Category Archives: Human Rights Violations United Nations

Time to Place a Terror Status on Drug Cartels

Posted on by

President Trump has long pledged to sign off on declaring drug cartels as terror organizations going back to at least March of 2019.

Mexican security forces on Sunday killed seven more members of a presumed cartel assault force that rolled into a town near the Texas border and staged an hour-long attack, officials said, putting the overall death toll at 20.

The Coahuila state government said in a statement that lawmen aided by helicopters were still chasing remnants of the force that arrived in a convoy of pickup trucks and attacked the city hall of Villa Union on Saturday.

The reason for the military-style attack remained unclear. Cartels have been contending for control of smuggling routes in northern Mexico, but there was no immediate evidence that a rival cartel had been targeted in Villa Union.

Earlier Sunday, the state government had issued a statement saying seven attackers were killed Sunday in addition to seven who died Saturday. It had said three other bodies had not been identified, but its later statement lowered the total deaths to 20.

Death toll put at 20 for Mexico cartel attack near US ...

The governor said the armed group — at least some in military style garb — stormed the town of 3,000 residents in a convoy of trucks, attacking local government offices and prompting state and federal forces to intervene. Bullet-riddled trucks left abandoned in the streets were marked C.D.N. — Spanish initials of the Cartel of the Northeast gang.

Given the recent deaths in two attacks, momentum is building and what is taking so long? Frankly, it comes down to the trade deal(s) between the United States and Mexico which has been approved by Mexico, Canada and the Unites States but not ratified yet by our own Congress.

For some context on how easy it is to apply sanctions regarding ‘countering narcotics trafficking’ there is a law titled the King Pin Act. Recently updated this past June, The Foreign Narcotics King Pin Designation Act has 32 pages, two columns of named individuals or organizations.

In part of this law for reference includes:

THE KINGPIN ACT

On December 3, 1999, the President signed into law the Kingpin Act (21 U.S.C. §§
1901-1908 and 8 U.S.C § 1182), providing authority for the application of
sanctions to significant foreign narcotics traffickers and their organizations
operating worldwide. Section 805(b) of the Kingpin Act blocks all property and
interests in property within the United States, or within the possession or
control of any U.S. person, which are owned or controlled by significant foreign
narcotics traffickers, as identified by the President, or foreign persons
designated by the Secretary of the Treasury, after consultation with the
Attorney General, the Director of Central Intelligence, the Director of the
Federal Bureau of Investigation, the Administrator of the Drug Enforcement
Administration, the Secretary of Defense, the Secretary of Homeland Security,
and the Secretary of State, as meeting the criteria as identified in the Kingpin
Act.

On July 5, 2000, OFAC issued the Foreign Narcotics Kingpin Sanctions
Regulations, 31 C.F.R. Part 598, which implement the Kingpin Act and block all
property and interests in property within the United States, or within the
possession or control of any U.S. person, which are owned or controlled by
specially designated narcotics traffickers, as identified by the President, or
foreign persons designated by the Secretary of the Treasury, after consultation
with the Attorney General, the Director of Central Intelligence, the Director of
the Federal Bureau of Investigation, the Administrator of the Drug Enforcement
Administration, the Secretary of Defense, the Secretary of Homeland Security and
the Secretary of State, as meeting the following criteria:

• Materially assists in, or provides financial or technological support for or
to, or provides goods or services in support of, the international narcotics
trafficking activities of a specially designated narcotics trafficker;

• Owned, controlled, or directed by, or acts for or on behalf of, a specially
designated narcotics trafficker; or

• Plays a significant role in international narcotics trafficking.

III. PROHIBITED TRANSACTIONS

E.O. 12978

E.O. 12978 blocks the property and interests in property in the United States,
or in the possession or control of U.S. persons, of the persons listed in the
Annex to E.O. 12978, as well as of any foreign person determined by the
Secretary of the Treasury, after consultation with the Attorney General and the
Secretary of State, to be a specially designated narcotics trafficker.

The names of persons and entities listed in the Annex to E.O. 12978 or
designated pursuant to E.O. 12978, whose property and interests in property are
therefore blocked, are published in the Federal Register and incorporated into
OFAC’s list of Specially Designated Nationals and Blocked Persons (SDN List)
with the OFAC program tag “[SDNT].” The SDN List is available through OFAC’s web
site: http://www.treasury.gov/sdn.

