Office of the Coordinator for Counterterrorism

Country Reports on Terrorism 2012

Report

May 30, 2013

Country Reports on Terrorism

Various transnational terrorist organizations continued activities in the East Asia and Pacific region during the year, while the nature of the terrorist threats evolved. In January, Thai authorities arrested a Hizballah operative, who led Thai officials to a significant cache of explosives and bomb making materials. The following month, two Iranians were arrested in Bangkok after accidentally discharging explosives allegedly intended to target Israeli diplomats. A third Iranian was arrested while transiting Malaysia, and two others successfully fled Thailand. All of the Iranian operatives used Malaysia as the entry and exit points for the region as they travelled to and from Bangkok. While still vulnerable to terrorist activity, Malaysia achieved significant legal reforms in 2012 by repealing its Internal Security Act and moving its counterterrorism approach away from detention without trial to a criminal prosecution-based system.

In the Philippines, terrorist acts were generally limited to criminal activities designed to generate revenue for self-sustainment, such as kidnapping for ransom or extortion, but members of terrorist groups were suspected to have carried out several bombings against public and private facilities primarily in the central and western areas of Mindanao. The Government of the Philippines moved toward a peace agreement with the Moro Islamic Liberation Front (MILF) by signing a Framework Agreement on the Bangsamoro in October. A comprehensive peace agreement with the MILF has the potential to improve peace and security in Mindanao.

The shift from large-scale assaults to smaller-scale attacks on domestic targets continued in Indonesia with attacks on police, including the murder and possible torture of two officers who had been investigating an alleged terrorist training camp that was associated with Jemaah Anshorut Tauhid. Militants also attempted to assassinate a provincial governor with a pipe bomb in the midst of a large crowd. Jemaah Islamiya member Umar Patek – the principal bomb maker in the 2002 Bali bombings – was found guilty and sentenced to 20 years in prison. Indonesia continued its close multilateral cooperation in Southeast Asia, most notably as co-chair of the Global Counterterrorism Forum’s (GCTF) Southeast Asia Working Group and as co-chair of the ASEAN Defense Ministers Meeting Experts’ Working Group on Counterterrorism.

Australia maintained its position as a regional leader in the fight against terrorism and worked to strengthen the Asia-Pacific region’s counterterrorism capacity through a range of bilateral and regional initiatives in organizations such as ASEAN, the ASEAN Regional Forum, and the Pacific Island Forum. Australia is also co-chair of the GCTF Southeast Asia Working Group. The Japanese Government continued to participate in international counterterrorism efforts at multilateral, regional, and bilateral levels through the Seventh ASEAN-Japan Counterterrorism meeting and the Japan-China Counterterrorism Consultations. Australia, Indonesia, Japan, China, and New Zealand are founding members of the GCTF. The Government of the Philippines hosted the second GCTF Southeast Asia Working Group meeting in November, which focused on youth radicalization.

Overview: China’s cooperation with the United States on counterterrorism issues remained marginal with little reciprocity in information exchanges. China continued to expand cooperation with countries in the region and conducted joint counterterrorism training exercises with Indonesia, Kazakhstan, Kyrgyzstan, Pakistan, Russia, Tajikistan, and Thailand. China’s domestic counterterrorism efforts remained primarily focused against the East Turkestan Islamic Movement (ETIM) in the Xinjiang Uighur Autonomous Region (XUAR) of northwest China. In public statements, government officials singled out the “Three Evils” of extremism, separatism, and terrorism in Xinjiang as the main terrorist threat to the nation and characterized Uighur discontent as terrorist activity. Human rights organizations continued to maintain that China used counterterrorism as a pretext to suppress Uighurs, a predominantly Muslim ethnic group that makes up a large percentage of the population of the XUAR.

