FATF Public Statement

The Financial Action Task Force (FATF) is the global standard setting body for anti-money laundering and combating the financing of terrorism (AML/CFT). In order to protect the international financial system from ML/FT risks and to encourage greater compliance with the AML/CFT standards, the FATF identified jurisdictions that have strategic deficiencies and works with them to address those deficiencies that pose a risk to the international financial system.

Jurisdictions subject to a FATF call on its members and other jurisdictions to apply counter-measures to protect the international financial system from the on-going and substantial money laundering and terrorist financing (ML/TF) risks emanating from the jurisdictions*.

Iran

Democratic People's Republic of Korea (DPRK)

Jurisdictions with strategic AML/CFT deficiencies that have not made sufficient progress in addressing the deficiencies or have not committed to an action plan developed with the FATF to address the deficiencies** The FATF calls on its members to consider the risks arising from the deficiencies associated with each jurisdiction, as described below.

Bolivia
Cuba**
Ethiopia
Kenya
Myanmar
Sri Lanka
Syria
Turkey


* The FATF has previously issued public statements calling for counter-measures on Iran and DPRK. Those statements are updated below.
**Cuba has not engaged with the FATF in the process.


Iran

The FATF remains concerned by Iran’s failure to meaningfully address the on-going and substantial deficiencies in its anti-money laundering and combating the financing of terrorism (AML/CFT) regime. The FATF remains particularly concerned about Iran’s failure to address the risk of terrorist financing and the serious threat this poses to the integrity of the international financial system. The FATF urges Iran to immediately and meaningfully address its AML/CFT deficiencies, in particular by criminalising terrorist financing and effectively implementing suspicious transaction reporting (STR) requirements.

The FATF reaffirms its call on members and urges all jurisdictions to advise their financial institutions to give special attention to business relationships and transactions with Iran, including Iranian companies and financial institutions. In addition to enhanced scrutiny, the FATF reaffirms its 25 February 2009 call on its members and urges all jurisdictions to apply effective counter-measures to protect their financial sectors from money laundering and financing of terrorism (ML/FT) risks emanating from Iran. FATF continues to urge jurisdictions to protect against correspondent relationships being used to bypass or evade counter-measures and risk mitigation practices and to take into account ML/FT risks when considering requests by Iranian financial institutions to open branches and subsidiaries in their jurisdiction. If Iran fails to take concrete steps to improve its AML/CFT regime, the FATF will consider calling on its members and urging all jurisdictions to strengthen counter-measures in October 2011.

Cuba

Cuba has not committed to the AML/CFT international standards, nor has it constructively engaged with the FATF. The FATF has identified Cuba as having strategic AML/CFT deficiencies that pose a risk to the international financial system. The FATF urges Cuba to develop an AML/CFT regime in line with international standards, and is ready to work with the Cuban authorities to this end.

Bolivia

Despite Bolivia’s high-level political commitment to work with the FATF and GAFISUD to address its strategic AML/CFT deficiencies, Bolivia has not made sufficient progress in implementing its action plan, and certain strategic AML/CFT deficiencies remain. Bolivia should work on addressing these deficiencies including by: (1) ensuring adequate criminalisation of money laundering (Recommendation 1); (2) adequately criminalising terrorist financing (Special Recommendation II); (3) establishing and implementing an adequate legal framework for identifying and freezing terrorist assets (Special Recommendation III); and (4) establishing a fully operational and effective Financial Intelligence Unit (Recommendation 26). The FATF encourages Bolivia to address its remaining deficiencies and continue the process of implementing its action plan, including by continuing to work on its AML/CFT legislation.

Ethiopia

Despite Ethiopia’s high-level political commitment to work with the FATF to address its strategic AML/CFT deficiencies, Ethiopia has not made sufficient progress in implementing its action plan, and certain strategic AML/CFT deficiencies remain. Ethiopia should work on addressing these deficiencies, including by: (1) adequately criminalising money laundering and terrorist financing (Recommendation 1 and Special Recommendation II); (2) establishing and implementing an adequate legal framework and procedures to identify and freeze terrorist assets (Special Recommendation III); (3) ensuring a fully operational and effectively functioning Financial Intelligence Unit (Recommendation 26); (4) raising awareness of AML/CFT issues within the law enforcement community (Recommendation 27); and (5) implementing effective, proportionate and dissuasive sanctions in order to deal with natural or legal persons that do not comply with the national AML/CFT requirements (Recommendation 17). The FATF encourages Ethiopia to address its remaining deficiencies and continue the process of implementing its action plan.

Kenya

Despite Kenya’s high-level political commitment to work with the FATF and ESAAMLG to address its strategic AML/CFT deficiencies, Kenya has not made sufficient progress in implementing its action plan, and certain strategic AML/CFT deficiencies remain. Kenya should work on addressing these deficiencies, including by: (1) adequately criminalising terrorist financing (Special Recommendation II); (2) ensuring a fully operational and effectively functioning Financial Intelligence Unit (Recommendation 26); (3) establishing and implementing an adequate legal framework for identifying and freezing terrorist assets (Special Recommendation III); (4) raising awareness of AML/CFT issues within the law enforcement community (Recommendation 27); and (5) implementing effective, proportionate and dissuasive sanctions in order to deal with natural or legal persons that do not comply with the national AML/CFT requirements (Recommendation 17). The FATF encourages Kenya to address its remaining deficiencies and continue the process of implementing its action plan, including by implementing the AML legislation and operationalising the new AML Advisory Board.

Myanmar

Myanmar has taken steps towards improving its AML/CFT regime, including by clarifying the scope of the ML offence. Despite Myanmar’s high-level political commitment to work with the FATF and APG to address its strategic AML/CFT deficiencies, Myanmar has not made sufficient progress in implementing its action plan, and certain strategic AML/CFT deficiencies remain. Myanmar should work on addressing these deficiencies, including by: (1) adequately criminalising terrorist financing (Special Recommendation II); (2) establishing and implementing adequate procedures to identify and freeze terrorist assets (Special Recommendation III); (3) further strengthening the extradition framework in relation to terrorist financing (Recommendation 35 and Special Recommendation I); (4) ensuring a fully operational and effectively functioning Financial Intelligence Unit (Recommendation 26); (5) enhancing financial transparency (Recommendation 4); and (6) strengthening customer due diligence measures (Recommendation 5). The FATF encourages Myanmar to address its remaining deficiencies and continue the process of implementing its action plan.

Sri Lanka

Despite Sri Lanka’s high-level political commitment to work with the FATF and APG to address its strategic AML/CFT deficiencies, Sri Lanka has not made sufficient progress in implementing its action plan, and certain strategic AML/CFT deficiencies remain. Sri Lanka should work on addressing these deficiencies, including by: (1) adequately criminalising money laundering and terrorist financing (Recommendation 1 and Special Recommendation II); and (2) establishing and implementing adequate procedures to identify and freeze terrorist assets (Special Recommendation III). The FATF encourages Sri Lanka to address its remaining deficiencies and continue the process of implementing its action plan, including by continuing to work on its AML/CFT legislation.

Syria

Syria has taken steps towards improving its AML/CFT regime, including by improving the ML and TF offences. Despite Syria’s high-level political commitment to work with the FATF and MENAFATF to address its strategic AML/CFT deficiencies, Syria has not made sufficient progress in implementing its action plan, and certain strategic AML/CFT deficiencies remain Syria should work on addressing its deficiencies, including by: (1) adopting adequate measures to implement and enforce the 1999 International Convention for the Suppression of Financing of Terrorism (Special Recommendation I); (2) implementing adequate procedures for identifying and freezing terrorist assets (Special Recommendation III); (3) ensuring financial institutions are aware of and comply with their obligations to file suspicious transaction reports in relation to ML and FT (Recommendation 13 and Special Recommendation IV); and (4) ensuring appropriate laws and procedures are in place to provide mutual legal assistance (Recommendations 36-38, Special Recommendation V). The FATF encourages Syria to address its remaining deficiencies and continue the process of implementing its action plan.

Turkey

Turkey has taken steps towards improving its AML/CFT regime, including by working on CFT legislation. Despite Turkey’s high-level political commitment to work with the FATF to address its strategic AML/CFT deficiencies, Turkey has not made sufficient progress in implementing its action plan, and certain strategic AML/CFT deficiencies remain. Turkey should work on addressing these deficiencies, including by: (1) adequately criminalising terrorist financing (Special Recommendation II); and (2) implementing an adequate legal framework for identifying and freezing terrorist assets (Special Recommendation III). The FATF encourages Turkey to address its remaining deficiencies and continue the process of implementing its action plan.

Source: FATF

BIMSTEC agree on convention against terror

India and six other members of a grouping of South Asia and South East Asia today agreed to firm up by November a convention to deal collectively with terrorism which is haunting these two regions.

Under the proposed convention, the member-countries of Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) would cooperate in intelligence sharing, legal and law enforcement issues, combating financing of terrorism and prevention of illicit trafficking of narcotic drugs, psychotropic substances and precursor chemicals.

"We expressed the hope that the draft BIMSTEC Convention be finalised as soon as possible for signing during the next BIMSTEC Summit," said the grouping which comprises India, Bangladesh, Sri Lanka, Myanmar, Nepal, Bhutan and Thailand in a joint statement issued after Foreign Ministerial meeting here.

