VZCZCXRO7077 PP RUEHAG RUEHROV DE RUEHDM #0251/01 1051417 ZNY SSSSS ZZH P 141417Z APR 08 FM AMEMBASSY DAMASCUS TO RUEHC/SECSTATE WASHDC PRIORITY 4849 INFO RUEHXK/ARAB ISRAELI COLLECTIVE PRIORITY RUCNMEM/EU MEMBER STATES COLLECTIVE PRIORITY RUEHAK/AMEMBASSY ANKARA PRIORITY 5535 RUEHGB/AMEMBASSY BAGHDAD PRIORITY 0846 RUEKJCS/CJCS WASHDC PRIORITY RUCNDT/USMISSION USUN NEW YORK PRIORITY 0378 RUEAIIA/CIA WASHDC PRIORITY RHEFDIA/DIA WASHDC PRIORITY RHEHNSC/NSC WASHDC PRIORITY RHMFISS/HQ USEUCOM VAIHINGEN GE PRIORITY RHMFISS/HQ USCENTCOM MACDILL AFB FL PRIORITY RHEHAAA/WHITE HOUSE WASHDC PRIORITY S E C R E T SECTION 01 OF 03 DAMASCUS 000251 SIPDIS SIPDIS PARIS FOR JORDAN; LONDON FOR TSOU E.O. 12958: DECL: 04/13/2018 TAGS: PREL PGOV SY IZ SUBJECT: PREMATURE RUMORS OF ASIF SHAWKAT'S DEMISE REF: DAMASCUS 142 Classified By: CDA Michael Corbin, per 1.4 b,d. ¶1. (S) Summary: Widespread reports that Syrian Military Intelligence Chief Asif Shawkat is under house arrest and that Shawkat's wife (and Bashar Asad's sister) Bushra al-Asad is trying to flee the country likely reflect Bashar's successful moves to limit Shawkat's influence. While our sources suspect both stories are untrue and blame the external opposition for stirring the rumor mill to weaken Bashar, Shawkat's star definitely appears to be on the wane. End Summary ------------------------------- The Rumor Mill Working Overtime ------------------------------- ¶2. (SBU) Many Embassy contacts point to a report published by opposition website "Free Syria" as the original source of a number of news stories reporting Shawkat's house arrest. Sources here also contend that former Syrian VP (and now leader of the expat opposition group National Salvation Front) Abdel Halim Khaddam has attempted to weaken Bashar by repeating this rumor during recent anti-SARG interviews on SkyTV and Lebanese TV station al Moustaqbal in which he alleged Shawkat's house arrest and predicted Shawkat would suffer the same fate as now deceased head of Syrian intelligence operations in Lebanon, Ghazi Kanaan. ¶3. (SBU) Opposition website "al Haqiqa" published an April 6 story reporting that President Asad would replace Shawkat with SMI deputy Ali Yunis, a story similar to a "Debka" website report on Bashar's decision to fire Shawkat. Saudi daily "Sharq al Awsaat" reported Shawkat's house arrest; according to this version, Shawkat overstepped his authority in negotiating (via the Turks) with the USG about withdrawing Syria's support for Hizballah in exchange for agreement that the International Tribunal would not indict senior Syrian officials. Another version reported by the French-based opposition website "Ihraar Suriya" (the Free People of Syria) alleged that Shawkat had been implicated in the assassination plot against Hizballah leader Imad Mugniyah and that Hizballah and Iran were demanding his prosecution. ¶4. (C) Another rumor circulating in diplomatic circles (perhaps reflecting wishful thinking) is that Bashar has decided to turn Shawkat over to the International Tribunal for the murder for former Lebanese PM Rafiq Hariri in exchange for immunity. ----------------------------------- Bushra al-Asad to Flee the Country? ----------------------------------- ¶5. (C) Different stories regarding Shawkat's arrest also allege that his wife (and Bashar older sister) has or is attempting to leave the country and seek political asylum in possibly France or a Gulf country such as the UAE. The Kuwaiti daily "al-Siyasiya," for example, reported that Shawkat allegedly told his wife, Busra, to leave Syria with the couple's children, and she had applied for asylum in France (later denied by the French government, according to an April 13 story in "al Hayat.") According to a few contacts here, however, Bushra remains in Syria and her children are still attending school. A French Embassy contact told us that Bushra had been to Paris earlier in the year on a routine shopping excursion but there was no truth to stories that she had sought political asylum. ---------------------- Rumors Discounted Here ---------------------- ¶6. (SBU) In what many are viewing as a SARG response to the growing wave of rumors, an April 10 Syrian TV evening newscast showed footage of Shawkat attending a military academy graduation ceremony. The footage highlighted Shawkat wearing his military uniform and appearing with Minister of Defense Hasan Turkumani, who delivered