THE KINGPIN ACT

The Kingpin Act blocks all property and interests in property within the United
States, or within the possession or control of any U.S. person, of the persons,
identified by the President, or foreign persons designated by the Secretary of
the Treasury, after consultation with the previously identified federal
agencies.

So, what is the problem? Actually it is likely the top government officials of Mexico would be sanctioned and the government itself would fall. The other suggestion is U.S. domestic banks would be implicated as well as some city officials in the United States including Los Angeles, Chicago, New York, Newark and Miami.

The consequences are huge but it is time.

China’s Prison Labor Camps Proven

Posted on by

Primer:

The United States gives foreign aid to China. Actually, that is against the law. Hello Pelosi and Schiff. Oh but wait, it is all justified as money to counter those abuses. Anyone trust that actually or has anyone followed that money?

It is packaged this way: U.S. foreign assistance efforts in the PRC aim to promote human rights, democracy, and the rule of law; support sustainable livelihoods, cultural preservation, and environmental protection in Tibetan areas; and further U.S. interests through programs that address environmental problems and pandemic diseases in China. The United States Congress has played a leading role in determining program priorities and funding levels for these objectives. These programs constitute an important component of U.S. human rights policy toward China. Among major bilateral aid donors to China, the United States is the largest provider of nongovernmental and civil society programming, according to data compiled by the Organization for Economic Cooperation and Development.

Based on what abuses Beijing is applying to the freedom fighters in Hong Kong coupled with that of the prison labor camps (500 of them) of the Uighurs, having a trade agreement between the United States and China is an arguable quest at best or is it?

Uyghur Turk exposes torture in Chinese prison

The Uighur internment camps are actually prison labor camps for the Chinese Belt Road Initiative.

A classified blueprint leaked to a consortium of news organizations shows the camps are instead precisely what former detainees have described: Forced ideological and behavioral re-education centers run in secret.

The classified documents lay out the Chinese government’s deliberate strategy to lock up ethnic minorities even before they commit a crime, to rewire their thoughts and the language they speak.

The papers also show how Beijing is pioneering a new form of social control using data and artificial intelligence. Drawing on data collected by mass surveillance technology, computers issued the names of tens of thousands of people for interrogation or detention in just one week.

The documents were given to the International Consortium of Investigative Journalists by an anonymous source. The ICIJ verified them by examining state media reports and public notices from the time, consulting experts, cross-checking signatures and confirming the contents with former camp employees and detainees.

They consist of a notice with guidelines for the camps, four bulletins on how to use technology to target people, and a court case sentencing a Uighur Communist Party member to 10 years in prison for telling colleagues not to say dirty words, watch porn or eat without praying.

The documents were issued to rank-and-file officials by the powerful Xinjiang Communist Party Political and Legal Affairs Commission, the region’s top authority overseeing police, courts and state security. Much more detail here from Associated Press.

After bloody race riots rocked China’s far west a decade ago, the ruling Communist Party turned to a rare figure in their ranks to restore order: a Han Chinese official fluent in Uighur, the language of the local Turkic Muslim minority.

Now, newly revealed, confidential documents show that the official, Zhu Hailun, played a key role in planning and executing a campaign that has swept up a million or more Uighurs into detention camps.

Published in 2017, the documents were signed by Zhu, as then-head of the powerful Political and Legal Affairs Commission of the Communist Party in the Xinjiang region. A Uighur linguist recognized Zhu’s signature scrawled atop some of the documents from his time working as a translator in Kashgar, when Zhu was the city’s top official.

“When I saw them, I knew they were important,” said the linguist, Abduweli Ayup, who now lives in exile. “He’s a guy who wants to control power in his hands. Everything.”

Zhu, 61, did not respond to repeated requests for comment.

Long before the crackdown and despite his intimate familiarity with local culture, Zhu was more hated than loved among the Uighurs he ruled.

He was born in 1958 in rural Jiangsu on China’s coast. In his teens, during China’s tumultuous Cultural Revolution, Zhu was sent to Kargilik county, deep in the Uighur heartland in Xinjiang. He never left.

Zhu joined the Party in 1980 and moved up Xinjiang’s bureaucracy, helming hotspot cities. By the 90s, he was so fluent in Uighur that he corrected his own translators during meetings.

“If you didn’t see him, you’d never imagine he’s Han Chinese. When he spoke Uighur, he really spoke just like a Uighur, since he grew up with them,” said a Uighur businessman living in exile in Turkey, who declined to be named out of fear of retribution.

