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tv   Economic Sanctions - Treasury Under Secretary  CSPAN  March 10, 2018 4:54am-5:35am EST

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begin. uncertainty and volatility in the trump administration sanctions policy, the private sector's response and the way forward. thank you very much to our panel -- panelists. -- panelists for next job this morning. morninglent job this [applause] . [captions copyright national cable satellite corp. 2016] [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. visit] the treasury department's undersecretary for terror and -- intelligence talks about economic pressure on north korea, russia, and venezuela. this is 40 minutes. >> it is my great pleasure to introduce undersecretary
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mandelker, the senior sanctions person in the u.s. government. someone who has the good luck to be in charge of a deeply confident organization in treasury. the bad luck with an issue where no matter how well we do, it will never satisfy anybody. so that's just life. she is exceptionally qualified. southern district new york, attorney's office, counselor to dhs secretary, deputy assistant attorney general and lots more. she has one other qualification which i want to emphasize. i suspect that undersecretary mandelker knows that public policy council. not inside the washington beltway, in terms of reputation, influence, positions, the next job.
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the town is for people. when you get it right, millions of people benefit. when policy goes wrong, people up in bad places, or dead, lots of them and real fast. i suspect she understands that. which is the essential ingredient to differentiate someone who simply does a job and someone who helps change the world. that's what public policy can be about. so with that, and my appreciation for coming, the floor is yours. [applause] undersecretary mandelker: thank you, dan. really, thank you. that's one of the kindest and most meaningful introductions i've ever received. i greatly appreciate it. thank you for inviting me to speak.
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as many of you know the office , of terrorism and financial intelligence, or tfi, is a close-knit family. it's always terrific to speak at an event with so many treasury alumni. i'm going to start with a bit of a history lesson. it's a history that i learned in my early months as undersecretary. it's part of the fabric of our organization. it has helped shape the foreign framework under which i view our mission and the way in which we execute that mission. it starts in 1940 during world war ii. a small group of very smart professionals and treasury led -- at treasury led by john kaylee and under the direction
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of then secretary henry morgan thou, recognized they could use economic authorities under the trading with the enemy act to nazis from seizing u.s. held assets of countries that the nazis were invading. and so, they set up an administrative agency called the and so, they set up an administrative agency called the office of foreign funds control, following the issuance of an executive order that prohibited financial transactions related to countries that germany occupied. the treasury department back then required financial institutions to freeze those assets, to ensure that these funds didn't fall into nazi hands. they were able to sieze and freeze billions of dollars, including in a number of dramatic ways.
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this was the predecessor agency to what we now know as the office of foreign assets control, or ofac. the treasury department didn't stop there. in 1943, after learning that jewish children were in hiding in nazi occupied europe, that same group of professionals resolved to find a way to use their authorities to help save those jewish children. they were asked by the world jewish congress to issue a license to authorize that funds be made available to help jewish children escape nazi controlled europe. they worked for months to secure they worked for months to
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secure this authorization, and enable the funds to be released to support this effort. they woo secure this authorization, and enable the funds to be released to support this effort. overcoming significant obstacles within the u.s. government to do so. having learned through this work about the atrocities happening in europe, secretary morgan found, john paley, and others believed that the u.s. government should do more to save the jews appear -- she was in europe. from late 1943-19 44, they pushed for the establishment of the war refugee board, read by john kaylee and other members of this. their role in saving the lives of thousands of holocaust survivors in the final years of world war ii, including through
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wallenberg.ul at the very same time these efforts were underway at the treasury department, my parents were jewish children hiding in europe. they were hiding underground in the forest, haystacks. they were also hidden by courageous individuals who risked their own lives and others. that my parents survived is nothing short of a miracle. to learn that there is a group in the treasury department, the office that i now oversee, working steadily to use the government's economic authorities to save jewish children in hiding, and others, it's truly remarkable and incredibly humbling. remarkable and incredibly humbling. morganthou secretary
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john paley, and others during world war ii provides the framework under which i view our role at tfi today. they recognize that the treasury department had unique economic authorities that they could deploy in a variety of ways. they worked steadily, strategically, smartly to figure out how to use those authorities in the most impactful ways. oft is an important element the approach that we are employing today, but with much more robust tools. tfi's components today include the office of terrorist financing and financial crime, office of intelligence and analysis, and the treasury executive office for asset forfeiture. within the components of tfi, we have a broad array of economic
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authorities and tools across a wide spectrum, including --ctions, usa patriot act of authorities like sections 311 b. 314 a and enforcement, international engagement, policy, intelligence , analysis, other regulatory authorities. 's authorities as operating as part of one continuing. for every problem we face, whether it's here in financing, proliferation financing, drug trafficking, human rights abuses, corruption and others, we are strategically deploying and integrating those tools best suited to the problems in come from entryways. is the only office of its type in the world that combines a broad array of economic tools and components.