the key note address. Meanwhile, pro-government Syrian website "Shafaf al-Sham" ran a story describing Shawkat as the "most powerful man in Syria" and reporting government plans to appoint Shawkat as Vice President for National Security Affairs. (Note: This position was a job briefly held by Bashar's paternal uncle Rifa't al-Asad before being exiled by the late Hafez al Asad.) ¶7. (S) Most of our contacts heavily discount reports of Shawkat's dismissal and house arrest. Well connected As-Safir correspondent Ziad Haydar called the reports "rubbish." Ihsan Sanker, a longtime Embassy contact who claims occassional access to Asad family members, reported April 10 seeing Shawkat at the funeral of a mutual friend a week earlier. According to Sanker, mutual acquaintances say they have seen Shawkat "regularly" over the last month. ----------------------------- Shawkat's Star on the Decline? ----------------------------- ¶8. (S) Describing Shawkat as "dejected and withdrawn," Sanker said Shawkat was "not even trying to hide" his unhappiness over his continuing loss of influence. The assassination of Hizballah luminary Imad Mugniyeh led to a series of accusations between SMI and GID, with the outcome coming out in GID's favor, Sanker reported. Additionally, Sanker said he had heard Shawkat's portfolio had been pared down to military issues, while Bashar's cousin Hafez Makhluf had all but taken over the national security portfolio. As-Safir correspondent Haydar reported he had heard the same thing, saying Bashar had recently further marginalized Shawkat's national security role. ¶9. (S) Orient Center Director and MFA Advisor Samir al-Taki told us recently that Shawkat and GID chief Ali Mamluk had exchanged mutual recriminations of blame and negligence in the wake of the Mugniyeh assassination (reftel). In an attempt to discredit GID, Shawkat ordered SMI to question a number of Syrians with ties to France and the U.S. (including al-Taki) under possible suspicion of involvement in the Mugniyeh affair. In the meantime, al-Taqi added, the GID had assumed primary responsibility for investigating the Mugniyeh killing, under the overall direction of Bashar's cousin, Hafez Makhluf, a prominent GID officer. Against the backdrop of these recent events, an ongoing reorganization of security organizations has made it difficult to determine who was up and who was down, al-Taqi explained. Separate reporting and diplomatic circles point to Mamluk's rise and Shawkat's relative retreat. But Al-Taqi cast doubt on reports of Shawkat's removal, saying "we've heard such reports before," only to see Shawkat maintain his position as a key insider. ------------------------- Shawkat in the Dog House? ------------------------- ¶10. (S) A UK-Syrian business contact with low level regime ties told us April 13 that Shawkat's problems with Bashar had come to head before the Arab League Summit. According to this source, SMI arrested a Saudi national suspected of involvement in the Mugniyeh assassination. This Saudi died in SMI custody, complicating Bashar's already strained relations with the Saudi royal family. A variant of this rumor which has appeared in the press was that the deceased Saudi was a diplomat working in the Saudi Embassy. Our contact discounted this rumor because "not even Shawkat would be stupid enough" to apprehend someone with diplomatic immunity. ¶11. (S) Comment: It seems highly unlikely that Bashar would arrest Shawkat unless he perceived a direct challenge to his authority, especially at a time when Syrians are openly talking about the possibility of war with Israel and worsening economic conditions that require greater regime cohesion. Moreover, we strongly doubt Bashar feels pressured enough on Lebanon to be preparing to turn over Shawkat to the Tribunal. Rather, we believe Bashar's continuing efforts to erode Shawkat's influence reflect his perception of Shawkat as a potential threat that must be managed. Separately, we assess that Bashar is most comfortable with Bushra here in Syria under his thumb and that he would not cause her to flee. We also believe that unless family matters worsen, Bushra prefers to reside in Syria, particularly given her desire to stay close to her elderly mother. CORBIN
Tag: michael corbin
SECRET: HIZBALLAH’S IMAD MUGNIYAH KILLED BY CAR BOMB