The next Summit is expected to be held here in November this year.

In the field of trade and investment, the grouping resolved to conclude the negotiations on trade in goods under the proposed FTA at an early date, preferably before the next BIMSTEC Summit.

The Ministerial meeting also approved memoranda of association for setting centres for energy, weather and climate in India, tourism working group and BIMSTEC joint working group. PTI

Source: The Press Trust of India

Sri Lanka: International Conference on Countering Terrorism

Sri Lanka: International Conference on Countering Terrorism draws international terrorism experts to Colombo

20th October 2007

The three-day International Conference on Countering Terrorism is now on in Colombo on the theme 'Terrorism: A Challenge to Democratically Elected Governments.' The Conference, brought together renowned terrorism experts, including from the academia and the media, from 23 countries including Australia, China, Czech Republic, France, Germany, India, Indonesia, Russia, Singapore, South Africa, the United States and Vietnam. It was also widely attended by the Diplomatic Community .

Delivering the Inaugural Address, Foreign Minister Rohitha Bogollagama, highlighted that "Sri Lanka had been a foot soldier in the battle against terrorism over a long period of time and notwithstanding some impediments and setbacks, can in several aspects count itself as having been a success story in the battle against terrorism." Sri Lanka's refusal to compromise or condone terrorism while constantly seeking to resolve the conflict through political means, to persuade other states to proscribe the LTTE, prevent money flows and apprehend those conniving with terrorists, has been significant. Successive governments and the people of Sri Lanka have also shown considerable resilience in the face of terror, whilst also ensuring that economic growth was not compromised. The Minister hoped that the deliberations of this Conference would, among other matters focus on the need for states to go beyond merely adopting conventions, to convert these into tangible action by developing enabling legislation and taking concrete action against those including terrorist front organizations operating from their soil. Noting that a bulk of maritime traffic passes through the Indian Ocean region and that in recent times many acts of terrorism had taken place in these waters, the Minister emphasized the urgent necessity to develop robust modalities to arrest the growing threat that faces Indian Ocean states from terrorists.

The former Director of the European Center for the Study of Conflicts in France, and one of the earliest writers in the field of terrorism, Dr. Gerard Chaliand traced the evolution of terrorism over the years. Referring to the LTTE, he said "the independence they ask cannot be granted and should not be granted, not only because no State is willing to accept such a blow to its sovereignity but also because, like the Shining Path or the Khmer Rouges, the LTTE under the leadership of V. Prabhakaran is a totalitarian movement, which has transformed its groups into a killing machine." He said "the most important thing about the LTTE is that it is a totalitarian movement fighting in a country which is democratic." He said the "LTTE has brutally eliminated all other parties or groups willing to represent the Tamils". "An absolutely intolerant sect, no peace seems possible with V. Prabhakaran as we have seen from the peace process of 2002-2005, which was but a tactical truce", Dr. Chaliand added.

Secretary of Foreign Affairs, Dr. Palitha Kohona delivering the vote-of-thanks repeated the unprecedented challenge Sri Lanka faces in combating terrorism and Sri Lanka. He said the world had focused on international terrorism only after 9/11 but terrorism had affected countries long before then. He emphasized that "the international rule of law against terrorism is being strong themed each year," adding that "there are 13 UN Conventions addressing different dimensions of the global terrorist threat and a comprehensive convention is being negotiated." The Foreign Secretary pointed out that "terrorism will never be eradicated solely by cooperation among law enforcement officials. It requires a concerted political effort and policy coordination among countries. Further it also requires an ability to understand and minimize the motivation and impetus that inspire terrorist acts."

Renowned Chairman of the French Anti-Terrorist Judges, Judge Jean Louis Bruguiere, who was the Guest of Honour of the Conference, and addressing the first panel of the day focused on the international responses to terrorism, traced the manner in which international efforts at responding to terrorism have evolved over the years, stating that if the fight against terrorism is an inescapable requirement, "we owe it to ourselves to reinforce our international cooperation at every level, notably by adopting multilateral or bilateral conventions in the field of judicial cooperation as well as extradition." He said the French Government considers "that an organization like the LTTE is a terrorist organization like any other and that its activities even in the area of logistics, have to be repressed with the same vigour as for terrorist networks operating on our [French] soil and threatening us directly" and that on this basis "that in April this year the French Government had dismantled a vast network of Tamil militants who actively supported the LTTE, notably at the financial level."

This session, which was chaired by the Dean of the Faculty of Arts of the University of Colombo, Prof. Amal Jayawardena,while the discussants were the Executive Director of the Regional Centre for Strategic Studies, Dr. Rifaat Hussain and the Senior Terrorism Prevention Officer of the United Nations Office on Drugs and Crime, Vienna, Dr. Ms. Irka Kuleshnyk.

Addressing the panel on regional responses to terrorism, former Commander of the Indian Army, Gen. V. P. Malik emphasized the need to combat and defeat terrorism in all its manifestations. He said "terrorist activities anywhere will stop only when their fuel runs out." Gen. Malik who traced the important steps taken to counter terrorism in South Asia, emphasized the need for a regional strategy and cooperation, but essentially local operatives and doctrines.

Former Secretary General of SAARC, Ambassador Nihal Rodrigo, chaired this session, while the discussants comprised the Associate Research Fellow of the China Institute of International Studies, Prof. Zhang Lijun, the Deputy Director of the Russian Foreign Ministry, Mr. Vladimir Titokerni as well as the Pro-Chancellor and Director of the School of Science and Forensic Science, National Law University Rajastan, India, Prof. P. Chandra Sekharan.

The third thematic session focused on the domestic dimensions of terrorism where the head of the International Centre for Political Violence and Terrorism Research in Singapore, Dr. Rohan Gunaratna, who was the principal speaker, who joining the deliberations on a video link, highlighted the recent successes of the security forces in combating LTTE terrorism. He noted that within the year the Sri Lanka Navy destroyed eight merchant vessels. In order to defeat the LTTE, Dr. Gunaratna articulated the need for strengthening and building capacity in the intelligence field, with a high degree of professionalism, and also stressed the necessity for special forces and elite units that could target the leadership of the LTTE.

Former Inspector General of Police, Mr. Chandra Fernando chaired the discussion at which intervention were made by Deputy Solicitor General, Mr. Dappula de Livera and Prof. Karunaratne Hangawatte of the University of Nevada.

The final panel discussion of the day focused of the critical area of combating terrorist financing, where the Founder and CEO of World-Check, Mr. David Leppan spoke extensively on the manner in which terror groups collect funds and their illegal activities.

Researcher of the Centre for Policing, Intelligence and Counter Terrorism of the Macquarie University of Australia, Mr. Shanaka Jayasekera the co-speaker at this session noted that the LTTE's supply chain capability has been significantly disrupted, estimated at between 65% to 70%. This would result in the need for the LTTE to aggressively campaign for fund raising activities in the 12 top level resource mobilization countries. In order to maintain the advantage the Government has achieved, it is imperative that the fund-raising be curbed with international cooperation in the next few months. Therefore it is suggested that a contact group be established as a prelude to the commencement of a political process."

The Deputy Governor of the Central Bank, Dr. Ms. Ranee Jayamaha chaired the sessions, at which the discussants were Mrs. Joan De Zilva Moonesinghe formerly of the Financial Investigation Unit and the Advisor of the Financial Investigation Unit of the Central Bank, Mr. Eric Stonecipher.

Ministry of Foreign Affairs
Colombo

20 October 2007

Global action on counterung terror: Sri Lanka’s perspective

Excerpts from the speech by Rohitha Bogollagama, Minister of Foreign Affairs at the Australian Strategic Policy Institute, Canberra last week

Since 1963, the international community has elaborated 13 universal legal instruments to prevent terrorist acts. Those instruments were developed under the auspices of the United Nations and its specialised agencies and the international Atomic Energy Agency (IAEA) and are open to participation by all Member States.

Currently, UN Member States are negotiating a 14th international treaty, a draft comprehensive convention on international terrorism. This convention would complement the existing framework of international anti-terrorism instruments and would build on key guiding principles already present in recent anti-terrorist conventions: the importance of criminalisation of terrorist offences, making them punishable by law and calling for prosecution or extradition of the perpetrators; the need to eliminate legislation which establishes exceptions to such criminalization on political, philosophical, ideological, racial, ethnic, religious or similar grounds; a strong call for Member States to take action to prevent terrorist acts; and emphasis on the need for Member States to cooperate, exchange information and provide each other with the greater measurer of assistance in connection with the prevention, investigation and prosecution of terrorist acts.

The Global Counter-Terrorism Strategy, which was adopted by the UN General Assembly on 08 September 2006, highlighted the importance of Member States becoming parties to existing international counter-terrorism instruments and implementing their provisions without delay. This was first time that countries around the world agreed on a common strategic approach to combat terrorism.

Terrorism is, sadly, no stranger to Sri Lanka. We, in Sri Lanka, know terrorism, unfortunately, only too well. It is regrettably an everyday reality confronting us, even as we try to commute to our work places and attend to our daily chores.