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i always say that congress and the executive branch acted with tremendous precision in 2004, componentsut tfi's under one roof. this was truly a revolutionary development in the national security arena. nationalrrorism and security had traditionally been in the realm of foreign affairs, defense, intelligence, and law enforcement. treasuries authorities were brought together under one simple concept: bad actors cannot operate without funding. morganthou andry john paley did so many years ago, after 9/11, cfi set off to cut the terrorist --tfi set off to cut the terrorist asset by deploying new tools, as well as long-held authorities with renewed energy and strategic outlook. today, the -- to counter the threats we face across the
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globe, from murderous dictators preying on their own citizens, weapons proliferators like kim jong-un threatening united states and allies, terrorists murdering the innocent to sow instability, and others, we worked steadily to assess and analyze each threat. we use intelligence and other information to deploy a range of tools in innovative ways, constantly adapting to ensure they are properly synchronized and calibrated, to bring maximum economic leverage to bear. we also collaborate closely with with congress, allies across the globe. and with the private sector to him -- amplify our actions in a number of different ways. to further promote this integration and find new ways to pressure our adversaries, we are also setting up new strategic
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impact units within the treasuries existing structure. will bring together individuals representing tfi's components for strategies -- of our economic 30. thefiu's will focus on particular threats and systemic risks. these will harness years of deep expertise in complex issue areas, and working together, they will recommend strategies to further help raise our economic authorities. will regularly assess the threats of our actions to continually sharpen our efforts and tactics. ourintegrated use of authorities must be part of a broader strategic plan. fi has -- as i have said a number of time, sanctions alone are not a foreign policy.
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sanctions are a tool among our many authorities we used to achieve a particular objective -- particular objectives. they are in our agency strategies that include other economic authorities, diplomacy, intelligence, law enforcement, other elements of national power. let me give you a few examples of how we are using our authority in integrative and integrated ways to face the challenge -- for the challenges we face. am going to start with north korea. the north koreans told our south korean allies that they will refrain from testing more missiles and nuclear weapons, and they are willing to denuclearize. they made such promises in the past, but they will test their sincerity now that's president trump has agreed to meet the north korean leader. it's clear our maximum pressure campaign has brought us to this juncture. north korea proposes an early
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threat for which we are using our entire arsenal of economic authorities. theirars, they used ballistic missile programs with little global oversight. north korea has been watching -- launching missiles, and has boasted that it's weapons of mass destruction can reach american cities. korea, north korea has developed a brutal state apparatus to coerce, control, and punish ordinary citizens and any who might contemplate defense. it's estimated that tens of thousands of political prisoners are detained and in elaborate network of prison camps, just one of which is three times the size of washington dc. nations, to the united inmates in these camps have been subject to deliberate ,tarvation, executions, rape
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forced abortions. when facing a regime and leaders who prioritize power over people, we have brought our economic authorities to bear, to change our calculus and siphon enabled hims that to continue to proliferate. we cannot tolerate the threats of this regime armed with nuclear weapons for the citizens of the world. together with our allies, we have been intensifying our campaign until north korea achieves complete verifiable and irreversible denuclearization. ago, we announced the largest sanctions package ever. 27 entities, 28 vessels abroad. there are flags and countries a class to grope -- across the globe.