The businessman first heard of Zhu from a Uighur friend who dealt with the official while doing business. His friend was impressed, describing Zhu as “very capable” — a Han Chinese bureaucrat the Uighurs could work with. But after years of observing Zhu oversee crackdowns and arrests, the businessman soon came to a different conclusion.

“He’s a crafty fox. The really cunning sort, the kind that plays with your brain,” he said. “He was a key character for the Communist Party’s policies to control Southern Xinjiang.”

Ayup, the linguist, met Zhu in 1998, when he came to inspect his township. He was notorious for ordering 3 a.m. raids of Uighur homes, and farmers would sing a popular folk song called ‘Zhu Hailun is coming’ to poke fun at his hard and unyielding nature.

“He gave orders like farmers were soldiers. All of us were his soldiers,” Ayup said. “Han Chinese controlled our homeland. We knew we needed to stay in our place.”

Months after a July 5, 2009 riot left hundreds dead in the region’s capital of Urumqi, Zhu was tapped to replace the city’s chief. Beijing almost always flew in officials from other provinces for the job, in part as training for higher posts. But central officials on a fact-finding mission in Urumqi concluded that Zhu, seen as tougher than his predecessor, needed to take charge.

“They were super unhappy,” said a Uighur former cadre who declined to be named out of fear of retribution. “It had never happened before, but because locals said he was outstanding at maintaining stability, he was snatched up and installed as Urumqi Party Secretary.”

Upon appointment, Zhu spent three days holed up in the city’s police command, vowing to tighten the government’s grip. Police swept through Uighur neighborhoods, brandishing rifles and rounding up hundreds for trial. Tens of thousands of surveillance cameras were installed.

But instead of healing ethnic divisions, the crackdown hardened them. Matters came to a head in April 2014, when Chinese President Xi Jinping came to Xinjiang on a state visit. Just hours after his departure, bombs tore through an Urumqi train station, killing three and injuring 79.

Xi vowed to clamp down even harder.

In 2016, Beijing appointed a new leader for Xinjiang — Chen Quanguo. Chen, whose first name means “whole country”, had built a reputation as a hard-hitting official who pioneered digital surveillance tactics in Tibet.

Zhu was his right-hand man. Appointed head of the region’s security and legal apparatus, Zhu laid the groundwork for an all-seeing state surveillance system that could automatically identify targets for arrest. He crisscrossed the region to inspect internment centers, police stations, checkpoints and other components of an emerging surveillance and detention apparatus.

After Chen’s arrival, Uighurs began disappearing by the thousands. The leaked documents show that Zhu directed mass arrests, signing off on notices ordering police to use digital surveillance to investigate people for having visited foreign countries, using certain mobile applications, or being related to “suspicious persons”. State television shows that Zhu continued on his relentless tour of Xinjiang’s camps, checkpoints, and police stations, personally guiding the mass detention campaign.

Zhu stepped down last year after turning 60, in line with traditional practice for Communist Party cadres of Zhu’s rank. Chen remains in his post.

“Chen Quanguo came in the name of the Party,” said the Uighur businessman. “Zhu knows how to implement, who to capture, what to do.”

Thousand Talents = J Visa = Espionage = Stupid

Posted on by

It was just this morning that I sent a text to a former CIA operative asking if he was comfortable with the FBI being the lone government agency tracking foreign spies operating in the United States. His reply was NO. Sigh…My gut was telling me that espionage in the United States is out of control and while performing some research for about an hour, it IS out of control. Understand foreign operatives come from several countries into the United States using several visa methods and for the sake of this article, the concentration will be on China. It is a sure bet however, the same techniques are used by other rogue countries that just are for sure either best described as adversaries or enemies of our homeland.

So, back to the question of the FBI being the lone tracking government agency. One of the first Reuters articles had this headline: FBI wishes it had acted quicker as China stole intellectual property

The admission by John Brown, assistant director of the Counterintelligence Division at the FBI, backed up a Senate subcommittee report that found federal agencies had responded too slowly as China recruited the researchers, leaving U.S. taxpayers unwittingly funding the rise of China’s economy and military. Despite China’s announcement in 2008 of the Thousand Talents Plan – for which China had originally hoped to recruit 2,000 people but ended up recruiting more than 7,000 by 2017 – the FBI did not respond strongly until last year, the report released on Monday by the Senate’s Permanent Subcommittee on Investigations found. 