We know at first hand the horrific consequences of the brutality of terrorism; the carnage, the shock and horror, the thousands of unsuspecting lives lost or maimed in the flash of a bomb explosion, the thousands of families left bereaved, the countless personal tragedies that terrorism leaves in its wake. The debilitating effects of terrorism on the psyche of the nation have been such that an entire generation has been born and raised in Sri Lanka under the dark clouds of this scourge.

Sri Lanka is a State party to 12 international conventions relating to terrorism. The most recent instrument that we ratified was the International Convention for the Suppression of Acts of Nuclear Terrorism, which was negotiated and concluded in April 2005 by the UN Ad Hoc Committee on Terrorism, under the Chair of Sri Lanka. Currently, a Bill to give effect to this Convention has been gazetted and will be presented to Parliament shortly for adoption into domestic law.

At the regional level too, Sri Lanka has played a pro-active role in galvanizing support for collective action in combating terrorism. At the recently concluded 15th SAARC Summit in Colombo, leaders of the assembled eight member states gave their blessings to the SAARC Convention on Mutual Legal Assistance in Criminal Matters, which was signed by the Foreign Ministers.

Among the key weapons in the armoury of the international community to fight terrorism is the International Convention for the Suppression of the Financing of Terrorism, which entered into force on 10 April 2002, following its adoption by the UN General Assembly in December 1999.

The speed with which member states ratified this Convention, illustrated the commitment of the international community to combat terrorism, especially in the immediate aftermath of the terrorist attacks on the US in September 2001.

In response to those attacks, the UN Security Council acting under Chapter VII of the UN Charter, adopted Resolution 1373 on 28 September 2001, which inter aliacalled upon States to “become parties as soon as possible to the relevant international conventions and protocols relating to terrorism, including the International Convention for the Suppression of the Financing of Terrorism of 09 December 1999”.

Increasingly, international terrorist activity has become interlinked with other modern scourges, such as drug trafficking and the proliferation of small arms. This Convention recognizes that financing is at the heart of terrorist activity, and it paves the way for concerted action and close cooperation among law enforcement agencies, financial authorities and States.

It calls for efforts to identify, detect, and freeze or seize any funds used or allocated for the purpose of committing a terrorist act. It urges States to consider establishing mechanisms to use such funds to compensate victims and/or their families.

The Liberation Tigers of Tamil Eelam (LTTE) which has earned international notoriety and opprobrium for its countless cold blooded and savage acts of terrorism, targeting not only high profile politicians and military personnel, but ordinary civilians, designed to cause maximum casualties and property destruction, is a prime candidate for consideration by the Working Group for listing, as an international terrorist group. The LTTE is pre-eminently qualified to meet the criteria for such listing.

After all, the LTTE has been described as “probably the most sophisticated terrorist organization in the world”, by Dr. Magnus Ranstorp, Chief Scientist at the Centre Asymmetric Threat Studies of the Swedish National Defence College. More recently, the FBI of the United States has given the LTTE the appellation as “among the most dangerous and deadly extremists in the world”.

I do hope the UN Working Group will take cognizance of the clear and present danger that the LTTE poses not only to the sovereignty and territorial integrity of Sri Lanka, but equally to the law and order as well as the stability of Western societies, which have been infected by the pernicious and malignant influence of the LTTE.

The LTTE is notorious for resorting to intimidation, extortion and even violence on the large Sri Lankan Tamil diaspora in the West to ensure a steady flow of funds to finance its terrorist campaign in Sri Lanka.

Funding from the diaspora has been the mainstay fuelling the LTTE’s terror campaign in Sri Lanka. The traditional “melting pot” paradigm, where emigrants gradually lost ties to their countries of origin and became assimilated into the social fabric of their adopted nations, is no longer the norm.

The LTTE, running a highly sophisticated and intricate international web, encompassing the whole gamut of activities ranging from seemingly innocuous pursuits, such as the promotion of Tamil culture to raising funds ostensibly to support charities and humanitarian relief in Sri Lanka, has cleverly exploited modern technology to finance its terror campaign.

In fact, although several countries including India, the United States, the United Kingdom, the 27 member European Union and Canada have proscribed the LTTE, the many front organizations of the LTTE which operate rather freely in these countries, continue to raise funds and engage in propaganda in support of the LTTE. These fronts provide a cover for the LTTE to indulge in various nefarious activities, including illicit arms procurement, human smuggling, narcotics trafficking, credit card scams and money laundering.

All too often there is a tendency to lose sight of the meticulous organization behind each act of terrorism, the extensive network of secret cells, responsible for collecting funds, procuring illicit weapons and bomb making material, and foot soldiers responsible for propaganda. The ability of the LTTE to transfer vast sums money through illicit channels, bypassing the scrutiny of Central Banks of Governments, is a major challenge in combating terrorism.

We greatly appreciate the pro-active stance of the Australian authorities in arresting and prosecuting frontline activists and sympathizers of the LTTE, notwithstanding the fact that Australia is yet to proscribe the LTTE as a terrorist organization. Hence, the arrest of three activists of the Melbourne based LTTE front, the Tamil Coordinating Committee in April 2007 by the Australian Federal Police and their subsequent prosecution on charges relating to raising funds for terrorism, is all the more welcome.

We also note that the Australian Federal Police have arrested the Director of a Melbourne business college in July this year, at the request of the FBI of the US, for his links to the LTTE, and wanted to face prosecution for alleged terrorism offences in the US.

However, much more needs to be done to pursue front organizations of the LTTE, posing off as charities and humanitarian relief groups, which continue to raise funds to fill the LTTE war chest.

In this respect, the United States has taken a bold lead in targeting the support network of the LTTE by designating the Tamils Rehabilitation Organization (TRO), which had long claimed itself to be a charitable organization, as a front to facilitate fund raising and procurement of weapons for the LTTE.”

Notwithstanding the overwhelming body of evidence that is available with several governments on the inextricable and organic link between the TRO and the LTTE, it is a matter of regret that apart from the US and the UK governments which have listed the TRO, this organization as well as numerous other fronts, representing the multi-headed hydra like character of the LTTE, are operating with impunity, thumbing a nose at the authorities in many Western countries which have a significant presence of the Sri Lankan Tamil diaspora.

Thus, the onus is now clearly upon the international community to support Sri Lanka, by taking tangible and meaningful steps to eradicate terrorism from our land, and help the government to restore democracy and rebuild the damaged infrastructure in the North and the East of the country. We believe that the true friends of Sri Lanka in the international community, who have the well being of our people at heart must put their money where their mouth is, by taking decisive action to stop funds being raised under various ruses, which are being channeled to finance the LTTE’s operations.

We strongly believe that terrorism cannot be countered by using terrorism; we reject the notion that terror must be fought by terror.

While this approach has found favour in certain quarters, giving rise to robust rules of engagement for the military to engage terrorists, in turn, resulting in collateral damage in the form of massive civilian casualties, Sri Lanka firmly believes in the protection of human rights, even as its military forces are currently engaged in freeing our people from the fascist and dictatorial control of the LTTE terrorists, who are now holed up in parts of the Kilinochchi and Mullaitivu districts in the North.

The Government of Sri Lanka is deeply concerned about the humanitarian situation of civilians in the uncleared areas, as the military operations enter a decisive phase to free these areas from the terrorists. As a responsible government, President Mahinda Rajapaksa’s administration is acutely conscious and aware of its responsibilities towards all citizens of Sri Lanka.

This is why, even as there is intensification of the military strikes against the LTTE, there is remarkably minimal collateral civilian casualties. This has not occurred by chance or a fortuitous turn of circumstances, but rather in pursuance of the government directive to the military to adhere strictly to a policy of “zero civilian casualty”, in combating terrorism.

The absence of civilian deaths in the Eastern Province clearing operations last year, except in one isolated incident where the LTTE used civilians as cover to fire at the military, is a manifestation of the success of this strategy, which we are confident, will be replicated in the ongoing operations in the North.

While it should come as no surprise that critics of Sri Lanka and sympathizers of the LTTE are attempting to portray a misleading and totally false notion that the government is opting for a military solution to address the problems of the minorities, it is unfortunate that some of our friends too have been influenced by this malicious propaganda.

Nothing can be further from the truth. In fact, President Mahinda Rajapaksa addressing the 63rd session of the UN General Assembly in New York last month, made it amply clear to the international community that the Government of Sri Lanka is firmly committed to a political solution.

The Government attaches the highest importance to the humanitarian needs of displaced persons and civilians in the areas affected by the conflict. This is an obligation and responsibility which the Government has assumed since the inception of the conflict.

The civilians who are trapped in the LTTE controlled areas are being encouraged to move out of these areas through “humanitarian corridors” created in order that the security forces can put an end to terrorism in Sri Lanka and prevent them being used by the LTTE as “human shields”.

It is highly deplorable that the LTTE is cynically exploiting the plight of innocent civilians kept prisoner against their will, for propaganda purposes. With regard to Internally Displaced Persons (IDPs) in LTTE dominated areas in the Killinochchi and Mullativu districts, the current estimate is around 250,000, of which there are 110,000 pre-2006 IDPs forced to flee to the Wanni by the LTTE from the Jaffna peninsula, another 90,000 who were displaced between 2006 and June 2008 and the rest displaced due to the on-going operations. In considering the situation of the IDPs, it is important that we bear in mind that the situation of those displaced due to the on-going military operations in the Wanni, as previously in the case of the East, is merely a temporary dislocation.

