I would like to welcome all of you to todays program on financing terrorism. Of the many aspects of the fight against terrorism, cutting off the financial flow is most critical. It is the oxygen that keeps these groups alive and allows them to recruit, control plan operations on the global level. It remains a top seekity for the u. S. As we to defeat the Islamic State and other terrorist groups. Arab. S. And its Gulf Partners have taken significant steps to stem the flow of funds to terrorist groups over the years, a robust effort since 9 11. However, despite the measures put in place, those organizations continue to generate income from the region to finance their activities. What more can be done regionally and globally to stem the flow of money to violent extremists . We have a very distinguished to answer the question and explore the issues related to. I am pleased to welcome our speakers juan carlos zarate, kate ba and and steveu, who wille introduce ther panel and moderate, the program. Welcome. I look forward to a good discussion today. Marcelle. You, ou i am delighted to introduce my colleagues to talk about this subject, a very timely one at the moment. My introductions will be short. You can look for detail in your programs that were under your chair when you walked in. Let me briefly institute kate at thea fellow Washington Institute for near east policy and former treasury official who served as the department attache in the gulf region. To her right is david, a former director of the Intelligence Agency and better known to me in his role the treasury before he joined the cia where he was under the under secretary for terrorism and financial intelligence. A left, the for chairman and cofounder of the financial integrity network, and i knew juan for some time when he worked as the National Security adviser from 2005 until 2009. Other details here. For the sake of time, we will get on with our conversation. What i would like to do is give each of our guests the chance to of the largersue sense and i will ask a question, they can all respond to it and focus on whatever issues, whatever angles they find most useful. I am hoping we can get at this from a number of different angles and develop a full picture of what we see out in the gulf. Were going to do this in reverse of a medical order. Has to gos zarate first, which he never got to do in grade school [laughter] mr. Seche so, the question is, isthe extent that the u. S. Lf, arabing with gu states to what extent are they fish during . Thank you for the invitation to be here. I count myself incredibly fortunate to have learned and bening government when you both were serving and to have learned at your feet was a great honor and to have learned with dave and and kate as well. I am probably the least of the experts here. But i am happy to contribute as i can. I think that there has been a Natural Evolution to the counterterrorist financing between the u. S. And our gulf allies and it obviously started post9 11 with a dramatic focus on a much more preventative framework for dealing with illicit funds and support to terrorist organizations. Ways, the early days of that cooperation was remedying or dealing with the pre9 11 framework for how the gulf was dealing with groups tied to al qaeda or supporting them. It is no secret and certainly has been the subject of lots of conferences and reports as to how we dealt with saudi arabia in those early days, dealing with the reality of the pocket donors, network supportive of al qaeda prior to 9 11. Charities and nonprofit organizations which became a major subject of attention for the u. S. And our gulf allies, and then putting in place the tools and strategies to allow us to prevent groups like al qaeda from gaining support and financing from the gulf. A story with many chapters to it, but the bottom rely verye u. S. Has heavily on that cooperation over time, one that has matured both in terms of how we get financial intelligence, which david can speak to better than anybody, what we have done in preventative terms to create systems that do not allow low system enter the at least theoretically, dealing with state sponsorship questions, making sure there is clarity that states should not find or create mechanisms to support terrorist groups, and then trying to find ways of targetsacting against supporting terrorist groups. In the early days post9 11 we had a number of these designations with the kingdom of saudi arabia. We have had continuous efforts in that same vein, including with carter. An evolution to actually focus on this in a fundamental way. One thing i would say, and this goes to marcelles point at the introduction these issues are more fundamental than they ever were before. Because the issues of how groups like al qaeda, groups like daes h, successor groups are raising funds, running war economies and developing Global Networks is more critical now than ever before. There has been much in the literature about the folly of. Ollowing the money i think it is critical to think about how these types of groups are able to gain support, sustain themselves and build their networks and global ambition because of the support that they have. These issues are so important today. In terms of the rift, it is clear to me from an american standpoint, the rift is a burden and a barrier to cooperation. We have built our counterterrorist financing, our playbook around the idea we need allies onoperative the ground. Not just in a bilateral context, but a regional context. And where we have had the most success in this regard and you know this from your work in yemen and elsewhere, where we have had the most success has been where light commanded allies are working together to gather information, gather around a common strategy and mission, and then figuring out where there is a division of labor around the kinds of actions needed to deter and support terrorist financing networks. To the extent that it creates levels of mistrust, to the extent that it ruptures elements of information sharing, that is all not good from an American Perspective and everything we can