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we've combined this with other tools. on that same day, ambassador enlisted ass to be the u.n.. we also have a glowing shipping advisory, along with our shippings in the u.s. department and coast guard, highlighting to the world north korea's shipping practices. after her designations, i met with representatives from jurisdictions of those entities to urge them to take swift .ction against entities that's if they have not already done so. we are synchronizing our actions to maximize the impact of these crucial, economic authorities. have built on our full-court efforts to maximize pressure on the kim regime. over the last year, in addition to tufts security council resolution, -- resolutions, the treasury has designated over 200
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individuals and entities in connection with north korea. we have amplified this pressure in other ways. includes actions we have brought under section 311 authority, the usa patriot act, including cutting off a chinese bank from the u.s. financial system when we found it to be a money laundering concern for facilitating north korean money laundering and sanctions evasion. a few weeks ago, we again use this authority to identify a lobbying bank that had, among other things, processed transactions connected -- with parties connected to north korea launderingy on a concern, and to propose similar restrictions. we have also enlisted the private sector in this fight, providing information to financial institutions to highlight how north korea disguises, moves, and wonders funds to finance its nuclear and ballistic missile programs. i have also conducted a number
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of private sector roundtables, including in my recent travels to asia and europe, where i tell financial institutions that they need to be extraordinarily bitter lent to make sure north korea is not moving money to the banks. we also work closely with the strict7 to encourage implementation and compliance standards for counter clerk -- counter proliferation financing. while our sanctions 311 actions, and extended outreach are each powerful, by bringing them all regime, wethe kim the impact our pressure campaign. it starting to have an impact. turning to iran. guard has spread its tentacles across the middle east. they promote instability in syria, and support murder --
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murderers president bashar al-assad. the irgc and its force contribute to violence and instability in yemen by sending military equipment to the huts'' s and have engaged in an -- and a counterfeiting scheme. they provide upwards of millions the year to hezbollah, which continues to threaten our close ally israel, including using rockets to target israeli cities . at the same time, the iranian regime are beautifully -- brutally suppressive at home. over the last couple of months, iranian citizens have taken to the streets, loudly shouting that they have had enough of the regimes correction -- corruption. grave riskone so at to their own lives, as the regime has thrown protesters in jail, violently censored its
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under this administration, we have designated targets in the .iddle east, asia, and europe two pushback on iran's activities, we magnify our powerful sanctions with our international engagement and clear messaging to the private sector. there is no transparency to speak of in iran, and there are massive deficiencies in their anti-money laundering regime. extensiveas an presence in iran's economy which is of secured by this lack of transparency. in our engagements both here and abroad, we have made clear that companies doing business in iran face substantial risk.
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we will hold those knowingly doing business with the irgc and others about that finance the regime's malign activities to account. decade, there highlighted the terrorist risk from iran and the threat it imposes to the international financial system. a threat so significant that countermeasures were imposed and 2015 when iran committed to an action plan. at the same time, they remain on the status blacklist. weeks ago, they concluded that they had failed to fulfill their commitment to implement its action plan. they have made it clear that the owners and responsibility fall upon iran, and it specifically call them out for failing to address the majority of the
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action plan requirements. for the first time ever in a public statement, they provided a comprehensive list of iran's major deficiencies, highlighting its terrorist financing and reiterating the threat it imposes to the international system. they made clear that appropriate measures need to be passed and implemented. onare also very focused pressuring russia for its continued efforts to destabilize ukraine, occupy crimea, metal in fortions, as well as corruption and human rights abuses. this administration has sanctioned 100 individuals and entities under our ukraine and russia related sanctioned authorities. these designations are in addition to our other efforts to hold russia accountable for its actions including our think sitting of russia's targeted
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activities related to the north korea sanctions program. 26, recently, on january 2018, we sanctioned 42 individuals and entities related to russia and ukraine, including a number who helped russia transfer turbines to crimea in clear violation of our sanctions. the following week, we submitted a report to congress under senior political figures and oligarchs in the russian federation. was extensive report which coordinated a very closely with the intelligence community, including our office of intelligence and analysis contained an extremely thorough analysis that is being used to inform future targeted sanctions. we have taken other vigorous steps to implement the program.