On the other hand, I wonder why the shrill voices of those who are screaming of a non-existent humanitarian catastrophe in the Wanni, are deafeningly silent on the plight of the over 100,000 Muslims who are now languishing in refugee camps, mainly in the impoverished Puttalam district and others in the Anuradhapura and Polonnaruwa districts after being forcibly evicted by the LTTE from the North. 24th October marks the 18thanniversary of the ethnic cleansing of Muslims from the North by the LTTE.

More than 75,000 Muslims were compelled to vacate their homes at gun point on this day in 1990 by the LTTE and after they were driven out of their lands, which they had inhabited from time immemorial, the LTTE went about systematically looting and pillaging the properties and valuables of these hapless people. If any proof were needed of the racist nature of the LTTE, the ethnic cleansing of Muslims from the North, speaks for itself - res ipsa loquitur.

It is very important that all those who are concerned about Sri Lanka including the welfare of the Tamil community should perceive the marginalisation of the LTTE in the correct light. LTTE does not represent the Tamil community in Sri Lanka. Therefore, military action against the LTTE should never be perceived as action against our brethren, the Tamil community. We are concerned about them and will work with them to ensure their welfare, security and aspirations since they are our fellow citizens.

Sri Lanka, a party to all major UN Conventions relating to terrorism, and playing an active role as Chair of the General Assembly’s Ad Hoc Committee on the Elimination of International Terrorism, will continue to urge all member nations to ratify them so as to give real meaning to the intent of the drafters, who have toiled through sleepless nights in lengthy and exhaustive negotiations to produce these important legally binding instruments, and thus implement their provisions in letter and spirit.

Nothing short of this commitment would suffice in the global struggle to eliminate the modern day scourge of terrorism.

Source: Daily News

Toronto non-profit raised millions for Tamil Tigers

Stewart Bell, National Post

A Toronto non-profit group wired more than $3-million to overseas bank accounts, some of them linked to the Tamil Tigers, before it was shut down by the government in June for alleged terrorist financing, says an RCMP report released yesterday.

The report, marked "Secret" but unsealed by order of a Federal Court judge, provides the first detailed look at the banking activities of the World Tamil Movement (WTM), a Toronto-based group accused of bankrolling Sri Lanka's Tamil Tigers guerrillas.

Most of the money, $1.9-million, went to an account at the Bumiputra Commerce Bank in Kuala Lumpur, Malaysia, that the RCMP report says "is utilized as a vehicle to forward money to the LTTE [Liberation Tigers of Tamil Eelam] from Canada."

The 83-page financial report is the fruit of two years of analysis of banking records seized by Canadian anti-terrorism police who are investigating a financial network run by supporters of the Tamil Tigers that allegedly raised money in Canada to buy arms for the guerrillas.

"The bank records seized ... demonstrate that the World Tamil Movement has developed an elaborate machine like entity that moves throughout the Greater Toronto Area collecting funds with extreme proficiency," the police report says.

Stockwell Day, the Public Safety Minister, announced on June 16 that his government had added the WTM to Ottawa's official list of terrorist groups, alongside the likes of Al-Qaeda, Hamas and Hezbollah. The WTM is the first Canadian community group to be listed.

The WTM has denied any involvement in terrorist fundraising and vowed to challenge the government's decision, and at a large outdoor rally in Toronto on July 5, Tamils waved Tamil Tigers flags and endorsed a statement condemning Ottawa's decision to ban the WTM.

The Minister has accused the WTM of transferring money to LTTE bank accounts in Sri Lanka, but the RCMP's Feb. 1, 2008, financial report paints a more detailed picture of a complex network made up of 20 Canadian bank accounts.

Five banks held the accounts: Toronto Dominion, Bank of Nova Scotia, Royal Bank, CIBC and the National Bank of Canada. The Canadian account holders wired money regularly to accounts in Malaysia, Singapore, the United Kingdom and Tamil Tigers-controlled areas of Sri Lanka.

RCMP Corporal Deanna Hill, the author of the police report, wrote that the WTM's financial set-up was "congruent with the money laundering techniques often employed by organized crime groups.

"I also believe that the number of accounts alone demonstrate that the World Tamil Movement has utilized the Canadian banking system to raise funds in a manner that is best suited to financing the terrorist activities of the LTTE."

The Tamil Tigers have been fighting for 25 years for an independent homeland for Sri Lanka's ethnic Tamil minority, which has faced discrimination under the island's Sinhalese majority.

In addition to fighting a conventional guerrilla war, however, the Tigers also employ terrorist tactics, such as suicide bombings and political assassinations, which has landed them on international terrorist lists, Canada's included.

The RCMP began investigating the Tamil Tigers' Canadian fundraising network in 2002, focusing on the WTM's large head office in Toronto and its smaller branch offices in Montreal and Vancouver. Police raided the Toronto and Montreal offices in 2006.

Police seized letters from the Tamil Tigers leadership thanking Canada for its donations, explaining how the money had been used to purchase weapons, and asking for more. But much of the police evidence appears to have come from a study of bank accounts held by the WTM and its officers.

The Project Osaluki financial report claims the WTM's most lucrative fundraising method was a pre-authorized payment program, in which the group persuaded hundreds of its supporters to sign forms allowing money to be withdrawn from their bank accounts each month.

The WTM took in up to $763,000 a year using the payment scheme. On a single day in 2005, the WTM withdrew $63,528 from 1,582 bank accounts. "It is obvious from the amounts collected with this method that the pre-authorized payment scheme is effective, timely and spares valued resources," says the RCMP report.

Most of the forms had been signed in Canada but police also interviewed witnesses who said they had signed them at Tamil Tigers checkpoints in Sri Lanka. "Upon their return to Canada, these persons were visited by representatives of the World Tamil Movement to exact the collection of the monthly stipend," Cpl. Hill wrote.

In addition, the WTM made money through bake sales, car washes, newspaper sales, merchandise sales and festivals, the report says. "To date, the total amount of Canadian dollars that have been forwarded to accounts internationally from accounts controlled by the World Tamil Movement in Canada is $3,101,803.33."

Source: National Post

Non-profit Tamil group added to terrorism list

Stewart Bell, National Post
Published: Monday, June 16, 2008

TORONTO -- A Toronto-based non-profit organization has been outlawed by Cabinet under the Anti-Terrorism Act, in what may signal an aggressive new approach to combating terrorist financing in Canada.

The decision to add the World Tamil Movement to Canada's list of outlawed terrorist groups marks the first time Ottawa has used the anti-terrorism law to shut down a Canadian community group for ties to terrorists.

Stockwell Day, the Minister of Public Safety, was expected to make the announcement in Toronto today at 1 p.m. but financial institutions were officially notified at 9 a.m. this morning by Canada's banking regulator.

The directive issued by the Office of the Superintendent of Financial Institutions advised banks and insurance companies to notify the RCMP or CSIS if they hold any accounts linked to the WTM.

The announcement may mark the end of the road for the WTM, which has operated in Canada since the 1980s. Earlier this year, the RCMP seized dozens of bank accounts linked to the group's officers and shut down its Montreal branch office.

The Anti-Terrorism Act, passed in the wake of the 9/11 attacks, allows federal Cabinet to prepare a list of "entitites" whose activities are proscribed by Canadian law due to their involvement in terrorist violence.

Until today's announcement, there were 40 listed entities, all of them groups directly engaged in violence, such as al-Qaeda, Hezbollah and Hamas. Although the law allows for the listing of front or support groups, Cabinet had so far refrained from doing so.

Because this is a first, it is unclear what will happen next. The listing makes it illegal to financially support the group. Presumably, the WTM offices in Canada would be forced to close and cease operations. The group could also appeal the ruling.

The WTM has been under close police scrutiny. Headquartered in Scarborough, Ont., the group is accused by Canadian police and intelligence of being the leading front organization for the Tigers, a separatist guerrilla group responsible for scores of terrorist attacks in Sri Lanka.

RCMP national security teams have been conducting a criminal probe of the WTM since 2003, and raided its offices in Toronto and Montreal in April 2006, seizing a truckload of documents and Tigers paraphernalia.

In court, RCMP officers claimed to have found evidence indicating the WTM serves as a Tigers front and has been aggressively fundraising in Canada in close concert with Tigers headquarters in Sri Lanka.

Many Tamil-Canadians support the Tamil Tigers, considering them freedom fighters, but other have complained to police about the heavy-handed fundraising tactics of the WTM, which some have likened to extortion, but the group, while it admits it is sympathetic to the Tigers, has repeatedly denied any wrongdoing.

Isolated on a small island, the Tigers are heavily dependent on outside sources of financing, which they use in part to purchase the weapons needed to prosecute a civil war that has been reignited by the collapse of a ceasefire agreement and the withdrawal of international monitors.

The Liberation Tigers of Tamil Eelam, or LTTE, have been fighting since 1983 for a separate state for Sri Lanka's ethnic Tamil minority but in addition to traditional guerrilla tactics, the group has resorted to such terror tactics as suicide bombings, targeted political assassinations of leading government figures as well as the bombing of buses, trains and commercial buildings.