do to repair the relationship, to focus on preventing terrorist financing is critical. There are lots of complications, definese as to how you terrorism, what we mean by terrorist financing. All of those are implicated. But fundamentally from an American Perspective, there is a need to have global, regional, and in the case of the gulf states, gcc level cooperation to deal with what is still a Critical National and interNational Security issue. Thank you so much. You raised a couple of really interesting points. Lets get back to the Financial Model the organizations are collective gcc as well as bilateral and how that breaks down on the ground. For that, we will go to david and ask you for your view on this. Mr. Cohen sure. Thank you, steve, thank you marcelle, for asking me to be here. I think it is worth at the outset noting how important it that we have a strong and fully functioning and fully staffed state department. Although this is an advertisement for the Treasury Department, we are all former treasury officials the work we have been able to do countering terrorist financing, not to mention many, many other empowered and functioning. You can applaud. So, just a couple quick thoughts picking up on what juan was saying. Terrorists to combat financing, i came to the treasury in 2009. That was at a point where juan and his team had made an inrmous amount of progress combating the principal problem, which was funding coming out of saudi arabia. Stewart famously said if he could snap his fingers and into the terrorist financing out of saudi arabia, that would make a big difference. That did not make him that popular with ambassador in saudi arabia at the time. By the time i got there in 2009 the saudis had shifted quite theiricantly in perception of this issue and their willingness to work with the u. S. I then had the opportunity to try to build on those efforts. The we did in my tenure at treasury, which spanned from 2009 until 2015 was principally to work i laterally, and i think this bears the question of how bilaterally, and i think this bears on the question of how important it is to be on a gcc. I am large olive the efforts that we undertook were bilateral, with the saudis, with the varieties. Emirates. E the sharing of intelligence information, which is critical to identify who the terrorist financiers are, how they are raising money, moving money, that also tended to be, i think, exclusively is probably the right word. Exclusively bilateral. The only exception in my recollection was we made some sfforts to enlist the saudi to work with us in a trilateral fashion with kuwait and qatar. I remember a couple of occasions where we would be in saudi, the folks who were most important in the interior we would trye and to get them to essentially to put pressure with us on qatar and kuwait. That did not work so well. Too fine a point on it. I think it was for a variety of reasons. Working in a trilateral fashion and working in a gcc more broadly was not something we really tried to, try to pursue. Situation in the , if right now where you see think, a real potential for the gcc to splinter and for qatar to go its way in the saudis and and the saudis and the emirates to go their way with the other states following in line, i think that it itself is not the problem. I think the bigger problem is you have qatar, which had been making progress in recent years prosecuting terrorist financiers, being a little bit more forward leaning in its efforts, no longer feeling that it is in the club inside the tent. The,e lose a little bit of sort of the moral suasion that comes from a combined effort of folks in the gulf. That is to i am worried about in the current situation. The progress we have seen with the with qatar in the last couple of years, which has been hard one, lots of efforts from treasury and state and others to move qatar along, that that will begin to receive. And i will make one final point. We can pick up on it later. The other thing that you all know happened recently in the gulf, i think, has significant implications for the future of counterterrorism financing is the switch and the crown prince in saudi arabia. The crown prince ousted and also ousted from his position as the minister of the interior. He was a stalwart partner of the United States in combating terrorist financing and really bringing saudi arabia to a point where it was doing a quite good job across the board in combating terrorist financing. With him no longer in the position in the interior ministry and no longer in position in the government, the United States has lost a key partner in this effort, and i think that is something we need to watch very carefully. It was obviously not him by but his position in that family, and that government was in norma import. Hand, the crown prince does not have a was ous in normas of enorm import. On the other hand, the conference does not have experience. It is the harcourt hardcore what hobby hardcore approach that saudi arabia has been promulgating around the world. That could have a beneficial impact on terrorist financing. , but around saudis the arab world. Why dont i stop there . Thank you. We will get back to this question, dynamics in states, even within states. Kate, over to you. You can assess the risks and opportunities, if there are not any we have recognized. Ms. Bauer great. Thank you for inviting me to join. Im really honored to be here with these men who have been great friends and mentors over many years. And i have to say after speaking with the two of them, i have to agree with what with a lot of what they said, but i think i will find a couple points to push on a little bit. Thatnk i agree with david have arabia and the uae galvanized action against terrorist financiers that were operating and continue to operate in qatar, and they felt that there is a sense that qatar does not share the same threat and the uae. Saudi this allows them to pursue at different times multilateral attempts, whether they are the trilateral attempts that david mentioned or another iteration efforts to designate has blocked as a terrorist organization