Just a few days before that Reuters’ article there was this headline: U.S. charges Chinese national with stealing trade secrets

Haitao Xiang, 42, an employee of Monsanto and its Climate Corp subsidiary from 2008 to 2017, was stopped by federal officials at a U.S. airport before he could board a flight to China carrying proprietary farming software, the department said in a statement.

“The indictment alleges another example of the Chinese government using Talent Plans to encourage employees to steal intellectual property from their U.S. employers,” Assistant Attorney General John Demers said.

Notice 9 years of employment above. Sigh. Read on, there is more.

US prosecutors have accused a tour guide of picking up US security secrets and delivering them cloak-and-dagger-style to Beijing. From October 2015 to July 2018, an FBI double agent conducted “dead drops,” in which, authorities say, Peng fetched information in the San Francisco Bay Area and Columbus, Georgia. Authorities say the double agent, identified only as “the Source,” went to the FBI in 2015, after the State Security Ministry tried to recruit him as a spy by telling him that he could rely on “Ed,” who had family and business dealings in China. As officials grapple with the threat of infiltrators trying to steal information from US companies, prosecutors have opened multiple cases against people suspected of spying for China. Last October, prosecutors charged a spy with attempting to steal trade secrets from several US aviation and aerospace companies.

Just last week in the Senate, the Homeland Security Committee Chairman, Portman held a hearing. Finding a summary from the hearing on the FBI website was the following:

Time and time again, the Communist government of China has proven that it will use any means necessary to advance its interests at the expense of others, including the United States, and pursue its long-term goal of being the world’s superpower by 2049. Among its many ways of collecting information, prioritized in national strategies such as the Five-Year Plan, the Chinese government oversees expert recruitment programs known as talent plans. Through these programs, the Chinese government offers lucrative financial and research benefits to recruit individuals working and studying outside of China who possess access to, or expertise in, high-priority research fields. These talent recruitment programs include not only the well-known Thousand Talents Plan but also more than 200 similar programs, all of which are overseen by the Chinese government and designed to support its goals, sometimes at U.S. taxpayers’ expense. Read on here.

Senate report accuses China of technology theft | NHK ...

200 similar programs? WHAT?

The Thousand Talents program is nothing more than a espionage recruiting operation. This past September, the FBI arrested Zhongsan Liu who was operating a front operation in New Jersey called the China Association for International Exchange of Personnel. According to the criminal complaint, Liu beginning in 2017 used the company to fraudulently procure U.S. visas for for many Chinese officials under J-1 research. Liu has actually led this front group however for 26 years. The program among others were created and directed by the Chinese government’s State Administration of Foreign Expert Affairs. Liu is a senior official of that agency. He also worked at the Chinese embassy in Washington and at the consulate in New York while this recruiting operation was going on.

“Chinese government sources claim over 44,000 highly skilled Chinese personnel have returned to China since 2009 through talent plans,” the report said. “As noted by China Daily, which is owned by the Chinese Communist Party: ‘China has more than 300 entrepreneurial parks for students returned from overseas. More than 24,500 enterprises have been set up in the parks by over 67,000 overseas returnees.'”

According to the Pentagon’s latest annual report on the Chinese military, the Thousand Talents Plan is used to bolster the People’s Liberation Army military buildup.

“China uses various incentive strategies to attract foreign personnel to work on and manage strategic programs and fill technical knowledge gaps, including the ‘Thousand Talents Program,’ which prioritizes recruiting people of Chinese descent or recent Chinese emigrants whose recruitment the Chinese government views as necessary to Chinese scientific and technical modernization, especially with regard to defense technology,” the report said.

The program of China’s Thousand Talents is really an unadvertised method to facilitate the legal and illicit transfer of U.S. technology, intellectual property and know-how as summarized by the National Intelligence Council.The NIC is a midterm and long term strategic thinking center formed in 1979. That report is found here. It is dated 2018 and titled: How China’s Economic Aggression Threatens the Technologies and Intellectual Property of the United States and the World

Do we really want a trade deal after all this with China? It can be argued that the trade has already taken place by China’s theft. This all complicates the bi-lateral signing of a trade deal between the United States and China or does it in the end?