As home to the world's largest ethnic Tamil populations, Canada has also become an important offshore base for the rebels, which control several front groups in Toronto that harness political and financial support to finance the ethnic insurgency half-a-world away.

Canada outlawed the Tigers under the Anti-Terrorism Act in 2006 but fundraising and other forms of support have continued. Late last year, thousands of Tamil-Canadians converged at the Markham Fairgrounds north of Toronto to attend funeral services for S.P. Thamilselvan, the second-in-command of the LTTE, who was killed in a government air strike. Several Toronto-area Liberal MPs also attended and later defended their actions.

sbell@nationalpost.com

Source: National Post

Sri lanka, US discuss money laundering

Sri Lanka and the US discussed the implementation of anti-money laundering laws, which are of mutual interest. Minister of Enterprise Development & Investment Promotion Dr. Sarath Amunugama assured Deputy Assistant Secretary to the US Treasury that Sri Lanka’s Parliament has already passed the relevant legislation.

Dr. Amunugama had talks with the Deputy Assistant Secretary to the US Treasury in Washisngton DC. He was accompanied by Ambassador Jaliya Wickramasuriya at the talks.

The United States and Sri Lanka also discussed the present financial crisis in many parts of the world and steps taken to avert further damage to world economies.

Amongst the matters discussed at the meeting were the state of the Sri Lankan economy and US assistance received for development projects. The Deputy Assistant Secretary explained steps being taken by the US Government to meet the current economic crisis.

The meeting highlighted Sri Lanka’s efforts towards development and helped to assess any potential spill-over from the threatening economic downturn affecting financial markets in the US and other parts of the world. Dr. Amunugama, a former Finance Minister, lent a ear to what was being said and done regarding the present crisis.

The Minister of Enterprise Development & Investment Promotion extended an invitation to officials of the US Treasury to visit Sri Lanka in order to follow up on the anti- terrorism legislation and further strengthen cooperation between the two countries.

Source: Asian Tribune

Choking charity route to terror financing

by Sandeep Dikshit

An international conference on countering terrorist financing of charity organisations quietly got under way here on Monday, with a strong representation from India and its neighbours.

Quarterbacked by the United States, the conference is being held against the backdrop of increasing international realisation that charities are being used for financing terrorist activities.

Officials from Afghanistan, Pakistan, Sri Lanka, Nepal, Bangladesh and Maldives, apart from the U.S and India, are attending the event.

Hosted by the U.S. Embassy and the Asia Pacific Group on Money Laundering, it aims at promoting government action to prevent terrorist outfits from exploiting humanitarian or religious charities as a way of concealing the illegal international movement of funds.

At the conference, technical experts, under the Asia Pacific Group on Money Laundering, are exploring best practices and a wide range of options for cooperation to protect the charitable sector from this regional and global threat. The U.S. is aware of the need to strike the right balance. Charities complicit in terrorist groups must be shut down and adequate oversight is required to promote transparency, but the world must ensure safe alternative channels to provide charity in critical areas such as humanitarian services.

International financial flows came under scrutiny after the financial system in the 1990s provided for seamless movement of funds across the world.

Source: The Hindu

Sri Lanka: Request for AML Software

By Jithendra Antonio

Sri Lanka Bankers Association (Guarantee) Limited (SLBA) has recently called for Request For Proposals (RFP) to implement an Anti Money Laundering (AML) Software in member institutions. “Our main objective is to prevent anti money laundering activities and anti terrorist financing programmes” said Secretary General, SLBA Upali De Silva speaking to the Daily Financial Times.

He stressed that adoption on Anti Money Laundering technologies has become a global phenomenon as financial institutions around the world increasingly see the need to comply with regulatory measures on anti money laundering and anti terrorist financing programmes. He also said that the relevant legislation has already been passed and the Financial Intelligent Unit (FIU), a division of the Central Bank of Sri Lanka (CBSL), is charged with the administration of the provisions of relevant Parliament Acts. The Sri Lankan Bankers Association (SLBA) will coordinate implementation of AML Software among the member institutions as a facilitator” he said. Sri Lanka Bankers Association is a Guarantee company representing the interests of the Licensed Commercial Banks and larger Licensed Specialised Banks in Sri Lanka.

Secretary General SLBA Upali De Silva said that banks are required to submit any suspicious transaction that takes place in customer accounts and any nature of a large change in the financial accounts status of their customers to Central Bank, under the regulations. “If banks do not comply with these regulations and if they don’t query on such issues from relevant customers when the banks are questioned by Central Bank, even the Chief Executive Officer of the bank could end up in jail” Mr. De Silva added.“SLBA invites proposals from reputed experienced and eligible software service providers for the supply and implementation of an uniform software solution for banks to monitor, investigate and report transactions of a suspicious nature to the Financial Intelligence Unit at CBSL on priority basis, online” said Mr. De Silva. At the moment each and every bank operating in the country is required to submit details to Central Bank via in the form of data stored in compact disks on any nature of transactions that take place which exceed Rs.1 million in value. “This value was earlier Rs.500,000 and six months ago it was changed to Rs.1million since there are large number of transactions that take place in banks at the range of Rs.500,000 to Rs.1million.” explained Mr. De Silva.

According to SLBA the proposed software solution should contain modules on Know Your Customer Concepts, Transactions Monitoring, Entity Resolution, Compliance Reporting and Investigation Tools in order to enable banks to confirm to the requirements of Prevention of Money Laundering Act No. 5 of 2006, Convention on the Suppression of Terrorist Financing Act No. 25 of 2005, Financial Transaction Reporting Act No. 6 of 2006 and Minimum Standard Rules issued by the FIU in May 2007. “The overall cost of the AML Software implementation will be distributed among banks upon each and every bank’s volume of business after selecting a particular vendor” said Upali De Silva highlighting that after the system implementation the banks will be able to update relevant customer transaction informations online via a secure online environmental platform.

Interested parties could request for RFP document after making a non-refundable deposit of Rs. 50,000 by way of bank draft drawn on a bank in Colombo favouring SLBA (Guarantee) Limited from Monday April 27th 2009 4 pm to Monday May 11th 2009 either electronically via slab@sltnet.lk or by personal application or by post addressed to Secretary General of SLBA (Guarantee) Limited, Ceylinco House, 8th floor ,No: 69, Janadhipathi Mawatha, Colombo 01.

Source: Daily Mirror

Sri Lanka FIU signed MOUs with FIUs of Philippines and Nepal

The Financial Intelligence Unit (FIU) of Sri Lanka recently signed Memoranda of Understanding (MOU) with FIUs of Philippines and Nepal to share financial information to facilitate the investigation and prosecution of persons suspected of money laundering and terrorist financing.

The signing ceremony was held in Brisbane, Australia during the Annual Meeting of the Asia Pacific Group on Money Laundering, said the Central Bank of Sri Lanka in a press release.

FIUs have been established in more than 130 countries as dedicated institutions to facilitate fight against money laundering, terrorist financing and other unlawful activities.

In Sri Lanka the FIU was established in 2006 under the Financial Transactions Reporting Act (FTRA) No.6 of 2006 and now operates in the Central Bank of Sri Lanka.

It also said money launderers and terrorist financiers are most often internationally connected and operate across borders. Financial intelligence and authorities also need to be internationally organized to fight these activities. Therefore, there is a need for FIUs to co-operate with each other and to exchange information.

MOUs will facilitate greater co-operation and co-ordination among FIUs in the exchange of financial intelligence.

The FIU-Sri Lanka has already entered into MOUs with Malaysia, Afghanistan, South Korea and Indonesia. Arrangements are currently being made to sign similar MOUs with other FIUs in the region including India, Bangladesh and Japan.

Source: Isria

Sri Lanka still probing hedge fund aid to Tamil charity

Sri Lanka is continuing investigations into financial support given to a Tamil charity with alleged terrorist links by a US hedge fund manager who was arrested for fraud, a senior official said.

Sri Lankan Central Bank governor Ajith Nivard Cabraal told LBO the banking regulator was still investigating contributions made by Raj Rajaratnam, founder of the Galleon hedge fund, to the Tamils Rehabilitation Organisation (TRO).

A probe into violations of exchange control regulations was a separate case, he said.

The Central Bank in a separate statement said that "investigations are yet continuing in relation to the funding allegedly provided by Mr Raj Rajaratnam to the TRO."

The statement said: "Accordingly, any reports that suggest that such investigations are concluded or that Mr Rajaratnam has been cleared of possible involvement are incorrect and misleading."

The statement was apparently referring to comments made by the central bank's investigations unit chief, D.K. Wijesuriya, to a foreign news agency that the regulator had cleared the US fund manager of funding terrorism.

The central bank in September 2006 froze the bank accounts of the TRO which was operating as a charity in the country’s north and east.

The move at the time followed raids on the TRO's overseas offices and arrests of people connected to it which raised doubts about the use its funds.

The authorities suspect funds given to the Tamils Rehabilitation Organisation found their way to the Tamil Tigers, whose 30-year war for a separate state in Sri Lanka's north and east ended in May when they were defeated by government forces.

The central bank has said that the TRO in Sri Lanka had received large sums of money from its branches in several foreign locations through the island's banking system purportedly for humanitarian projects.

The TRO's accounts were frozen in 2006 under new law enacted at the time to counter terrorist financing after Sri Lanka signed the International Convention for the Suppression of Terrorist Financing adopted by the United Nations General Assembly.