VZCZCXRO7049 PP RUEHAG RUEHROV DE RUEHDM #0107 0441447 ZNY SSSSS ZZH P 131447Z FEB 08 FM AMEMBASSY DAMASCUS TO RUEHC/SECSTATE WASHDC PRIORITY 4627 INFO RUEHXK/ARAB ISRAELI COLLECTIVE PRIORITY RUCNMEM/EU MEMBER STATES COLLECTIVE PRIORITY RUEAIIA/CIA WASHDC PRIORITY RUEPGBA/CDR USEUCOM INTEL VAIHINGEN GE PRIORITY RHEFDIA/DIA WASHDC PRIORITY RHMFISS/HQ USCENTCOM MACDILL AFB FL PRIORITY RHEHNSC/NSC WASHDC PRIORITY RUEKJCS/SECDEF WASHDC PRIORITY S E C R E T DAMASCUS 000107 SIPDIS SIPDIS E.O. 12958: DECL: 02/12/2018 TAGS: PGOV PTER SY LE SUBJECT: HIZBALLAH'S IMAD MUGNIYAH KILLED BY CAR BOMB IN DAMASCUS Classified By: CDA Michael Corbin, reasons 1.5 b and d. ¶1. (SBU) Syria's tightly controlled press remained silent on reports of Imad Mugniyah's death in a car bomb that exploded near Syrian Military Intelligence (SMI) headquarters in the neighborhood of Kafr Sousa at approximately 10:00 pm local February 12. According to contacts who were on the scene, SMI secured and cleared the area and kept other police services away. Tow trucks removed several vehicles within 45 minutes after the explosion which jarred surrounding buildings and could be felt at the American Ambassador's residence three miles away. Syrian officials reported the blast had been the result of a butane gas leak and that one unidentified person (later two) had been killed. ¶2. (C) Media and other contacts reported mid-morning February 13 that unknown assailants had launched a car bomb attack against notorious Hizballah military operative Imad Mugniyah. The story broke simultaneously on wire services and Arab satellite television stations al Jazeera, al Arabyia, and al Manar. Western press was also reporting that the second victim was Hizballah MP al Hajj Hussein, although Hizballah denied this. As of COB local, Syrian authorities had yet to provide any further comment on the incident. (A Fox News affiliate told us MFA officials seemed "shocked" by reports of Mugniyah's death but offered no comment.) ¶3. (C) The most frequent theory suggested by media and diplomatic contacts was that Israel conducted the attack to embarrass Syria on the eve of a previously scheduled visit by Iranian FM Manuchehr Mottaki. Going to the other extreme, others were unwilling to rule out that Hizballah itself had conducted the assassination to neutralize Mugniyah's challenge to Hizballah Secretary General Hassan Nasrallah. One contact even suggested that Syria could have undertaken the operation as a sign of its desire to engage Israel and the West. ¶4. (S) Saudi XXXXXXXXXXXX (protect) told us Mugniyah's presence in Damascus might have been related to a possible February 13 meeting in Damascus among Lebanese March 8 MPs with SARG officials. He also noted that SMI Director Assaf Shawkat's offices were close to where the explosion occurred, and Mugniyah could have been going to or coming from the meeting. British and Egyptian Embassy sources suggested Iranian FM Mottaki planned to meet with Hizballah and March 8 representatives during his February 13-14 visit to Damascus as a counter to March 14's planned public demonstration to mark the third anniversary of the February 14 assassination of former Lebanese PM Rafiq Hariri. ¶5. (C) Comment: This apparent targeted assassination of one of Hizballah's most notorious operatives coincides with a busy week of official visits meant to refute suggestions that Syria's Lebanon policy is resulting in a new period of Western and Arab diplomatic isolation. Syria's ongoing silence regarding the attack is a characteristic regime response, most recently observed (and still in effect) after Israel's September 6 air strike near Deir az-Zur. This silence likely reflects a deep sense of regime embarrassment from the acknowledged assassination of a wanted-terrorist whose presence in Syria it denied for years. The event also impacts Syrian-Iranian-Hizballah cooperation on the eve of FM Mottaki's visit likely meant to bolster Syria's position in the face of escalating March 14 rhetoric and growing Western impatience with Syria's Lebanon policy. CORBIN
SECRET: MAXIMIZING THE IMPACT OF RAMI’S DESIGNATION