Basic qualifications for the Thousand Talents program include the following:

1. Basic Qualifications for Candidates

The Recruitment Program for Innovative Talents (Long Term) targets people under 55 years of age who are willing to work in China on a full-time basis, with full professorships or the equivalent in prestigious foreign universities and R&D institutes, or with senior titles from well-known international companies or financial institutions.

2. Preferential Policies and Treatments

Awardees will be conferred the title of “National Distinguished Experts” and be provided with enabling working and living conditions.

(1) Enabling working conditions

Awardees are entitled to assume some leadership, professional or technical positions in universities, R&D institutes, central SOEs as well as state-owned commercial and financial institutions; to serve as project principals of the National Key Scientific and Technological Projects, “863 Program”(or the National High-tech R&D Program), “973 Program”(or the National Program on Key Basic Research Project), the National Nature Science Fund Projects; to apply for S&T funds and industrial development funds from government to support scientific research as well as production and operating activities in China; to participate in the consultation and demonstration of China’s major projects, the formulation of key scientific research plans and national standards, the construction of major projects, etc; to determine the expenditure and employment within the prescribed scope of responsibilities as project principals; to be engaged in various domestic academic organizations and the election of academicians of the Chinese Academy of Sciences and the Chinese Academy of Engineering(foreign academicians) and become the candidates of a wide range of government rewards.

(2) Special living benefits

Awardees as well as their spouses and minor children with alien nationality may apply for “Permanent Residence for Aliens” and/or multiple entry visas, the validity of which lasts 2-5 years. Awardees with Chinese citizenship will be free to settle down in any city of their choice and will not be restricted by his or her original residence registry. Each awardee shall receive a one-off, start-up package of RMB 1 million yuan from the nation’s central budget; be entitled to medical care, social insurance including pensions, medical insurance and work-related injury insurance; and may purchase one residential apartment for personal use. The housing and meal allowance, removing indemnity, home-leave-subsidy, and children-education-allowance in the wage income in Chinese territory within 5 years shall be deducted before taxes in accordance with relevant laws and regulations. Employers have to offer job opportunities to spouses, and children will have guaranteed admission to schools. The income level should be decided on their previous jobs overseas through negotiation with due living allowances.

(3) Key points of the Recruitment Program of Global Experts in the Field of Liberal Arts and Social Science

By the end of 2010, overseas high-level scholars in fields of liberal arts and social sciences, particularly urgently needed professionals specialized in Intellectual Property Law, Environment and Resources Protection Law, International Law, Diplomacy, Psychology etc. are eligible to apply for the Key National Innovative Projects. People who are introduced by this program shall support the Communist Party of China and the socialist system, maintaining compliance with the Constitution, laws, regulations and policies of the People’s Republic of China, with full professorships or the equivalent in prestigious foreign universities, R&D institutes and other institutions of art and culture, enjoying a high global reputation and being influential in their academic fields which are urgently needed in China; they shall be within 60 years of age, andd willing to work in China on a full-time basis.

With regard to application procedures, the “Liberal Arts and Social Sciences” plan is a subdivision of “The Recruitment Program for Key Disciplines”. Overseas talents are required to sign an employment contract or a letter of intention for talent recruitment with employers before applying for the Program. Please refer to the application procedures of “The Recruitment Program for Innovative Talents (Long Term)”.

 

 

 

Hong Kong is Facing Recession due to Protests

Posted on by

5 months of protests, fighting for real freedom has Hong Kong facing recession. Asian Airlines has cut flights due in part to cancellations by passengers for several airline carriers of up to 13%.

(UPI) — A government report last week projected a recession for the Hong Kong economy in 2019, which would be its first in a decade.

The forecast said the Hong Kong economy will have contracted by 1.3 percent by the end of the year, in no small part due to ongoing political protests that began to reject a proposed extradition law but have grown to include numerous issues.

Meanwhile, at the Polytechnic University where students and protestors were trapped, police fired rubber bullets and tear gas to keep the protestors from fleeing.

Police say 4,491 people, aged from 11 to 83, have been arrested since protests began in June.

Demonstrators are angry at what they see as Chinese meddling in Hong Kong’s promised freedoms when the then British colony returned to Chinese rule in 1997. They say they are responding to excessive use of force by police.

China says it is committed to the “one country, two systems” formula granting Hong Kong autonomy. The city’s police deny accusations of brutality and say they show restraint. More here.

The European Union and the United States have condemned the escalating violence in Hong Kong amid fears of a bloody crackdown as authorities laid siege to a university campus occupied by pro-democracy demonstrators.

