework 
for the monitoring, investigation and prosecution of money 
laundering and financial crimes.  By creating an interagency 
Financial Analysis Commission headed by the Central Bank Governor, 
Tunisia has also established effective oversight and coordination 
capabilities. 
 
¶2. In December 2003, the Tunisian Parliament passed Law No. 2003-75, 
a comprehensive counterterrorism and anti-money laundering law, to 
support international counterterrorism efforts and to establish more 
severe sentences for individuals convicted of terrorist acts.  This 
law makes it a crime to provide financial assistance or any other 
type of support to terrorist activities, and provides for the 
freezing of assets.  Those suspected of violating the law can be 
exempted from charges, however, if they report a planned terrorist 
action to authorities.  Money laundering is punishable where false 
information is proffered relating to the illicit origin of property 
or income arising directly or indirectly from an offense.  Money 
laundering is also defined as investing, depositing, transferring or 
safekeeping of property or income resulting from an offense.  The 
law does not delineate specific crimes; rather it broadly states 
that money laundering related to "a crime or infraction" is illegal. 
 Tunisia's 1992 law (Law No. 1992-52) against narcotics trafficking 
also includes provisions that contribute to combating money 
laundering.  Under Articles 2 and 30 of Law No. 1992-52, anyone 
aiding in narcotics operations or the transfer of proceeds in 
connection with these operations, including financial institutions, 
can be prosecuted. 
 
¶3. On August 12, 2009, the Tunisian legislature passed Law No. 
2009-65 as an amendment to law 2003-75.  The new law is intended to 
harmonize national legislation with UN Anti-Money 
Laundering/Anti-Terrorist Financing (AML/ATF) resolutions, and to 
implement the recommendations made in the 2007 Mutual Evaluation 
Report of the Middle East and North Africa Financial Action Task 
Force (MENAFATF).  The modifications include:  improving databases 
to prevent terrorist financial transactions; protecting the identity 
of individuals interviewed within investigation operations on 
terrorism and money laundering; extending the period allowed for a 
public prosecutor to issue his judgment on investigations carried 
out by the Financial Analysis Commission from two to five days; and 
enhancing measures for review of fund transfers, according to both 
the nature of activity to which the funds are related to and the 
financial transaction type.  Law No. 2009-65 also provides new penal 
measures, including six months to three years imprisonment and a 
fine of 5,000 to 10,000 dinars ($3,869 to $7,738) for any individual 
(including traders of jewelry and gems, managers of casinos, and 
legal representatives and agents) linked to criminal financial 
operations. 
 
¶4. According to Samir Brahimi, the Central Bank official responsible 
for coordinating Tunisia's AML/ATF efforts, the passage of Law No. 
2009-65 was deliberately timed to coincide with the passage of 
another law partially liberalizing financial services for the 
off-shore sector.  According to Brahimi, the two measures were 
released simultaneously in order to send a message that Tunisia's 
gradual opening to international financial markets would be 
carefully coordinated with AML/ATF efforts. 
 
¶5. The Tunisian penal code also allows for the sequestering, 
confiscation, or seizure of assets and property in certain 
situations, including narcotics trafficking and terrorist 
activities.  The definition of "assets" is broad and covers any 
number of financial or physical assets.  Financial assets are traced 
by the Central Bank and Financial Analysis Commission, each of which 
has broad powers for investigating and seizing financial assets. 
Following an initial freeze of assets, authorities have four days to 
present additional supporting evidence before the assets must be 
released.  At any time, the reviewing magistrate can release frozen 
assets if he or she determines the evidence does not support such 
measures.  Tunisia has no legal provisions for sharing seized 
criminal assets with other governments. 
 
¶6. In 2003, Tunisia created an interagency Financial Analysis 
Commission that includes representatives from the Central Bank, 
Ministry of Finance, Ministry of Interior, Customs and the 
judiciary.  The Central Bank Governor acts as head of the 
commission, which has both an investigatory and advisory role in 
 
TUNIS 00000896  002.2 OF 003 
 
 
combating money laundering and terrorist financing.  The Financial 
Analysis Commission has oversight functions for banks, non-banking 
financial institutions such as stock brokerages, insurance companies 
and casinos, intermediaries such as lawyers as well as 
non-governmental organizations. In April 2006, the Financial 
Analysis Commission issued a directive ordering all Tunisian banks 
to designate a compliance officer, who serves as the direct liaison 
with the Financial Analysis Commission. 
 