US media has said investigators also probed Rajaratnam's contributions to the TRO to see whether the funds were channelled to the Tamil Tigers.

Rajaratnam's lawyers have rejected the charges of insider dealing and said his contributions to the TRO were meant to help people whose homes were destroyed by the Indian Ocean tsunami.

Source: Lanka Business Online

Tamil Tiger suspects on trial for Paris racket

Twenty-two suspected Tamil Tiger rebels went on trial today for running an extortion racket among Paris &aposs ethnic Tamil diaspora to fund their separatist struggle in Sri Lanka.

The defendants include Nadaraja Matinthiran, the alleged leader in France of the Liberation Tigers of Tamil Eelam (LTTE), which is accused of extorting some USD 7.4 million from the country&aposs 75,000 Tamils.

Also in the dock is a group called the Tamil Coordination Committee in France, believed to be a legal front for the LTTE, which has been listed as a terrorist organisation by the European Union since 2006.

Experts believe the Tamil Tigers exert a controlling influence over the political life of the 1.5-million-strong world Tamil diaspora, in many cases levying a"revolutionary tax"based on household size and income.

Most of the Paris suspects were arrested in April 2007 and charged with criminal conspiracy to commit acts of terrorism, financing of terrorism or racketeering to finance terrorism.

Defence lawyer Gilles Piquois called at the outset for the case to be thrown out, arguing that the LTTE was not considered a terrorist organisation by the Sri Lankan government in 2007 when the charges were brought.

Sri Lanka lifted the terrorist designation for the Tamil separatists in 2002 following a Norwegian-brokered ceasefire, but reinstated it in 2009 after the truce agreement broke down.

Source: PTI

Blocking terrorists' funds

Terrorism is a global phenomenon. The world's foremost terror groups, including al-Qaeda and the Liberation Tigers of Tamil Eelam, have spread their menacing tentacles everywhere. They may operate in one country or regionally, but they have a financial network that spans the globe.

Terror groups need funding on a massive scale to maintain and train their cadres, procure weapons/equipment illegally, plan acts of sabotage, engage in false propaganda campaigns through several media and recruit new personnel.

With the banning of terrorist groups in many countries, they have found it impossible to raise funds under their own names. This is where their front organisations come in.

The LTTE is a master of this game, having several humanitarian and cultural front organisations which actively collect funds for the conflict back in Sri Lanka under the very noses of authorities in the countries they operate in.

In the case of the LTTE, the Tamil diaspora is coerced into 'donating' funds. But the LTTE, and indeed other terrorist groups, have not stopped there. They have a raft of legitimate business interests, whose profits are funnelled to fund terror.

India's National Security Adviser M.K. Narayanan has exposed this brazen method of terror groups. He has revealed that terrorist groups including the LTTE are manipulating stock markets to raise funds.

Terrorism and security experts say this is a new development. Terrorist groups used to target stock exchanges for terror attacks, but having failed to make any major impact, they have apparently followed the old adage "if you can't beat them, join them".

Terrorist groups find stock exchanges particularly attractive since large transactions can be effected routinely without any suspicions being raised.

Terrorists had funded bourse activities through legitimate businesses, including restaurants, real estate and shipping.

Intelligence agencies face a huge hurdle here as these businesses cannot be banned outright because they are legal for all intents and purposes.

While some of these companies actually do exist, there are instances of fictitious or notional companies engaging in share market transactions. Some of these "companies" were later traced to terrorist outfits.

Terror groups also use legitimate banking channels to remit funds for their deadly campaigns. Narayanan has rightly called for the lifting of "banking secrecy" in terrorist-related cases.

All indications are that Governments around the world are waking up to this threat and working together to stem the flow of funds to terrorists.

After all, terrorism anywhere is a threat to peace everywhere. The UN's conventions against terrorist financing are thus a step in the right direction.

In this context, we must commend Indian Prime Minister Manmohan Singh for vowing to stop terror groups from covertly raising funds for their operations on India's stock markets.

India's reassurance in this regard is significant in more ways than one. India is our closest neighbour, a dear friend that has always stood for Sri Lanka's territorial integrity and sovereignty.

India has also emerged has a frontline campaigner against global terrorism. It has banned many terror groups including the LTTE, which has been accused of assassinating former Prime Minister Rajiv Gandhi.

It is undeniable that the LTTE has been operating in India in spite of the ban, though not overtly. India knows that the terror group is a threat to its security as well.

Even as India vowed to block LTTE fund raising through its stock markets, the Indian Coastguard has detected boatloads of LTTE weapons and arrested several LTTE cadres.

Alarmingly, one consignment of weapons and explosives was being smuggled into India perhaps for a major attack there.

Clearly, terrorist groups are using a variety of methods to achieve their aims. Military crackdowns apart, the constant surveillance of their vast financial networks has become essential to eliminate the ambitions of terror.

http://www.dailynews.lk/2007/02/17/main_Editorial.asp

Indonesians plead guilty for trying to export arms illegally

BALTIMORE (AP): Two Indonesian men have pleaded guilty to tryingto illegally export arms to Indonesia through undercover U.S.federal agents, a sting that also netted a suspectedinternational arms dealer and three men associated with the SriLanka rebel group the Tamil Tigers.

Reinhard Rusli, 33, and Helmi Soedirdja, 34, who also pleadedguilty to money laundering, represented one of two conspiraciesthat federal agents allege were being orchestrated by suspectedinternational arms dealer Haji Subandi of Indonesia. They enteredtheir pleas in court Tuesday.

Reinhard and Helmi, as well as the other men, were swept up inan undercover operation conducted by U.S. Immigration and CustomsEnforcement, the FBI and the Defense Criminal InvestigativeService.

The pair contacted undercover agents to acquire night visionand holographic weapons sight devices, which they said would beused by the Indonesian military. The hardware they were trying tobuy was on a list requiring a special license or permission fromthe U.S. State Department to export them.

"The technology itself could be extremely dangerous if it falls into the wrong hands," said Jim Dinkins, acting specialagent in charge of ICE's office in Baltimore. "It couldeventually be used against the United States."

In the other conspiracy, Subandi made numerous requests to theundercover agents between March 2004 and April 2006 on behalf ofTamil Tigers to acquire night-vision goggles, special forcesweaponry, communication devices, sonar technology and unmannedaerial vehicles, according to a federal indictment.

Subandi has been charged with Haniffa Bin Osman and ErickWotulo. They are charged with conspiracy to export arms andmunitions, conspiracy to provide material support to a foreignterrorist organization, and money laundering. ThirunavukarasuVaratharasa, 36, of Sri Lanka, also is charged with being part ofthe conspiracy.

Authorities said that among the weapons Osman sought topurchase were surface-to-air missiles.

All the men were arrested in September in Guam, where they metto examine the weapons, which weighed 3.5 tons and filled up 14pallets in a truck. They remain in federal custody, and a trialwas scheduled for May 14 in federal court in Baltimore.

The Tamil Tigers are a rebel group that began fighting in 1983for a separate state on Sri Lanka. The group was added to the U.S. State Department's list of foreign terrorist organizationsin 1997. The designation bars the group from raising money,obtaining weaponry or lobbying for support in the United States.

Reinhard and Helmi face a maximum sentence of 20 years inprison, followed by five years of supervised release and a$500,000 (euro385,000) fine for money laundering and 10 years inprison, followed by three years of supervised release and a$1,000,000 (euro770,000) fine for attempted exportation of arms.

U.S. District Judge Catherine Blake scheduled sentencing forReinhard and Helmi for April 27. (**)

http://www.thejakartapost.com/detailtoplatest.asp?fileid=20070131103929&irec=0

Sri Lanka opposition raises money laundering issue in parliament

09-12-2006

Sri Lanka\'s main opposition party has said the government should investigate suspected money laundering transactions in the Colombo Stock Exchange, when the vote on the finance ministry\'s budget was taken up in parliament this week.

UNP Parliamentarian Bandula Gunawardene, a former deputy finance minister said Sri Lanka is gaining a reputation as a place for money laundering with investors becoming concerned, after questions were raised at an investment forum in Singapore last month.

Concerns have also been raised in the media in Sri Lanka about several suspected financial transactions, on the Colombo Stock Exchange.

Analysts allege that some deals bear the classic hallmarks of a second-phase money laundering transaction known as \'layering\', in which at least two foreign commercial banks are said to be involved.

They also say there could be another case where co-mingling of assets is taking place, though authorities are yet to take action.

Gunawardene says action should be taken investigate suspect transactions, by the Financial Intelligence Unit, which was especially set up to counter money laundering.

He is one of a group of opposition parliamentarians who have asked for a select committee to probe the appointment of Central Bank Governor Nivard Cabraal over his alleged links to GoldQuest.

Gunawardene speaking in parliament said when N M Perera had charged from the opposition that Dudley Senanayake was helping the business interests of Robert Senanayake - who is current UNP Chairman Rukaman Senanayake\'s father - an all-party select committee had been immediately appointed.

The Committee had found him innocent and N M Perera had later apologised. Gunawardene said those were the rich traditions of the parliament in Sri Lanka in bygone days.