Hundreds of anti-government protesters armed with petrol bombs and other homemade weapons had retreated to the Polytechnic University after a weekend of mayhem, which saw roads blocked, a bridge set alight and a police officer shot with a bow and arrow.

Protesters who tried to make a run for freedom were met with volleys of tear gas and rubber bullets.

‘Unacceptable’

A spokeswoman for foreign affairs at the European Commission expressed “deep concern” on Monday over reports that Hong Kong first responders and medical staff were being detained by law enforcement forces, preventing them from providing assistance to injured people.

“Any violence is of course unacceptable and any action by the law enforcement authorities must remain strictly proportionate and fundamental freedoms, including in particular the right of peaceful assembly and expression, must be upheld,” Maja Kocijancic told reporters.

Britain also described itself as “seriously concerned” over the violence on Monday with a spokesperson for Prime Minister Boris Johnson saying London continues to urge “restraint on all sides and support the right to peaceful protest.”

The Foreign Office added that “it is vital that those who are injured are able to receive appropriate medical treatment, and that safe passage is made available for all those who wish to leave the area.”

The United States had earlier condemned the “unjustified use of force” in Hong Kong and called on Beijing to protect Hong Kong’s freedom, a senior official in President Donald Trump’s administration said.

‘We need help’

According to Hong Kong’s Hospital Authority, 38 people were wounded during the night of Sunday to Monday.

Dan, a 19-year-old protester on the Polytechnic University campus, said protesters may need international help.”

“We’ve been trapped here for too long. We need all Hong Kongers to know we need help,” he added, bursting into tears. “I don’t know how much longer we can go on like this.”

Police, who have faced an array of weapons including petrol bombs, bow and arrows and catapults, urged protesters to leave.

“Police appeal to everyone inside the Polytechnic University to drop their weapons and dangerous items, remove their gas masks and leave via the top level of Cheong Wan Road South Bridge in an orderly manner,” they said in a statement.

One country, two systems

Recent days have seen a dramatic escalation of the unrest that has plunged the Asian financial hub into chaos for almost six months.

Demonstrators angry at what they see as Chinese meddling in Hong Kong’s promised freedoms when it returned to Chinese rule in 1997. They say they are responding to excessive use of force by police.

China says it is committed to the “one country, two systems” formula granting Hong Kong autonomy, with the city’s police accusations they use undue violence.

Chinese soldiers in a base close to the university were seen on Sunday monitoring developments at the university with binoculars, some dressed in riot gear.

Separately, Hong Kong’s High Court ruled on Monday that a British colonial-era emergency law revived by the government to ban protesters wearing face masks was unconstitutional.

It said the law was “incompatible with the Basic Law”, the mini-constitution under which Hong Kong returned to Chinese rule in 1997.

Syrian Henchmen Financial Sanctuary in Moscow

Posted on by

2011: Hillary Clinton declared that Bashir al Assad was a reformer.

Primer:

Rami Makhlouf: Wealthy, powerful cousin of Syria’s president

Makhlouf, 45, is Syria’s richest man and a member of what was described during U.S. Senate Committee on Foreign Relations hearings as a powerful “mafia” that also includes Syrian president Bashar Al-Assad, Makhklouf’s cousin. Before his country plunged into civil war, Makhlouf was allegedly worth $5 billion thanks to his control of monopolies and semi-monopolies in the air travel, telecommunications, real estate, oil and construction sectors. Makhlouf is on U.S. sanctions lists and is a known beneficiary of corruption.

***

Several Makhlouf family members, close cousins and accomplices of Syrian dictator Bashar al-Assad, have purchased tens of millions of dollars’ worth of properties in Moscow’s prestigious skyscraper district.

Headed by al-Assad’s uncle, Mohammed Makhlouf, the Makhloufs are considered to be Syria’s richest and second most important family. Before 2011, they controlled 60 percent of the Syrian economy, ostensibly acquired through years of corruption and intimidation.

GlobalWitness:

Our exposé of the Makhloufs’ properties is rare supporting evidence that lends substance to rumours of regime money being funnelled out of Syria throughout the war. Information about the regime’s assets and finances is notoriously scarce due to the terror fostered by al-Assad’s apparatus at home and abroad.