VZCZCXRO5973 OO RUEHDE DE RUEHDM #0070/01 0311027 ZNY SSSSS ZZH O 311027Z JAN 08 FM AMEMBASSY DAMASCUS TO RUEHC/SECSTATE WASHDC IMMEDIATE 4583 INFO RUEHAD/AMEMBASSY ABU DHABI IMMEDIATE 1372 RUEHAM/AMEMBASSY AMMAN IMMEDIATE 7207 RUEHAK/AMEMBASSY ANKARA IMMEDIATE 5447 RUEHTH/AMEMBASSY ATHENS IMMEDIATE 0324 RUEHGB/AMEMBASSY BAGHDAD IMMEDIATE 0758 RUEHLB/AMEMBASSY BEIRUT IMMEDIATE 4839 RUEHKU/AMEMBASSY KUWAIT IMMEDIATE 1295 RUEHNC/AMEMBASSY NICOSIA IMMEDIATE 7624 RUEHRH/AMEMBASSY RIYADH IMMEDIATE 7932 RUEHTV/AMEMBASSY TEL AVIV IMMEDIATE 2081 RUEHVI/AMEMBASSY VIENNA IMMEDIATE 0147 RUEHDE/AMCONSUL DUBAI IMMEDIATE 0161 RUEAIIA/CIA WASHDC IMMEDIATE RHEFDIA/DIA WASHDC IMMEDIATE RHEHNSC/NSC WASHDC IMMEDIATE RUEATRS/DEPT OF TREASURY WASHDC IMMEDIATE RUCPDOC/DEPT OF COMMERCE WASHDC IMMEDIATE S E C R E T SECTION 01 OF 04 DAMASCUS 000070 SIPDIS SIPDIS STATE FOR NEA/ELA, EEB/TFS; TREASURY FOR U/S LEVEY; NSC FOR ABRAMS/SINGH E.O. 12958: DECL: 01/31/2018 TAGS: ECON EINV EPET ETTC PGOV PINR KCOR SY SUBJECT: MAXIMIZING THE IMPACT OF RAMI'S DESIGNATION REF: A. DAMASCUS 54 ¶B. 05 DAMASCUS 2364 ¶C. 06 DAMASCUS 03 Classified By: Charge d'Affaires Michael Corbin for reasons 1.4(b,d) ------- SUMMARY ------- ¶1. (S/NF) As Washington moves towards designating Rami Makhlouf, Embassy Damascus recommends that the Department's roll-out strategy focus on linking his corrupt activities to consequences suffered by the Syrian people (see para 11). In some of the largest economic sectors -- electricity, petroleum, and telecommunications -- Makhlouf has used government instruments to squeeze out legitimate businessmen, receive lucrative public contracts, establish cash cows and then milk them with impunity from oversight or competition. Significantly, several of his ventures exploit weaknesses in the Syrian economy and undermine reform efforts while increasing the burden on Syria's lower classes. Embassy contacts report that Makhlouf is anticipating his eventual designation, and that he has taken steps to lower his profile and mitigate risk to his personal fortune. End summary. ------------------ MAKING THE CASE... ------------------ ¶2. (C) In one well-known example, Makhlouf used his regime ties to muscle-out the local agent for Iberdrola, just before the Spanish company was awarded a 430 million-euro contract to build a new power plant. Having previously obtained exclusive rights to represent Siemens, Rami profited again when additional power infrastructure projects were awarded to the German company. Currently, both the Iberdrola (Iberinco) and Siemens projects are behind schedule and over-budget. Over the same period, the Syrian public suffered from rolling blackouts and increased electrical bills. During last summer's August heatwave, poorer neighborhoods went without power up to ten hours per day while Prime Minister Utri blamed Syria's electrical woes on "international pressure" rather than insufficient SARG investment in infrastructure. Blackouts have recently returned to Syria and Rami's avarice (reportedly demanding a USD 30 million "commission" in Iberdrola's case) is a key contributing factor. ¶3. (U) Rami is suspected of delaying the SARG's anticipated licensing of a third GSM service provider in Syria until he closes a deal to sell SyriaTel, which reportedly earned USD 692 million in 2007 alone. Since GSM service was first introduced in 2000, Syrians have been forced to choose between two providers, Makhlouf's SyriaTel and Areeba (now MTN), which was reportedly owned by First Lady Asma al-Akhras' family. Syrians widely resent the duopoly's ability to set prices for the entire country. With market forces unable to compete, regime corruption elevated the price of basic GSM service on which the average Syrian relies as his primary means of communication. (There are six million mobile subscribers to roughly three million land-line connections.) ¶4. (C) At a time when Syria's petroleum exports are contracting and the Syrian people are increasingly suffering from fuel shortages, Rami's presence in the petroleum sector is exacerbating the problem. The French company Total proposed a venture that would have brought additional Syrian gas reserves on-line in time to avert recent shortages, but the deal has inexplicably floundered facing SARG bureaucratic inaction. Similarly, a Shell offer to upgrade and increase capacity of Syrian refineries remains mired in SARG bureaucracy at a time of acute shortages in refined product. Interestingly, the only petroleum project currently proceeding at full-speed in Syria is the Gulfsands (35 percent) "strategic partnership" with the Rami-led Cham Holding Company (65 percent) to develop the recent oil and gas discovery in the Khurbet East region (Northeastern Syria). According to a Gulfsands' statement, the joint venture