2012 Terrorist Incidents: The Chinese government characterized two incidents in the XUAR as terrorist attacks. On February 28, nine violent extremists armed with knives attacked a crowd in Kashgar prefecture, reportedly killing 15 and injuring 16 pedestrians. Seven of the attackers were reportedly killed in the ensuing clash with police, and the alleged ringleader, a Uighur, was sentenced to death. On June 29, six Uighurs allegedly attempted to hijack a Chinese airliner en route from Hotan to Urumqi, and injured 10, reportedly using aluminum pipes from a dismantled pair of crutches. According to official Chinese media, three Uighurs were sentenced to death and one received life in prison after reportedly confessing to the crimes of organizing, leading, or participating in a terrorist group, hijacking, and attempting to detonate explosives on an aircraft.

Legislation, Law Enforcement, and Border Security: In March, China’s National People’s Congress amended the country’s criminal procedure law to include measures to provide protection for witnesses, victims, or their close relatives whose personal safety is at risk because of their testimony in cases involving, among other things, crimes of terrorism. The new legislation, which came into effect January 2013, also includes controversial measures that strengthen Chinese authorities’ ability to arrest and detain individuals suspected of “endangering state security or crimes of terrorism.” This legislation includes a clause that allows for detention without notification of a suspect’s relatives in terrorism-related cases where such notification may “impede the investigation.” The Chinese typically did not provide public information on law enforcement actions in response to terrorist attacks. Two exceptions were domestic media reports of trial results for those accused of participating in the two attacks cited above.

Although China continues to stress the importance of counterterrorism cooperation, Chinese law enforcement agencies remained reluctant to conduct joint investigations with U.S. law enforcement agencies or provide assistance in cases involving suspected terrorists.

Countering Terrorist Finance: China is a member of the Financial Action Task Force (FATF) and the Asia/Pacific Group on Money Laundering (APG), a FATF-style regional body. In October 2011, the Chinese Government established a legal framework and administrative authority for enforcing UN designations: the “Decision of the Standing Committee of the National People’s Congress on Strengthening Counterterrorism Work” and the accompanying “Statement of Decision on Strengthening Counterterrorism Work.” This authority provides the legal basis for the establishment of a national interagency terrorist asset freezing body that, if robustly implemented, should strengthen China’s implementation of UNSCRs 1267/1989, 1988, and 1373.

Because the People’s Bank of China, the Ministry of Public Security, and the Ministry of State Security are currently drafting implementing regulations for the Decision of the Standing Committee of the National People’s Congress on Strengthening Counterterrorism Work and the accompanying Statement of Decision on Strengthening Counterterrorism Work, the impact of these new regulations remains to be seen. Although mandatory, Chinese courts still do not systematically pursue the confiscation of criminal proceeds, including terrorist assets. Regarding the monitoring of non-profit organizations, China has a deep and far-reaching system of oversight; however, there were no identifiable measures or requirements specifically for preventing terrorist finance abuses in this sector. For further information on money laundering and financial crimes, we refer you to the 2013 International Narcotics Control Strategy Report (INCSR), Volume 2, Money Laundering and Financial Crimes: //2009-2017.state.gov/j/inl/rls/nrcrpt/2013/

Regional and International Cooperation: Throughout the year, China publicly affirmed its commitment to working with international partners to counter terrorism. China continued to voice support for three UNSC committees – the 1267 Committee, the Counterterrorism Committee, and the 1540 Committee. China is a founding member of the Global Counterterrorism Forum and in June, supported the establishment of the International Center for Excellence for Countering Violent Extremism in Abu Dhabi. In January, China participated in the third APEC workshop on counterterrorism finance and the nonprofit organization sector.

China cooperated with other nations on counterterrorism efforts through military exercises and assistance. In May, China hosted Thai marine forces in Guangdong province for joint counterterrorism drills (Blue Commando 2012). In July, Tajikistan hosted Shanghai Cooperation Organization members China, Kazakhstan, Kyrgyzstan, and Russia for counterterrorism exercises (Peace Mission 2012). Also in July, China and Indonesia held their second round of counterterrorism exercises in China (Sharp Knife 2012).