Gunawardene asked why the government was reluctant to appoint a select committee, so that Governor Nivard Cabraal could be given a chance to clear his name if he was innocent.

A scandal erupted in the country after a special investigation unit that was instrumental in the arrest of several GoldQuest activists under Sri Lanka\'s anti-pyramiding, was suddenly disbanded by the Central Bank after Cabraal became its governor.

The Financial Intelligence Unit also functions inside the Central Bank.

Gunawardene says the government should also reveal what progress has been made in the investigations against pyramid schemes which were preying on youth in outstation areas.

http://www.lankaeverything.com/vinews/business/20061209005340.php

United States opposition to Sri Lanka’s Prevention of Terrorism Act Solely to prevent human rights abuse of Tamil minority

Fri, 2006-12-08 16:50
Daya Gamage – US Bureau Asian Tribune News Analysis

Washington, D.C. 8 December (Asiantribune.com): On eve of Sri Lana’s re-introduction of the Prevention of Terrorism Act (PTA) to combat Tamil Tiger terrorism and those who are associated directly or indirectly with separatism including that of propagation, the American ambassador Robert O. Blake gave a subtle warning that he would not prescribe USA Patriotic Act type laws as "civil liberties, frankly, are already under strain here."

"So, I wouldn’t want to suggest other things that might further imperil them," he further noted.

The American ambassador very diplomatically, in his state-controlled TV network Rupavahini interview in early December 2006 and carried in full by state-controlled Daily News on 5 December, opined for what purpose the 2001 USA Patriot Act as opposed to the Sri Lanka’s PTA is being used, and the difference of the two constituencies in which the two laws are implemented.

Asked as to why Sri Lanka should not defend itself in pursuing terrorists when the United States is pursuing terrorists, America’s top diplomat in Sri Lanka, gave a signal to his host country administration saying “I think it is dangerous to make comparisons between one country and the next. Every single country is different. In our case, the terrorists that we are pursuing are mostly stateless organizations like Al Qaeda that are not based in any single country” clearly indicating that his country is faced with global terrorism that has no territory and that Sri Lanka’s terrorists are ‘non state players’ domiciled in the country.

The American ambassador, who would have by now read the history of the PTA and its operation in the years that was in place well recorded in the Colombo American Embassy-produced annual human rights reports of the US State Department, knew how well he could answer ‘tricky’ questions of a government-paid journalist to get his country’s endorsement for the re-introduction of the Prevention of Terrorism Act (PTA)

Blake, whose previous posting was New Delhi where he was Deputy Chief of Mission who mostly handled American affairs in India due to the prolonged medical problem of his ambassador, already knew Sri Lanka’s national question, its relations to India and the role played by the international community before he assumed as Chief of Mission in Colombo, reflected the US State Department sentiment that LTTE terrorism has not an issue in the Asian region and that it is confined to Sri Lanka involving the 12.5% ethnic Tamil minority: "I think the LTTE has been very careful about confining their operations to Sri Lanka because they are aware of the fact that if they should do so they do not want to antagonize particular neighbors like India. So they have been very careful and I think they have realized that one of the greatest strategical mistakes they made in their history was targeting Rajiv Gandhi."

In his Rupavahini interview, Ambassador Blake, on solution to the national question, reflected his country’s long-standing opinion that "the answer to this question is not a counter-terrorism or military solution. There also has to be a parallel political strategy where the Government advances a power-sharing proposal of some sort."

He further said: "But, we believe that negotiations have to take place within an undivided state and that there has to be some sort of devolution to the Tamil areas that will meet the aspirations of the people of those areas."

To the question whether the 2001 USA Patriot Act helped the United States, Blake answering in the affirmative gave a valuable hint: "But, at the same time, there has been a very strong realization that there has to be a strong respect for civil liberties in America. I think there has been a good, healthy debate about that in the US…"

The core issue for the United States during the period the PTA was in operation was civil liberties, human rights and the rights of the ethnic Tamil minority which is caught in the middle of Sri Lanka’s national question.

The Tamil Makkal Viduthalai Pulikal (TMVP) led by LTTE-breakaway Karuna Amman in a statement to Daily Mirror carried in its 8 December edition said it was unhappy with the government’s move to re-introduce the PTA owing to concerns it would open the doors for the harassment of ordinary Tamil civilians. It cautioned that the PTA could give the LTTE the chance to further its cause if the laws are misused as was the case prior to the (2002) ceasefire agreement with the Tiger rebels ultimately insisted on a separate state for the safety of the Tamil community.

Definition of ‘terrorism’: According to new definition spelt out by the government

• ‘terrorism’ means any unlawful conduct which:

• involves the use of violence, force, coercion, intimidation, threats, duress, or

• threatens or endangers national security, or

• intimidates a civilian population or a group thereof, or

• disrupts or threatens public order, the maintenance of supplies and services essential to the life of the community, or

• causing destruction or damage to property, or

• endangering a person’s life, other than that of the person committing the act, or

• creating a serious risk to the health or safety of the public or a section of the public or,

• is designed to interfere with or disrupt an electronic system, and which unlawful conduct is aimed at or is committed with the object of threatening or endangering the sovereignty or territorial integrity of the Democratic Socialist Republic of Sri Lanka or that of any other recognized sovereign State, or any other political or governmental change, or compelling the government of the Democratic Socialist Republic of Sri Lanka to do or abstain from doing any act, and includes any other unlawful activity which advocates or propagates such unlawful conduct.

(ii) ‘specified terrorist activity’ means, offences specified in the Prevention of Terrorism Act, offences under the Public Security Ordinance No. 25 of 1947 and Regulations made thereunder, offence under section 3 of the Prevention of Money Laundering Act No. 5 of 2006, offence under section 3 of the Convention on the Suppression of Terrorist Financing Act No. 25 of 2005, and offences under sections 114, 115, 116, 117, 121, 122, 128, 129 of the Penal Code (Daily Mirror 8 December 2006)

The American Embassy’s well researched annual official document on human rights in Sri Lanka has been very critical of the government’s use of the PTA during the late nineties and until it was lifted in 2002. Sri Lanka’s human rights record, along with other countries, is annually presented to the US Congress as mandated by the Foreign Assistance Act.

Hiding behind the phrase ‘observers claim’, the human rights report for the year 2002 noted: "Observers claim that the PTA, like the ER repealed in 2001, permitted arbitrary arrests of Tamils."

In another US government official documents stated: "The PTA makes confessions obtained under any circumstances, including by torture, sufficient to hold a person until the individual is brought to court. In some cases, the detention may extend for years."

Country Report on Human Rights Practices on Sri Lanka for the year 2000 carried the following observation:

"Large-scale arrests of Tamils continued during the year; these arrests were particularly prevalent after LTTE bombings, when many young Tamils were detained or arrested on suspicion of being LTTE cadres or sympathizers. The Government detained more than 2,819 persons under the ER and PTA from January to August 31, a higher number than that for all of 1999. Many detentions occurred during operations against the LTTE. Most detentions lasted several days to several months. The number of prisoners held at any given moment under the ER and the PTA consistently remained close to 2,000. Hundreds of Tamils indicted under the PTA remained without bail awaiting trial, some for more than 2 years. The high courts held hearings on 1,000 cases under the PTA or ER during the year.

"Many such cases drag on for years. On January 7 and 15, security forces detained several thousand Tamils in Colombo and the surrounding suburbs in "cordon and search" operations meant to find LTTE cadres after suicide bomb attacks (see Section 1.a.).

"Although authorities eventually arrested fewer than 100 persons, many of those rounded up for questioning spent hours in detention, often without access to sanitary facilities. On March 18, police at a Colombo checkpoint detained and publicly strip-searched one woman, who turned out to be Sinhalese, on suspicion of being an LTTE suicide bomber. On May 30, police detained hundreds of Tamils in downtown Colombo for almost 5 hours of questioning.

Approximately 50 of the detainees were taken for photographing and further questioning. In addition those arrested, most of whom were innocent of any wrongdoing, sometimes were detained in prisons with convicted criminals. Many lesser incidents of this sort occurred during the year. Tamils complained that they were abused verbally and held for extended periods at the security checkpoints that have been set up throughout Colombo (see Section 1.d.). The Government justified the detentions and arrests on security grounds, but many Tamils claimed that the detentions and arrests were a form of harassment. Tamils often suffered arbitrary searches in their homes."

Country Report on Human Rights Practices on Sri Lanka for the year 2001 made these observations:

"Large-scale arrests of Tamils continued during the year. Many detentions occurred during operations against the LTTE. Most detentions lasted a maximum of several days although some extended to several months. The number of prisoners held at any given moment under the ER and the PTA fluctuated between 1,500 and 2,000.

Hundreds of Tamils charged under the PTA remained in detention without bail awaiting trial, some for more than 2 years. The high courts held hearings on just over 500 cases under the PTA or ER during the first 8 months of the year. Many such cases drag on for years. During the week following the July 24 attack on Colombo's main airbase and international airport, security forces detained hundreds of Tamils in the Colombo region for questioning. In addition, those arrested sometimes were held in prisons with convicted criminals. Although most of the Tamils who were detained were released within a matter of hours, many were held overnight, with some held for several days. Cordon and search operations occurred regularly throughout the country during the year, although on a much smaller scale. Tamils complained that they were abused verbally and held for extended periods at security checkpoints throughout Colombo (see Section 1.d.) The Government justified the detentions and arrests on security grounds, but many Tamils claimed they constituted harassment. Tamil homes were often searched arbitrarily. In January 2000, security forces detained several thousand Tamils in Colombo and the surrounding suburbs in cordon and search operations meant to find LTTE cadres after suicide bomb attacks. Although authorities eventually arrested fewer than 100 persons, many of those rounded up for questioning spent hours in detention."