soon expects to bring 10,000 bpd of new oil production on-line. ¶5. (U) In a particularly brazen venture, Makhlouf also seems intent on profiting from the impact of US sanctions on Syrian Arab Airlines. Rami's Cham Holding Company (40 percent) has joined with Syrian Air (25 percent) and the Kuwaiti company Al Aqeelah (35 percent) to create the first "private airline" in Syria, dubbed the Cham Pearl. The Kuwaiti company's subsidiary, Aqeeq Aviation Holding, is apparently exploring ways to circumvent US sanctions and provide commercial aircraft. Once operational, Cham Pearl intends to take over Syrian Air's most profitable routes of three hours or less -- 75 percent of Syrian Air's business -- from Damascus to major regional airports, leaving Syrian Air with the less profitable long-haul routes. (See "Syria: Opening Skies," Oxford Business Group, January 29, 2008) ¶6. (U) Makhlouf remains unabashed about employing SARG muscle when necessary. In one oft-repeated example on the Damascus street in 2007, a Syrian businessman purchased a prime piece of real estate along the Mezzeh autostrade and received a permit from the city to construct a large apartment building. As the project progressed, the SARG security services informed the building's owner that he could not complete his project as it would allow future occupants to have direct line-of-sight to the Damascus airport. Rami's agents then visited the distraught owner and offered to buy the unfinished building for a fraction of the property's actual value. Rebuffing Makhlouf's initial offer, the owner sought recourse in the local courts for weeks to no avail. In late 2007, Cham Holding announced that it had acquired the property and would be developing a five-star Marriott hotel on the site at a cost of USD 70 million. ¶7. (C) Note: A hospitality-industry contact told Econoff that Rami and Nabil Kuzbari (ref A) had traveled to the US and met with senior Marriott executives in December to present a potential business proposal and discuss design options for the site. According to the contact, the Syrians left the US believing they had closed the deal and upon returning, prematurely leaked their success to the local media. In late December, Marriott reportedly informed Cham Holding that it was no longer interested in the proposal due to "political reasons." End note. ¶8. (U) Although difficult to prove, various internet-based newsletters claim that Makhlouf is the political patron of many high-ranking public SARG officials, including Minister of Construction Hamud al-Hussein, Minister of Petroleum Sufian Allaw, Minister of Electricity Ahmad Khalid al-Ali, Central Bank Governor Adib Mayaleh and former Minister of Telecommunications Amro Salem. As officials with these portfolios would be in position to wield substantial influence over industry regulation and lucrative tenders, it is doubtful that Rami would have enjoyed such uncanny business successes without government collusion. ------------------------ DIFFUSING RESPONSIBILITY ------------------------ ¶9. (U) Since returning from his brief exile in Dubai (ref B), Rami has taken several measures to try to both lower his profile and insulate his personal fortune. In 2006, Makhlouf founded the Al Mashrek Fund, a holding company with a reported capitalization of SYP 4 billion (USD 80 million), including SYP 1 billion (USD 20 million) in cash deposited with Banque Bemo Saudi Fransi. Later that year, Makhlouf and 69 prominent Syrian businessmen formed the Cham Holding Company with an initial capitalization of USD 200 million, now estimated to be worth USD 350 million. Representing Makhlouf, the Al Mashrek Fund is the majority shareholder in Cham Holding, which currently has 65 partners and a ten-member board of directors. By mid-2007, Cham Holding was pursuing six "landmark" development projects valued at USD 1.3 billion, primarily in energy, transportation and real estate. (See The Syria Report, April 30 and Sept 12, 2007) ----------------------------------------- USING CUT-OUTS AND PRIVATE BANKING SECTOR ----------------------------------------- ¶10. (S/NF) In addition to his public financial activities, Makhlouf has undertaken several behind-the-scenes machinations to mitigate his financial risk. Possibly concerned by the vulnerability of UAE banks to US pressure -- or frustrated by Emirati laws limiting foreign investment to real estate and the stock market -- Rami reportedly brought a part of his fortune back into Syria in 2006. According to a well-informed contact, Rami befriended then-expatriate Syrian Morthada al-Dandashi in Dubai and hired him to manage many of Makhlouf's "parallel" financial activities in Syria. The contact said that Rami paid Dandashi's USD 2 million "ante" to become a partner in Cham Holding, and deposited significant sums under Dandashi's name in the Damascus branch of the Lebanese Byblos Bank -- where Dandashi subsequently became a partner. Syrian-Austrian citizen and Cham Holding director Nabil Kuzbari is also reported to have deposited money for Rami in Austrian banks. Finally, contacts say Makhlouf has also opened accounts under different names in Lebanon, Greece, Turkey, and possibly Cyprus -- where Post has learned that Rami once explored obtaining citizenship. ------------------------- SUGGESTED ROLL-OUT THEMES ------------------------- ¶11. (U) Post recommends the following themes for public statements regarding the designation of Rami Makhlouf: -- Electricity: Rami Makhlouf used his influence with the regime to gain lucrative contracts in the power sector. Yet, as the Syrian people continue to suffer from chronic power outages and higher electrical bills, Rami has already been paid for projects that are behind schedule and well over-budget. -- Petroleum: Although several Western petroleum companies are interested in helping Syria develop its gas and oil sector, the only new project to be proceeding without SARG impediment is Rami's. As a result, Syria has become a net importer of petroleum products. In the midst of an unusually severe winter, severe fuel shortages are forcing the Syrian public to wait in long lines for, and frequently go without, heating fuel for their homes. -- GSM service: Rami Makhlouf has made millions of dollars from his ownership of SyriaTel, one of only two GSM service providers in Syria. Currently, Rami is said to be blocking the licensing of a third GSM provider until he completes a deal to sell SyriaTel. Until free market forces are allowed to compete, Makhlouf will continue to subject the Syrian public to artificially elevated prices for basic telecommunications services. -- Aviation: The Syrian national air carrier, Syrian Arab Airlines (Syrian Air), has an aging fleet that is in need of replacement. Rather than addressing any of Syrian Air's needs, the Assad regime instead awarded Rami Makhlouf a license to operate a private airline that intends to assume the most profitable of Syrian Air's routes. -- Tourism/Hospitality: The Syrian people are known for their hospitality and entrepreneurial expertise. Unfortunately, legitimate Syrian businessmen hoping to invest in the emerging tourism sector have again been muscled-out by Rami Makhlouf and regime thugs who wish to monopolize every opening in the Syrian economy for their own profit, rather than share the country's potential with the hard-working Syrian people. ------- COMMENT ------- ¶12. (S/NF) Makhlouf's efforts to divest and diversify suggest that he is expecting eventual USG action against him, particularly since the November 2007 designation of his brother, Hafiz. Although his countermeasures will likely mitigate the impact of his designation, we believe that it will still send a strong signal to the regime and to his current and potential future business partners. Corruption is a theme that resonates here, as every Syrian has been a victim of it. Rami has long been Syria's poster-boy for corruption, so making the charge stick is not difficult. Citing examples that impact the daily lives of Syrians should help to amplify the designation's roll-out and ensure that it receives the widest possible coverage. HOLMSTROM
SECRET: TREASURY TEAM’S DAMASCUS CONSULTATIONS ON
