US praises Swiss crackdown on terror financing

Juan Carlos Zarate is in charge of cracking down on terrorist financing. US Treasury Department

One day after Washington warned of a new al-Qaeda attack in the United States, a top Treasury official has praised Swiss efforts to combat financial terrorism.

This content was published on May 27, 2004

Juan Carlos Zarate told swissinfo he welcomed the government’s efforts to clamp down on the flow of terrorist funds through Switzerland.

Zarate was speaking following talks in Bern with the Swiss federal prosecutor, Valentin Roschacher, and officials from the finance ministry and Federal Banking Commission.

His meeting with Roschacher came as the US Attorney-General, John Ashcroft, announced that he had “credible intelligence” that al-Qaeda was planning an attack on US soil “in the next few months”.

As the deputy assistant secretary for terrorist financing and financial crime at the US Treasury Department, Zarate is responsible for coordinating Washington’s efforts to fight financial terrorism and money laundering.

He has made several visits to Switzerland over the past few years.

swissinfo: How much cooperation are you receiving from the Swiss government in the fight against financial crime?

Juan Carlos Zarate: We have a very good working relationship with the Swiss government.

Switzerland is a key global financial centre and has the ability to affect both the flow of capital and the behaviour of other financial centres around the world.

We have been cooperating very closely to the extent that we now have our own people working here in Bern with the prosecutor’s office to deal with [specific] cases that arise.

swissinfo: What more could Switzerland be doing to track and prevent the flow of terrorist funds?

JCZ: The main message is really ‘more of the same’. What is important is continued due diligence by the regulatory authorities and the private sector in Switzerland to ensure that financial institutions are not used to store or transfer terrorist money.

We would also like to see continued aggressive investigations by the prosecutor’s office and further cooperation between all our different agencies.

swissinfo: To what extent does Swiss banking secrecy hinder attempts to locate suspected terrorist funds?

JCZ: We have not seen banking secrecy as a hindrance. If there is a suspicion of terrorist links, the Swiss government and even the private sector is more than willing and able to track the flow of money.

The prosecutor’s office has done a very good job of accessing accounts and information that is relevant to their and our own investigations.

swissinfo: Interpol has expressed concern that the production of counterfeit goods is a potentially lucrative source of terrorist income. Was this an issue you raised with the Swiss authorities?

JCZ: Absolutely. We are finding that the more we manage to isolate terrorist groups, the more we see al-Qaeda cells having to fend for themselves.

This has led to the phenomenon of independent cells… which have to generate funding in any way possible.

swissinfo: Money transfers are a multi-billion dollar business. Are you concerned that terrorists could be transferring funds in this way?

JCZ: We have been working to ensure that we and our partners abroad have a comprehensive system to regulate and create transparency in the money transfer sector.

What we need in Switzerland and elsewhere is not only greater transparency and accountability in this sector but also greater enforcement of the law to target those who are engaged in risky transactions or suspicious activities.

swissinfo: Doesn’t the latest warning of a new attack on US soil suggest that Washington and the international community in general are failing to stop the flow of money to terrorists?

JCZ: We are facing a grave challenge. The fight against terrorism and terrorist financing is one that will go on for many years. This is not a one- or two-year task and we have by no means claimed victory.

What we have done – largely thanks to the cooperation of countries like Switzerland – is debilitate al-Qaeda to the extent that we think they are having great trouble raising money and moving it around the world. The less money they have now, the less able they are to recruit and train for future activities.

One of our goals must be to dismantle terrorist networks that we identify. Here in Switzerland we saw a good example of this with the arrest of eight individuals who appear to have been providing support for last May’s bomb attacks in [the Saudi Arabian capital] Riyadh. These arrests, as well as the freezing of assets, continue to be an important element of the campaign.

swissinfo: Switzerland has always stressed that the fight against terrorism should not be at the expense of human rights and international law. Do you agree?

JCZ: I don’t think that respect for human rights clashes with the war on terrorism and terrorist financing. We must uphold the rule of law as part and parcel of the campaign against terror. It is respect for human rights that distinguishes us from the terrorists.

The Swiss government has done a very good job of respecting the principles that they consider to be important while still remaining nimble with respect to accessing and sharing information and taking action to dismantle terrorist support networks.

swissinfo-interview: Ramsey Zarifeh

Key facts

Juan Carlos Zarate is the Deputy Assistant Secretary at the US Treasury’s Office of Terrorist Financing and Financial Crime.
He is responsible for ensuring that Treasury assets and powers are used to hinder terrorist financing, money laundering and financial crimes.
Zarate held talks in the Swiss capital, Bern, with the federal prosecutor, Valentin Roschacher and with officials at the finance ministry and Federal Banking Commission.

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In compliance with the JTI standards

More: SWI certified by the Journalism Trust Initiative

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