¶7. Under Law 2003-75, as amended, all institutions or intermediaries 
must report any suspicious, or unusual, transactions to the Tunisian 
Financial Analysis Commission and freeze related accounts. 
Financial institutions are also required to report all transactions 
above 5,000 dinars (US $3,869).  Although the Financial Analysis 
Commission reports a rise in the number of suspicious transaction 
reports (STRs) received over the past several years, this is 
attributed to better reporting rather than an actual increase in 
suspicious transactions.  In accordance with the recommendations of 
the MENAFATF Mutual Evaluation Report, Law No. 2009-65 no longer 
mandates the automatic freezing of accounts subject to an STR, but 
rather instructs banks to allow the transaction so that authorities 
can trace the destination of the funds.  To date, Tunisia has not 
had any money-laundering or terror finance prosecutions. 
 
¶8. Law 2003-75, as amended, also imposes obligations on all 
financial institutions to gather full identifying information for 
personal and business accounts.  There are no anonymous or numbered 
accounts allowed in Tunisia.  Additionally, all bookkeeping, 
accounting, and supporting  documentation, in both paper and 
electronic form, must be maintained for 10 years. 
 
¶9. Banks report regularly receiving the US Government and United 
Nations 1267 Sanctions Committee freeze lists from the Central Bank. 
 The Financial Analysis Commission reports that it has never 
discovered any accounts or assets belonging to a listed individual 
or entity. 
 
¶10. The Central Bank retains strict control over foreign currency 
operations. The Tunisian dinar is not fully convertible and it is 
illegal to export dinars.  Residents are generally prohibited from 
holding or exporting foreign currency except for certain purposes, 
such as travel or business, and are limited in the value of foreign 
currency that can be used for these purposes.  Only certain 
categories of individuals and businesses are allowed to open foreign 
currency or convertible dinar accounts and all of these accounts are 
monitored by the Central Bank. 
 
¶11. The import and export of foreign exchange is regulated by 
Article 76 of Law No. 2003-75.  There is no explicit mention of cash 
couriers or cash smuggling in Tunisian law. Non-residents must 
declare the import of foreign exchange equivalent to or in excess of 
a ceiling fixed by the Ministry of Finance.  Currently, the Ministry 
of Finance has set the ceiling at the foreign currency equivalent of 
25,000 dinars (about US $19,330).  Non-residents entering Tunisia 
with foreign currency or other instruments worth less than 25,000 
dinars are required to declare the total amount if they wish to 
re-export or deposit more than 5,000 dinars (US $ 3,869). 
Non-residents do not need to declare currency exports under 5,000 
dinars.  Customs may at any time require declarations for gold or 
securities. 
 
¶12. Although all fund transfers must go through formal banking 
institutions or the National Post Office, these restrictions and 
currency exchange controls may encourage underground methods of 
moving money or transferring value in and out of the country. 
Remittances from abroad are a major source of hard currency, though 
there is no evidence of an organized alternative transfer system 
such as hawala.  A significant black market in consumer goods does 
exist in the country but is not believed to be funded by illicit 
proceeds. 
 
¶13. All offshore financial institutions are held to the same 
regulatory standards as onshore financial institutions. Offshore 
financial institutions undergo the same due diligence process as 
onshore banks and are licensed only after the Central Bank 
investigates their references and the Ministry of Finance approves 
their application.  Anonymous directors are not allowed.  Tunisia 
currently has eight offshore banks and a considerable number of 
offshore international business companies.  Offshore international 
business companies are subject to all regulatory requirements, 
except for tax requirements and currency convertibility 
restrictions.  There are five casinos in Tunisia.  Although 
Tunisians are not legally permitted to use them, in practice 
Tunisians are able to circumvent this restriction.  Bearer financial 
instruments or shares are strictly prohibited (Act No. 35 of 2000). 
 
TUNIS 00000896  003.2 OF 003 
 
 
 
¶14. Tunisia has two free trade zones, in Bizerte and Zarzis, with a 
limited number of companies manufacturing products for export. 
There are no offshore financial institutions located in either free 
trade zone.  There have been no reports of trade-based money 
laundering or terrorist financing activities using either free trade 
zone.  Government customs officials are present on site at the free 
trade zones and at qualifying companies to supervise export 
activities.  Prior to opening a business in one of the two free 
trade zones, the company must conclude a contract with the free 
trade zone authority outlining project details, but are not required 
to produce a company history. 
 
¶15. Tunisia is a founding member of the Bahrain-based MENAFATF, 
approved in November 2004.  Tunisia is a party to both the 1988 UN 
Drug Convention and the 1999 UN International Convention for the 
Suppression of Financing of Terrorism. Tunisia has signed and 
ratified the UN Convention against Transnational Organized Crime. 
Tunisia signed the UN Convention Against Corruption in 2004, but has 
not yet ratified the agreement.  Tunisia has submitted its candidacy 
to the Egmont group.  Tunisia has bilateral agreements on "criminal 
matters" with 29 countries and is party to 12 international 
agreements on counterterrorism. 
 
¶16. Embassy point of contact is Economic Officer Pete Davis (E-mail: 
DavisPJ@state.gov; Phone: 216-71-107-431).