VZCZCXRO6583 PP RUEHAG RUEHROV DE RUEHDM #0269/01 0741541 ZNY SSSSS ZZH P 151541Z MAR 07 FM AMEMBASSY DAMASCUS TO RUEHC/SECSTATE WASHDC PRIORITY 3157 INFO RUEHXK/ARAB ISRAELI COLLECTIVE PRIORITY RUCNMEM/EU MEMBER STATES COLLECTIVE PRIORITY RHEHAAA/WHITE HOUSE WASHDC PRIORITY RUEAIIA/CIA WASHDC PRIORITY RUEATRS/DEPT OF TREASURY WASHDC PRIORITY S E C R E T SECTION 01 OF 02 DAMASCUS 000269 SIPDIS SIPDIS NEA/ELA;TREASURY FOR LEBENSON/GLASER/SZUBIN; NSC FOR MARCHESE EO 12958 DECL: 03/06/2017 TAGS EFIN, ECON, ETTC, SY, SANC SUBJECT: TREASURY TEAM’S DAMASCUS CONSULTATIONS ON FINANCIAL SANCTIONS REF: A. DAMASCUS 0108 B. 05 DAMASCUS 6224 Classified By: Charge d’Affaires Michael Corbin, reasons 1.4 b/d ¶1. (S/NF) Summary: Treasury representatives recently visited Post to discuss options for using financial sanctions to apply pressure to the Syrian regime. We discussed: -- Treasury’s requirements for finalizing the pending designations of Mohammad Sulayman and Ali Mamluk, and Treasury’s information requirements for a public statement; -- Treasury’s need to maintain the legal thread between the classified designation packet and the public statement announcing the designation; -- Post’s support for designating Mohammad Nassif Kheirbek, SARG pointman for its relationship with Iran; -- How designating regime financiers like Rami and Mohammad Mahlouf could be problematic without a new Executive Order on corruption. End Summary. ¶2. (S/NF) PENDING DESIGNATIONS: Post understands the designations for Mohammad Sulieman, Syrian Special Presidential Advisor for Arms Procurement and Strategic Weapons and Ali Mamluk, Chief of the Syrian General Intelligence Directorate, are pending due to a lack of unclassified material necessary for Treasury’s public SIPDIS designation statement. In post’s estimate, Mohammad Sulayman is a relatively low-payoff target. His activities are not widely known, which will make it difficult to obtain unclassified information for a public statement and, SIPDIS likewise, make it unlikely that his designation would resonate inside Syria. Ali Mamluk, on the other hand, is more well-known within Syria, especially for involvement in his objectionable activities regarding Lebanon, and his suppressing Syrian civil society and the internal opposition. Therefore, Mamluk’s designation will likely have a larger impact with local and regional audiences if the public statement announcing his designation also discusses his oppression of Syrian society. ¶3. (S/NF) We understood from our visit with Treasury representatives that although we are limited to designating regime members under the existing Executive Orders, there is some flexibility in Treasury,s public statement announcing the designation. Post has advocated that no matter the legal basis of the designation, any public designation should focus on themes that resonate inside Syria: corruption, suppression of civil society, and denial of basic human rights (ref A). The need to maintain the “legal thread” between the designation packet and the public announcement could be challenging on cases like Mohamad Sulieman whose links to corruption are less clear. In cases like Ali Mamluk, however, the role of the organization he heads in suppressing internal dissent is publicly known in Syria and stating as much in our statement would resonate well here. ¶4. (S/NF) Post also supports moving forward with the designation packet on Mohammad Nasif Kheirbek, Syrian Deputy Vice-President for Security and lead Syrian liaison to Iran. Keirbek’s designation could play to a SARG vulnerability, in this case, the SARG’s relationship with Iran, which worries the Sunni majority. Designation of regime pillars involved with the SARG’s partnership with Iran could heighten Syrian and regional concerns about the SARG’s willingness to accomodate an expansionary Iranian agenda. ¶5. (S/NF) REGIEME FINANCIERS: We also discussed the possibility of targeting high-profile inner circle members and regime financiers like Rami Mahklouf (Asad’s first cousin) and Mohammad Makhlouf (Rami’s father) in the next phase of targeted financial sanctions. Based on our consultation with the Treasury representatives, it seemed apparent that without an Executive Order on corruption it would be difficult to compile enough information to designate this group under the current executive orders. The other option for pursuing this group would be to show how these individuals provided financial support to previously designated individuals such as Asif Shawkat. This course of action could prove highly problematic given the regime’s proficiency at obfuscating its financial transactions (ref B). DAMASCUS 00000269 002 OF 002 ¶6. (S) Comment. Post thanks Treasury for its team’s February 25-27 visit and welcomes any additional feedback that Washington agencies may have on our recommendations covered in ref A. Post continues to believe targeted financial sanctions are a tool appropriate for the Syrian setting but this tool requires further work to fully develop. ROEBUCK
Bernd Pulch 