And, the 2002 State Department report said:

"In 1999 the U.N. Working Group on Enforced or Involuntary Disappearances made its third visit to the country. Its report, released in December 1999 cited the PTA and ER as important factors contributing to disappearances and recommended the abolition or modification of these laws to bring them into conformity with internationally accepted human rights standards. The ER was repealed in 2001 and there were no arrests under the PTA during the year; however, some arrests were being made without proper procedures and the Government had not all persons detained under the PTA in previous years at year's end (see Section 1.d.). The reviewing process for some cases still was ongoing at year’s end."

The U.S. Department of State commenced, since 2003, the preparation of a separate report to the Congress titled ‘Supporting Human Rights and Democracy: The US Record’. In its 2002-2003 report, released on 24 June 2004, stated in its Sri Lanka section: "The Government’s arbitrary arrests of Tamils has been a serious human rights problem. During the year, the U.S. supported projects to address the Prevention of Terrorism Act (PTA) and to insure that no new arrests under the PTA occurred."

The most interesting admission by the United States Government in the above report, for the first time, but omitted in the following year’s report, which has largely gone undetected is the following: The U.S. Government maintains indirect contact with the Liberation Tigers of Tamil Eelam (LTTE), but recognizes that the LTTE is on the U.S. Government’s Foreign Terrorist Organization (FTO) list."

The following year’s report to the US Congress Supporting Human Rights and Democracy: The U.S. Record 2002-2003 stated "The Government’s arbitrary arrest of citizens under the Prevention of Terrorism Act has been a serious human rights problem. Although the PTA is no longer used to detain new suspects, 65 Tamils remain in jail on PTA charges. The United States funds local organizations that work to insure that those who remain in detention under the PTA have access to legal services."

One could comprehend how much the United States was concerned about the use of the PTA, the application of its provisions which the official U.S. government documents described as the violation of human rights of a particular ethnic group in Sri Lanka singled out by the U.S. as the Tamil minority.

The above report admits that the U.S. Government even funded local organizations to see that the detainees, all of whom are ethnic minority Tamils, have access to legal remedies.

This scenario was strongly imbedded in the mind of American ambassador Robert O. Blake when he told the state TV interviewer that he would not prescribe USA Patriot Act type laws as "civil liberties, frankly, are already under strain here."

With that in mind, it is in the best interest of the Rajapaksa administration to implement the PTA with caution not giving political ammunition to the separatist Tigers to re-emerge as the ‘savior’ of the Tamil people and re-establish itself as the ‘sole representative of the Tamil people’ while giving no excuses for Tamil Tiger professionals in the United States to go before the most liberal/far left Democratic Congress that will be inaugurated in January 2007 to scrutinize and put the Government of Sri Lanka, which is fighting a battle to safeguard the territorial integrity and sovereignty, on the dock on the issue of human rights.

The Asian Tribune, in these columns, early November described how the new Democratic-controlled U.S. Congress whose vital committees such as foreign relations, intelligence and armed services controlled by far left liberals would look at the ‘national question’ in Sri Lanka, especially the rights of the Tamil minority, quite different to that of the neo-conservative Republicans who have proved during these six years of Bush administration that national security superseded the protection of civil liberties.

Ambassador Blake strategically and diplomatically escaped the trap laid for him by the interviewer to endorse the re-introduction of the PTA knowing full well the composition of the new Democratic-controlled Senate and the House and their committees that will make Bush a lame-duck president. But he gave some important signals to his host country administration.

- Asian Tribune -

http://www.asiantribune.com/index.php?q=node/3573

Sri Lanka opposition raises money laundering issue in parliament

December 08, 2006

Sri Lanka's main opposition party has said the government should investigate suspected money laundering transactions in the Colombo Stock Exchange, when the vote on the finance ministry's budget was taken up in parliament this week.

UNP Parliamentarian Bandula Gunawardene, a former deputy finance minister said Sri Lanka is gaining a reputation as a place for money laundering with investors becoming concerned, after questions were raised at an investment forum in Singapore last month.

Concerns have also been raised in the media in Sri Lanka about several suspected financial transactions, on the Colombo Stock Exchange.

The alleged deals, bear the classic hallmarks of a second phase of money laundering transaction known as 'layering', in which at least two foreign commercial banks are said to be involved.

They also say there could be another case where co-mingling of assets is taking place, though authorities are yet to take action.

Gunawardene says action should be taken investigate suspect transactions, by the Financial Intelligence Unit, which was especially set up to counter money laundering.

He is one of a group of opposition parliamentarians who have asked for a select committee to probe the appointment of Central Bank Governor Nivard Cabraal over his alleged links to GoldQuest.

Gunawardene speaking in parliament said when N M Perera had charged from the opposition that Dudley Senanayake was helping the business interests of Robert Senanayake - who is current UNP Chairman Rukaman Senanayake's father - an all-party select committee had been immediately appointed.

The Committee had found him innocent and N M Perera had later apologised. Gunawardene said those were the rich traditions of the parliament in Sri Lanka in bygone days.

Gunawardene asked why the government was reluctant to appoint a select committee, so that Governor Nivard Cabraal could be given a chance to clear his name if he was innocent.

A scandal erupted in the country after a special investigation unit that was instrumental in the arrest of several GoldQuest activists under Sri Lanka's anti-pyramiding, was suddenly disbanded by the Central Bank after Cabraal became its governor.

The Financial Intelligence Unit also functions inside the Central Bank.

Gunawardene says the government should also reveal what progress has been made in the investigations against pyramid schemes which were preying on youth in outstation areas.

http://www.lankabusinessonline.com/fullstory.php?newsID=460614093&no_view=1&SEARCH_TERM=2

Money laundering and regulatory failure in Sri Lanka queried at Singapore investment show

Nov 23, 2006

Foreign investors in Singapore who attended a road show by the Colombo Stock Exchange have raised questions about Sri Lanka’s growing infamy as a money laundering hub, and the inability of authorities to counter such activities, participants said.

One foreign investor asked the head table what action the authorities planned to take against recent share acquisitions in Sri Lanka by companies with questionable backgrounds.

Sri Lankan officials had replied that the country has signed international conventions against money laundering and a Financial Intelligence Unit had been set up, a participant said.

Sri Lanka’s Central Bank Governor Nivard Cabraal, Colombo Stock Exchange Chairman Nihal Fonseka, representatives from blue chip investment firms such as Dialog Telecom, John Keells Holdings and Sri Lanka Telecom as well as stock brokering firms participated in the investment conference in Singapore.

Critics have charged that Sri Lanka is becoming a favourite target of companies engaged in international financial frauds and other questionable activities.

Sri Lanka’s Central Bank is also currently surrounded in controversy after a scandal erupted over the sudden closure of an investigation unit, that was probing the activities of Goldquest in Sri Lanka, under newly enacted anti-pyramiding legislation.

The Colombo Stock Exchange is also in hot water after it failed to query why John Keells Holding shares suddenly shot up last week, when companies connected to Goldquest bought shares, though it is quick to query unusual price movements in other instances.

Meanwhile foreign investors had also privately raised questions from representatives of listed firms and brokers about regulatory failure in Sri Lanka’s financial markets at the Singapore show.

"Privately we were asked many questions after the main session ended," one representative of a listed company said.

"Naturally long-term genuine investors are concerned whether a company they invest could suddenly be taken over by criminals and looted and whether their money is safe."

Another participant said, he was asked more questions about dirty money entering Sri Lanka and regulatory failure, than terrorism.

The purchase of John Keells Holdings by companies related to Goldquest and Questnet has raised a storm in Sri Lanka because the blue chip owns a commercial bank, and has interests in vital areas of the economy such as container terminals.

Sri Lanka’s influential Sunday Island newspaper ran a front page lead story headlined 'Ogre behind stock market boom?' asking why there was no action against pyramid related firms buying into the leading listed companies.

"These suspect companies have been buying heavily, particularly in to JKH, where their holding is now near 5 percent, spectacularly pushing up the share price and provoking questions that pyramid related entities are buying into the parent of a bank," the newspaper said.

Recently a Ponzi scam run by Indian nationals collapsed, leaving hundreds of people penniless.

Analysts say Sri Lanka's lax regulations and corruption that is blocking their implementation is making the country easy prey to international racketeers.

Two foreign banks have so far been involved in channeling money from questionable sources into Sri Lanka's equity markets on the guise that they 'knew' their customer, despite such companies openly promoting illegal activities, sources said.

Analysts say Sri Lanka should now look at confiscating assets of known scam operators to pay off poor people who lost money, using the provisions of the anti-money laundering legislation.

Sri Lanka has also enacted anti-pyramiding legislation, under the direction of Treasury Secretary P B Jayasundera, when many Sri Lankans were left penniless after joining two referral fraud schemes, involving diamonds and gold coins.