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during the fall of 2017, treasury amended and reissued directives 1, 2, and four of the sanctions. are targeting of russian companies that do business with rogue regimes around the world includes the independent petroleum company, a russian company that signed the contract to provide oil to north korea and reportedly ship petroleum as well to north korea, as other companies engaged in sexual activity related to north nal activityctio related to north korea. the administration also recently toued a public attribution
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the russian military. these actions build on our government effort to counter russia's aggression. in venezuela, the regime has continued to undermine democracy, impoverish its citizens, and lose the country to line his pockets. the regime puts salt on democracy combined with its irresponsible economic policies have had a devastating impact on venezuela. food and medicine have become increasingly scarce. food scarcity is not accident. weaponime uses food as a and to enrich itself while refusing to allow humanitarian assistance into the country. he is a dictator who once again prioritizes power over people. to counter his continued assault
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on democracy and his own people, we are using our sanctions authorities to target those in the regime responsible for the country's dire economic, social, and political situation, as well as those engaging in a list of activities. on the secretary's first day in office, he announced the designation of venezuela's executive vice president for playing a significant role in international narcotics trafficking and the designation assistingnt man for him. their designation disrupted their ability to launder millions of dollars in assets associated with him. they have since been blocked. since then, we have sanctioned 44 more current and former government of venezuela government officials.
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recently, we announced the designation of four senior military officers on jamie fifth, 2018 -- january 5, 2018. this executive order limits of the ability of the government and its companies, including in the energy sector, to secure financing for international markets. it also cuts the regime off from important revenue streams. in september 2017, another amplifying action issued an advisory to alert financial institutions of widespread public corruption in venezuela and a message that senior political figures and their associates may use to move and hide proceeds of their corruption. at the great expense of the venezuelan people.
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combined with our powerful targeted sanctions and other public messaging, this advisory put financial institutions on watch for possible illicit fund flow. at the same time we are taking action through our economic authorities, we are also working with our international partners to bring additional pressure, including through multilateral sanctions on the regime. anding to global corruption human rights abuses. into many countries across the world, innocence live under fear of arbitrary kidnapping and imprisonment, deprivation and starvation, forced labor and torture, and even execution. corrupt pedicle of -- political leaders embezzle their country's wealth at the expense of their citizens. elicit traffickers prey upon
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innocent people, selling them tradelavery or the slave -- sex trade and even exploiting them for their organs. they undermine the foundation of stable, secure, and functioning society. they devastate individuals, weaken democratic institutions, and degrade the rules of law. they perpetuate violence conflict and undermine economic markets. they threaten the integrity of the u.s. and international financial systems. this administration is undertaking a campaign against those who prey on the vulnerable and violate the inalienable rights of their citizens. we are imposing financial consequences on those who pillage the wealth and resources of their people and generate joke on profits from corruption,
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cronyism, and criminal activity. 2017, president trump signed an executive order and limiting the global accountability act, authorizing sanctions on persons involved in serious human rights abuses or corrections across the world. as part of that announcement, this administration imposed sanctions on 52 individuals and entities. they include billionaire dan gutler who amassed his version -- fortune and correct mining and oil deals in the democratic republic of the congo. nicaragua's supreme electoral council has been accused of a massing sizable personal wealth and has been
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described as above the law. bernie's army official -- burmese army official who oversaw actions for widespread judicial pilling, sexual violence, and arbitrary arrests. treasury designations send a -- powerful message to those who blatantly abuse human rights to line their pockets with riches at the expense of the innocent. human rights abusers and the corrupt are on notice. we are watching and we will take action. these designations are about impact. these sanctions have directly affected the ability of these corrupt individuals to access the funds. we couple these efforts to human rights abusers with the correct and other authorities.
