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Viewing cable 05WELLINGTON160, NEW ZEALAND AIMS TO STRENGTHEN ITS TERRORIST
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Reference ID | Created | Released | Classification | Origin |
---|---|---|---|---|
05WELLINGTON160 | 2005-02-23 04:43 | 2011-04-28 00:00 | CONFIDENTIAL | Embassy Wellington |
This record is a partial extract of the original cable. The full text of the original cable is not available.
C O N F I D E N T I A L SECTION 01 OF 03 WELLINGTON 000160
SIPDIS
DEPARTMENT FOR EB/ESC/TFS, EAP/ANP AND S/CT
E.O. 12958: DECL: 02/22/2015
TAGS: KTFN EFIN PTER PREL NZ
SUBJECT: NEW ZEALAND AIMS TO STRENGTHEN ITS TERRORIST
FINANCE LAWS
Classified by: DCM David R. Burnett. Reasons: 1.4 (b) and
(d).
¶1. (U) Summary: The New Zealand government continues to
tighten provisions of an anti-terrorism law it enacted more
than a year after September 11, 2001, and that it amended in
¶2003. The government recently introduced legislation that
will delay the expiration date for New Zealand's designations
of terrorist organizations to 2007. The bill also proposes
extending the law's reach to cover intentional financing of
non-designated terrorist organizations. The changes are
aimed at keeping New Zealand in compliance with UN Security
Council Resolution 1373, as well as to follow recommendations
presented in a Financial Action Task Force review. More
changes are coming, with a government review of the
anti-terrorism law scheduled for completion by December 1,
¶2005.
¶2. (C) Meanwhile, the government is grappling with procedural
issues that often have delayed New Zealand's designation of
terrorist individuals and entities. Its law does not allow
for the automatic designation of terrorists as listed by the
United Nations. Nor has New Zealand yet designated as a
terrorist any individual or entity that was not already
UN-listed, largely because it lacks procedures for handling
classified information in its courts. Post continues to work
with New Zealand officials to determine whether the U.S.
government might help the New Zealand government as it works
to revamp its legislation and court procedures. End summary.
Changes in the law
------------------
3) (U) On February 10, Justice Minister Phil Goff introduced
in Parliament a second amendment to the Terrorism Suppression
Act 2002, the law that allows the government to designate
terrorists and terrorist organizations and to freeze their
assets. The act's drafters had assumed that some
designations might be short-lived, and so the law requires
that New Zealand's designations of terrorist organizations --
covering 318 organizations listed by the UN Security Council
-- expire in October unless renewed individually by the High
Court. The amendment extends the expiration date by two
years, to 2007, aiming to keep New Zealand in compliance with
UN Security Council Resolution 1373 and related resolutions.
The extension also accommodates an ongoing government review
of the Terrorism Suppression Act, which is expected to
recommend additional changes to the law when it is completed
by December 1, 2005. The government hopes to pass the
amendment by July, well before national elections that
probably will be held in September, as the resulting change
in government appointments could delay the bill's
implementation.
4) (C) The amendment also would extend the law's prohibitions
against financing terrorist acts and designated terrorist
entities to apply to the intentional financing of
non-designated terrorist organizations. To be illegal, the
funding would not necessarily have to be used to support a
specific terrorist act. Any support of the organization
would be banned. This change addresses a shortcoming in New
Zealand's law identified in a review by the OECD's Financial
Action Task Force on Money Laundering (FATF). Gabrielle Rush
(strictly protect), an adviser in the Ministry of Foreign
Affairs and Trade's legal division, said the government
believes that successful prosecutions under the provision
would be unlikely, given the difficulty of proving a person
"knowingly" financed a terrorist group. Nonetheless, the
government wants to comply with FATF's Eight Special
Recommendations on terrorist financing and its revised 40
Recommendations. New Zealand was among the first countries
to undergo a FATF peer review of its terrorist financing and
money-laundering laws. Recommendations by the review, which
was completed in late 2003, have not yet been published,
although the government received the task force's draft
report in mid-2004.
5) (U) On February 16, Minister Goff announced additional
laws to counter terrorist financing and money laundering, all
intended to satisfy FATF's recommendations. The laws would
set up a monitoring regime to ensure compliance by financial
and other institutions with anti-money laundering and
terrorist finance requirements. Currency changers and funds
remitters -- currently unregulated -- would be required to
register and would be subject to the same reporting
requirements as banks. Financial institutions would have to
obtain, verify and retain information about the identity of
people sending wire transfers. Minister Goff explained in a
statement, "New Zealand's largely deregulated financial
system results in potential loopholes in our system that
require closing in order to meet strict international
requirements."
Problems in the law
-------------------
¶6. (C) New Zealand has largely complied with UNSCR 1373. It
has not yet identified any terrorist assets in the country.
But the government's process for designating UN-listed
terrorist entities can involve delays. Since enactment of
the Terrorism Suppression Act, the New Zealand Police have
initiated the designation process, determining whether
sufficient criteria exists -- even for UN-listed entities.