and the mechanisms that go along with that, commitments that were made at the camp david summits under the Obama Administration to pursue andilateral efforts activity in the region. These desires to bring the gulf get attogether to try to a more Common Threat perception ociated with this activity the repeated kind of inability to do that is reflected in the current risk, i think. That is how it is a part of this current risk as well. Some actions the of taking action against individuals. Listedve said to you and individuals their assets of been frozen, there are travel bans in place and there have been prosecutions. And also systematically. They pass legislation to better regulate charities, better activities, to criminalize certain types of fundraising or expression on social media. But that there are few signs of what specific actions they have taken under this legislation or really a lot of details about what prosecutions or other Law Enforcement efforts there have been. I think that is wherein lies an opportunity out of this risk and the role that saudi and the uae they published a list the couple weeks ago i think of 49 individuals and the number of entities, and herein, i think, lies an opportunity to press first of all, against the human individuals, to make sure they are no longer able to actively finance or qatar. Ate in i think one good thing would be qatar would implement or adopt a National Antiterrorism Committee and number of years ago and its place within the ministry of the interior, although it is an interagency this group has the ability to designate terrorist financiers beyond what is at the u. N. And the propagation of such a list could help clarify some of the actions or some of the unclear signals that you see to, for really dig in example, what the state department has said. On one hand, qatar shut down a charity located to al qaeda in march,but then just this in a designation release, designation of a kuwaiti individual, that he was working with the individual who had run that qatari charity. So, despite the fact that the charity has been shut down, the individual continues to finance or facilitate terrorist financing activities. I think theres a lot of unclear signals and this is an opportunity to get some clarity on that. Mr. Seche thank you very much, kate. Let me just for a moment open this up more probably. There is at least one other theres a lot of interest of the white house on counterterrorist financing. It was interesting, the readout issued after presence of spoke to leaders july 2, there were two defendants as an two mentions of his decisive focus on counterterrorist finances. Its clearly on his mind. We see the rhetoric. We hear the rhetoric. Do we need to focus on a change of policies on the grounds that will distinguish this white house approach to counterterrorist financing from, you know, his predecessor or others . And to what extent do we see this targeting iran, since iran is largely on the presents mind when he looks out at the arab gulf . On the president mind when he looks out at the arab elf . Do we detect any shifts . Juan, if you want to start on that . Mr. Zarate to me, its incredibly refreshing. I started at the treasury and get ahere it was hard to seat at the table. To see the centrality of terrorist financing for those of us who are true believers in the imports of these issues, it is very heartening and the fact that it was such a centerpiece of the presents visit to saudi arabia seeks to the importance of these things and issues. This is such a principle issued from a regional perspective. That is perhaps not altogether different from the Obama Administration and the Bush Administration, but the fact come out of the box so strong and full throated around the issue of terrorist financing is significant. It does put a marker down that this will be an issue that the administration, even if they do not have an articulated strategy yet will have to contend with in complicated ways. The other thing that is interesting and i have argued this for a long time the hass on terrorist financing often very thorny and strategic diplomatic issues. Things that are focused that are forced to the surface because of terrorist financing. How do we look at the Muslim Brotherhood . One as aignate terrorist supporter as we look at his support of the families of suicide bombers . The decision of the Bush Administration was we will look at the Muslim Brotherhood through a variety of lenses and see where they were actually said wording militant and thatrist causes and where occurred, we were not going to turn a blind eye. We were not going to go after it. The same thing with wahabi proselytization outside the borders of the kingdom, places asia, southeast asia. These are things that emerged not because we wanted to create how do you think of charity in places of extreme me . Places like east africa where we haveterrorist groups exploited those funds, but we know that charities have hit the ground to help people in dire need. How do we think about state sponsorship . What does that mean . Seeope, steve, is what you emerging out of this is not just dealing with the tactical money dimensions of who is a terrorist financier, that is important, but how do you deal with these more fundamental issues. I think with the serious people that we have on the inside, secretary mattis, ms. Powell we worked with her on these issues at the state department i hope that will be a focus on these more fundamental issues that are tied to the issue of terrorist financing. Mr. Seche great. David, any changes that you see shaping up at all . No obligation. Ms. Bauer i think it sends a signal in the rollout of this threat financing, one of the key deliverables that this was signals theat importance to the gulf states, but also the administration. With that, you have seen a pretty cool pretty smooth thation in the division david had david headed previously. You have a team in the Treasury Building ready to work with the white house, ready to use these sorts of tools. In an lot of fronts, where , it isns can be used important to have the policy f