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2017, alongside our sanctions, alerting u.s. financial institutions to the exposure of south sudanese senior political officials. we also seek to bolster the impact of our actions through coordination with our international partners. for example, the eu imposes sanctions on many of the same individuals we have targeted in south sudan, the drc, and elsewhere. we are now working with the eu and other like-minded partners to encourage them to develop similar authorities of their own. additionally, we conduct extensive outreach to our international partners following the publication of treasury action. as an example, after the september 2017 actions against south sudanese senior global figures, we immediately engage with neighboring governments asking them to investigate the
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illicit financial flows from these senior political figures too their countries, and similarly conduct outreach in the private sector to counter corruption by south sudanese officials. terrorist financing. every day we are using our authorities to counter isis, al and others who engage in and support terrorism. we have made great progress against these groups, including isis. anywhere theyd operate. target thesenue to terrorist organizations including cutting them off from their affiliates across the world. likewise, since then, have been working to tackle the threat posed by isis and isis inspired foreign terrorist fighters.
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will leverage the data they collect in order to investigate foreign fighters and the logistical networks and to share information with our domestic and international partners. we amplify the impact of our and measures for international coordination and cooperation. --important addition initiative is the targeting center, collaborating -- a collaborative effort. it is a joint effort between the u.s. and gcc countries. through it, we have already taken coordinated, multilateral actions to disrupt terror finance networks. in october 2017, all members of c designated leaders
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who are directly responsible for perpetuating the violence plaguing yemen and a the security of the entire region. this initiative is a top national security property -- priority for this administration, and we are continuing to work with all of those countries to fully realize division. as you can see, treasuries authorities continue to serve as some of this administrations top noncanonical's of choice. non-kinetic tools of choice. we also need to add to our resources. takesing our authorities a tremendous amount of hard work, strategic thinking, and and intelligence. that is why we have asked congress for more resources. the administration recently
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requested $25 million above the president's fy 2018 budget for and immediately deploy additional resources to counter threats posed by north korea. the president's fy 2019 budget request a $40 billion increase from our current operating level million increase from our current operating level. we need more people and even better tools. ago,town hall a few months i also started my remarks by speaking about the history of this great organization. i asked that each person in the shoesut themselves in the of those treasury officials over 70 years ago who founded
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strategic and innovative ways to deploy economic authority to keep assets out of the hands of that actors and to save victims of the holocaust. as i asked them to put themselves in the shoes of them, i reminded them that is exactly where they are today. there are terrible things happening around the world right now. we live in a time where there are grave threat to our country. each one of our career professionals stand as an important part of the mission to keep not only our country safe, but to prevent and deter other threats around the world by illicit actors and financiers. we are dedicated to take our work further. i cannot be any prouder to lead this effort.
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thank you. [applause] [captions copyright national cable satellite corp. 2017] [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. visit] president trump's decision to meet with kim jong-un in the coming weeks. with respect to talks with north korea versus negotiations, i think this seems to be something that people continue to struggle with. conditions have been are not right for negotiations. we have been saying we are open to talks. trump has said for some time he is open to talks. he is willing to meet with kim jong-un.
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i think the judgment is right now. yesterday, i was indicating comments about negotiations. we have been open for talks for some time. in terms of the decision to engage between president trump and kim jong-un, that is a decision the president took by himself. i spoke to him very early this morning. we had a good conversation. this is something he has had in mind for quite some time. way, not a surprise in any because this is something he has expressed openly before about his willingness to meet with kim jong-un. i think it is a question of agreeing on the timing of that first meeting between the two of them, and the location, and that will take some weeks before we
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get that all worked out. so, no surprise. we know there has been a lot of discussion, and you have been reading about it to. we also have been having contacts back and forth with them as you are well aware of channels we have had opened for some time. i think this was the most forward leaning report that we have had in terms of kim jong-un 's strong desire for talks. what changed was his posture in a dramatic way that came as a surprise to us. that he was so forward leaning in his conversations with the delegation from south korea. white house press secretary sarah sanders was asked about a potential timetable for talks with north korea during her daily briefing with reporters. that was one of several questions on the topic of north korea. this is 25 minut


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