TNAG-1996-FCO40-2843-Hong-Kong-Drug-Trafficking-(Recovery-of-Proceeds)-Ordinance--1991 — Page 285

UNCLASSIFIED

UNCLASSIFIED

FM FCO

TO PRIORITY HONG KONG

TELNO 1363

OF 23173OZ JUNE 89

Mkn 385/2

INFO PRIORITY WASHINGTON, PEKING

40

052632

MDLOAN 3291

три

یم کا بلکہ تا

YOUR TELNO 1999: KERRY AMENDMENT TO ANTIDRUG ABUSE ACT

1. THE KERRY AMENDMENT REQUIRES THE US GOVERNMENT TO NEGOTIATE ARRANGEMENTS WITH OTHER COUNTRIES UNDER WHICH FOREIGN BANKS WOULD KEEP RECORDS OF ALL TRANSACTIONS OF OVER DOLLARS 10,000 AND ESTABLISH MECHANISMS UNDER WHICH SUCH RECORDS WOULD BE MADE AVAILABLE TO US LAW ENFORCEMENT OFFICIALS. THIS MIRRORS THE APPROACH TAKEN BY THE US IN THEIR DOMESTIC LEGISLATION.

2.

IN CONTRAST THE 1986 DRUG TRAFFICKING OFFENCES ACT

(SECTION 24) PROVIDES FOR BANKS AND OTHERS TO REPORT ONLY TRANSACTIONS THEY BELIEVE TO BE SUSPICIOUS TO THE AUTHORITIES. THE LATEST DRAFT WE HAVE SEEN OF YOUR LEGISLATION (SECTION 26)

CONTAINS SIMILAR PROVISIONS.

3. THE UK/US DRUGS AGREEMENT PROVIDES FOR MUTUAL ASSISTANCE IN THE FIELD OF INVESTIGATION OF DRUG TRAFFICKING OFFENCES. UNDER THE AGREEMENT WE ARE ABLE TO PROVIDE THE US AUTHORITIES WITH INFORMATION INCLUDING BANK RECORDS. HOWEVER, WE DO NOT ENVISAGE AUTOMATICALLY MAKING AVAILABLE TO THE US REPORTS WE RECEIVE OF SUSPECT TRANSACTIONS IN US DOLLARS OR INDEED IN ANY OTHER CURRENCY. WE ENVISAGE ONLY RESPONDING TO SPECIFIC REQUESTS FROM

THE AMERICANS LINKED TO PARTICULAR INVESTIGATIONS BY US ENFORCEMENT AUTHORITIES.

4. NEVERTHELESS WE HOPE THAT THE US AUTHORITIES WILL ACCEPT THAT THE UK/US AGREEMENT MEETS THE REQUIREMENT OF KERRY TO ESTABLISH MECHANISMS FOR THE EXCHANGE OF INFORMATION. AT OUR MEETING WITH THE US EMBASSY ON 23 MAY ABOUT THE KERRY AMENDMENT (COPY OF RECORD

ALREADY FAXED TO ASSISTANT POLITICAL ADVISOR) WE EXPLAINED WHAT WE COULD DO FOR THE AMERICANS UNDER THE BILATERAL AGREEMENT. US TEAM ACCEPTED THAT THE AGREEMENT PROVIDES FOR A SUBSTANTIAL DEGREE OF BILATERAL COOPERATION BUT ADDED THAT IT WOULD NOT SATISFY THE SPECIFIC REQUIREMENTS OF KERRY. WE NOTED THAT WE DID NOT REGARD THIS AS REPRESENTING A PROBLEM FOR THE UK.

5.

THE

WE AGREE THAT IT WOULD BE SENSIBLE TO WAIT UNTIL IT IS CLEAR

1

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