The process is a slow one: The police draft applications for
designation, circulate them among relevant government offices
and send them to the Prime Minister for her final approval.
Although the Prime Minister has approved all designations
presented by police, weeks can pass between designation of an
individual or entity by the United Nations and designation by
New Zealand. Previously, a stopgap measure approved by
Cabinet on November 26, 2001, had provided for the automatic
designation of UN-listed entities in New Zealand. A year
later, it was replaced with the Terrorism Suppression Act,
which designated in New Zealand all entities listed by the
United Nations by October 18, 2002. (Those designations will
expire in October under the current law.) Since then,
designations have been made through the process shepherded by
police.
¶7. (C) Even for UN-listed individuals and entities, police
must build a case for their designation in New Zealand that
meets the Terrorism Suppression Act's requirements, according
to Bill Peoples (strictly protect), crime policy and projects
officer for the New Zealand Police. That means the police
case must provide the Prime Minister with "reasonable
grounds" for believing that an individual or entity knowingly
carried out or participated in a terrorist act, before she
can designate it. Peoples said that in some cases the
government's legal counsel, Crown Law, has questioned whether
the United Nations had sufficient evidence to make a
designation.
¶8. (C) If the designations are sponsored by the United
States, providing "reasonable grounds" can be relatively
easy, Peoples said. The U.S. government supplies a statement
of case when it pre-notifies the New Zealand government
before submitting names for designation to the UN 1267
Sanctions Committee. However, some nations do not authorize
the United Nations to identify them or to release their
statements of case when they submit names for designation.
In such instances, the police are forced to independently
build a case for designations.
¶9. (C) Flaws in the law stem from how it was drafted, said
Rush of the Ministry of Foreign Affairs and Trade (MFAT).
When the law was first introduced, a number of legislators
immediately objected that the bill would unfairly impinge on
civil liberties. In the end, it took a year to be reviewed
and passed, and provisions had been watered down. As Rush
explained, some New Zealanders fear the law could be applied
to someone like Nelson Mandela, who was labeled a terrorist
by his government but who many consider a "freedom fighter."
While New Zealand's designations under the Terrorism
Suppression Act have not been challenged in court and no New
Zealander has been designated, Rush said the government
worries about how it would defend designation of a New
Zealander based on the UN list, if information behind the
listing were not available. New Zealand officials expect
their planned, future revisions will eliminate the law's
weaknesses, as now there are clearer international best
practices in place.
¶10. (C) Peoples and Rush said the government also is
exceedingly cautious because of the case of Ahmed Zaoui, a
former member of Algeria's parliament who sought refugee
status on arrival in New Zealand in December 2002. In a
statement on entities designated as terrorists by the Prime
Minister in September 2004, Zaoui's political party -- the
Islamic Salvation Front, or FIS -- was linked to an
individual who has ties to al Qaida. At the time, the
government was under pressure by Zaoui's supporters because
it continued to keep him in custody, largely on the basis of
classified information. While the UN designation did not
link the FIS to al Qaida, the New Zealand police had based
the statement on open sources. But, that information was
subject to different interpretations, and the police
ultimately withdrew the statement and apologized. Peoples
said the designation has been the only problematic one
presented to the Prime Minister for approval. The Zaoui case
is still pending, and New Zealand officials are reviewing
possible legislative changes that would eliminate conflicts
between the country's immigration and refugee laws that the
case has exposed. In the meantime, publicity surrounding the
case has increased the Prime Minister's cautiousness -- and
that of Crown Law and other government agencies -- in
considering police proposals for designations.
¶11. (C) In addition, the New Zealand government has not yet
designated individuals and entities as terrorists that are
not already designated by the UN, because the courts lack
procedures for the introduction of classified information in
trials, Rush said. Crown Law and the judiciary are working
to establish such procedures. Until then, the government is
reluctant to designate entities not on the UN list because of
the fear of legal challenges. In the meantime, Peoples said
he is preparing a proposal to designate Hezbollah based only
on open-source documents. He is uncertain whether such a
case would provide "reasonable grounds" for a designation.
¶12. (C) The police are preparing a list of issues they want
addressed by the Foreign Affairs, Defense and Trade Select
Committee, which is reviewing the Terrorism Suppression Act.
Those include the lack of an automatic designation of
UN-listed entities. Other government departments also have
been asked to comment on the law. Rush said the government
will be studying the designation process in other countries
and will consider two tracks for designations, one for
UN-listed entities, possibly incorporating a degree of
automaticity, and another for entities not designated by the
United Nations.
¶13. (C) Comment: Rush and Peoples noted that more open-source
information would be helpful in obtaining designations. Post
will continue to work with EB/ESC/TFS and other relevant
offices to determine whether additional U.S. government
information could be provided to New Zealand, at least until
it revises its law and court procedures.
Swindells