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Letter to The Honorable Timothy Geithner, Secretary of the Department of the Treasury


Location: Washington, DC

U.S. Rep. Nan Hayworth, M.D. (R-NY) has sent a letter to Treasury Secretary Timothy Geithner asking him to address concerns regarding transactions with the Palestinian Authority. These concerns are a result of the recent announcement that both Fatah and Hamas Parties will jointly select Ministers to govern Gaza and the West Bank in preparation for Palestinian elections next year. Hamas is considered by the United States to be a terrorist organization, and therefore its participation in Palestinian government may necessitate that transactions with the Palestinian Authority be considered to be financing terrorism.

In her letter, Hayworth asked Secretary Geithner to clarify the process for determining whether transactions with a Palestinian government that includes Ministers selected by Hamas may result in the funding of terrorist activities and, if so, the process for determining whether such transactions should be prohibited.

"Treasury has been a leader in global efforts to fight the financing of terrorism and it has protected Americans during a challenging and difficult time," Hayworth said. "But the prospect of Hamas taking an active role in governing Palestine raises new concerns about proceeds of transactions with the Palestinian government being used to finance terrorist activities. Therefore I've asked Secretary Geithner to address these concerns as soon as possible."

Designated as a foreign terrorist organization by the U.S. Department of State, participation by Hamas in the selection of Ministers to govern the West Bank and Gaza raises concerns similar to those raised by the Treasury Department in 2006.

Text of the letter can be found below or in PDF format here.

Text of the Letter:

June 8, 2011

The Honorable Timothy Geithner
The Department of the Treasury
1500 Pennsylvania Ave., N.W.
Washington, D.C. 20220

Dear Secretary Geithner:
The U.S. Department of Treasury (the "Treasury Department") has been a leader in the global efforts to prevent the financing of terrorism and played a critical role in protecting our country during a difficult and challenging time. Your ongoing work in this area is commendable and I thank you and the Treasury Department for your continued efforts.

As you know, the Treasury Department's Office of Foreign Assets Control ("OFAC") is responsible for administering sanctions programs with respect to terrorists and terrorist organizations. Pursuant to Executive Order 12947 of January 23, 1995, Executive Order 13224 of September 23, 2001, and the Antiterrorism and Effective Death Penalty Act of 1996 (P.L. 104-132), HAMAS has been designated by OFAC as a terrorist organization and sanctions have been enforced against the group.

In 2006, members of HAMAS constituted a majority party within the Palestinian Legislative Counsel. As a result, OFAC determined that HAMAS had a "property interest" in the transactions of the Palestinian Authority and prohibited U.S. persons from engaging in transactions with the Palestinian government unless licensed. (71 Fed. Reg. 27199 (May 10, 2006).) OFAC established six licenses authorizing a limited number of specific transactions with the Palestinian Authority. However, in 2007, when the Palestinian Authority subsequently established a government that did not included ministers affiliated with HAMAS, OFAC established a broader license authorizing U.S. persons to engage in all transactions with the Palestinian government. (72 Fed. Reg. 61517 (Oct. 31, 2007).)

Recently, Fatah and HAMAS announced their intention to jointly select Ministers to govern the West Bank and Gaza. I am concerned that transactions with a Palestinian government that include Ministers selected by HAMAS may result in the funding of terrorist activity. To address this concern, I would appreciate clarification regarding, if Ministers selected by HAMAS are included as part of the Palestinian Authority, how OFAC will determine whether transactions with the new government will result in the funding of terrorism. Additionally, how will OFAC determine if transactions by U.S. persons with the new Palestinian government are prohibited?

I appreciate your assistance with these concerns. Please contact my staff if you have any questions.
Very truly yours,

Nan Hayworth, M.D.
Member of Congress

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