Our investigation further shows that the loans secured against some of the properties could be for the purposes of laundering money from Syria into Moscow. This opens the possibility that the money could then be moved into other jurisdictions, such as the EU, where members of the family are sanctioned.

Of the newly-revealed Moscow property purchases, the largest amount was bought by Hafez Makhlouf, one of Bashar al-Assad’s first cousins.

Hafez is accused of overseeing the killings and torture of detainees and protestors. Most of Hafez’s purchases were arranged using an opaque Lebanese loan structure that bears several hallmarks of money laundering, possibly with the purpose of moving the money beyond Russia.

Russia has been a key ally of the al-Assad family over their almost 50-year rule. It intervened on their side of the war in Syria in 2015, turning it in their favour through airstrikes and land offensives on opposition-controlled territory.

Reports of Russian banks aiding the Syrian regime surfaced in 2012 and 2013, after Western sanctions hit and the more powerful family members were stripped of European visas and their EU and Swiss bank accounts were frozen. Now it seems that the Syrian regime has been using Moscow as an alternative safe haven, and possibly a potential gateway for its ill-gotten gains to enter the wider financial system.

Hafez Makhlouf, who purchased US$22.3 million worth of property in Moscow’s ‘City of Capitals’ towers, was head of the Damascus ‘Section 40’ of Syria’s infamous General Intelligence Directorate until late 2014. This is the Syrian agency charged with quelling internal dissent, formerly and popularly known as the State Security service. As Damascus is the capital, this was already an important role, but Hafez appears to have had a great deal more authority than this official title reflects.

Testimony collected by Syrian human rights groups about Hafez’s Section 40 and its command branch, the Al-Khatib Branch, as well as wider testimony collected by journalists about the systemic use of torture by Syria’s intelligence services, points to how Hafez would have potentially overseen the detention of  thousands of Syrians and their subsequent abuse, and, in some cases, even murder.

Moreover, multiple regime defectors have since testified, in a 2019 book by journalist Sam Dagher, that Hafez was a hard-line member of Bashar al-Assad’s inner circle and one of his most influential advisers. According to the testimony, Hafez was one of two main advocates for crushing the demonstrations in 2011. Dagher’s book includes testimony from witnesses who saw Hafez shooting civilians in Douma and giving shoot-to-kill orders on hundreds of peaceful protestors in Daraa and Homs.

Makhlouf Family Tree Diagram english  When buying the Moscow office space in 2016, Hafez Makhlouf’s Russian-registered property companies took out loans using 11 of the properties as collateral. The complex structure of these loans disguises Hafez’s connection to the funds. This is characteristic of money laundering and could have been designed to establish money flows between Russia and Syria which would appear unconnected to Hafez, raising the possibility that the ultimate aim is to move the money out of Russia.

The loans were provided to Hafez’s Russian companies by a Lebanese company called Nylam SAL Offshore. The company is classified as ‘offshore’ in Lebanon; while Lebanese ‘offshore’ companies do not hide their owners like offshore companies in so-called secrecy jurisdictions like the British Virgin Islands, these companies do benefit from enhanced banking secrecy. The exact amount loaned by Nylam is unknown.

In 2018, two years after the property purchases, Hafez, the sole shareholder of his three Russian companies, passed his shares to Briana SAL Offshore, a Lebanese company with identical shareholders, directors and address as Nylam. Russian corporate records for the Russian property companies contain details about Briana because it is a shareholder. These records show that Briana states its country of business as Syria.

Russia’s biggest bank, Sberbank, provided banking services for at least one of the Russian property companies formerly owned by Hafez and now owned by Briana, a Russian corporate database shows.

As the loans from Nylam to Hafez’s Russian companies were international (coming into Russia from Lebanon), it is feasible that they were transacted in US dollars, which is the commonly used international currency. If that were the case, the money could have transited through Sberbank’s SWIFT payment system, which, according to anti-money laundering expert Graham Barrow, could risk breaching the terms of the US sanctions against Hafez Makhlouf.

The convoluted nature of the loans taken against the properties should have raised red flags with Sberbank, but it is unclear what due diligence was carried out on the loans.

Sberbank’s dealings with the Makhloufs are part of a broader pattern of major Russian banks helping the Syrian regime. In 2012 and 2013, both Reuters and Wall Street Journal reported that the al-Assad regime held accounts at Gazprombank and VTB, two of Russia’s largest banks, which, like Sberbank, have extensive international correspondent banking relationships. More here.