Hong Kong

Hong Kong continued its effective security and law enforcement partnership with the United States, including through the Hong Kong Customs and Excise Department’s successful joint operation of the Container Security Initiative, and through participation in U.S.-sponsored capacity building training in counterterrorism-related topics, and through engagement with the U.S. military. In ratifying UN Conventions on terrorism, the People’s Republic of China has specified that the treaties would also apply to the Hong Kong Special Administrative Region, which has subsequently implemented the Conventions through local ordinance. In July, Hong Kong further strengthened its UN Anti-Terrorism Measures Ordinance by replacing the term “funds” throughout, with the more comprehensive term “property,” to cover terrorist assets of every kind. Counterterrorism, through policies on prevention, protection, and preparedness, remained an operational priority for the Hong Kong Police Force. The Police Security Wing coordinated potential terrorist threat information with relevant counterterrorism units. The Police Counterterrorist Response Unit provided a strong deterrent presence, assisting police districts with counterterrorist strategy implementation, and complementing the tactical and professional support of existing police specialist units, such as the Explosive Ordnance Disposal Bureau, Special Duties Unit, and the VIP Protection Unit.

Hong Kong is a member of the FATF, the APG, and the Egmont Group of Financial Intelligence Units. Terrorist financing is a criminal offense in Hong Kong, and financial institutions are required to continuously search for terrorist financing networks and screen accounts using designations lists made by the United States under relevant authorities, as well as the UN 1267 Sanctions Committee’s consolidated lists. Filing suspicious transactions reports irrespective of transaction amounts is obligatory for financial institutions, but Hong Kong lacks mandatory reporting requirements for cross-border currency movements. In April, Hong Kong’s Anti-Money Laundering and Counterterrorist Financing Ordinance went into effect mandating customer due diligence and record-keeping in the financial sector as well as imposing statutory supervision over money changers and remittance agents. For further information on money laundering and financial crimes, we refer you to the 2013 International Narcotics Control Strategy Report (INCSR), Volume 2, Money Laundering and Financial Crimes: //2009-2017.state.gov/j/inl/rls/nrcrpt/2013/vol2/index.htm

Macau

Macau’s counterterrorism cooperation with the United States included information exchange as well as regular capacity building through the International Law Enforcement Academy (ILEA) and other international organizations. Under the Macau Public Security Police Force, the Police Intervention Tactical Unit (UTIP) is responsible for protecting important installations and dignitaries, and for conducting high-risk missions, such as deactivation of improvised explosive devices. UTIP’s Special Operations Group conducts counterterrorism operations. Macau law enforcement officers attended U.S.-sponsored capacity building training at ILEA on cargo targeting and interdiction, and post blast investigations.

Macau is a member of APG and the Egmont Group of Financial Intelligence Units. Terrorist financing is a criminal offense in Macau, and banks and other financial institutions are required to continuously search for terrorist financing networks and screen accounts using U.S. designations lists, as well as the UN 1267/1989 and 1988 Committees’ consolidated lists. Filing suspicious transactions reports irrespective of transaction amounts is obligatory, but Macau lacks mandatory reporting requirements for cross-border currency movements.

Macau’s Financial Intelligence Office (FIO) signed a Memorandum of Understanding to cooperate formally with Fiji’s Financial Intelligence Unit, making this the eleventh such agreement since the FIO’s inception in 2006. Macau cooperated internationally in counterterrorism efforts through Interpol and other security-focused organizations.

Overview: A decade after the 2002 Bali bombings, Indonesia continued its counterterrorism efforts and initiatives and cooperated with a range of partners, including the United States. Law enforcement authorities made a series of preemptive arrests in 2012, demonstrating enhanced investigative techniques and an increasing ability to disrupt terrorists’ plans before they could carry out attacks. Despite the security challenges inherent in governing a nation composed of more than 17,000 islands, authorities were diligent in efforts to deny terrorists a safe haven. Police conducted raids at several locations, including in Poso, Central Sulawesi, where authorities began operations in October to disrupt an alleged terrorist training program associated with Jemaah Anshorut Tauhid.

In May, authorities arrested suspected terrorists based in Medan, North Sumatra, who had hacked into a multilevel marketing website and transferred funds to private accounts. This trend of terrorists seeking illicit funding through online crime is new to Indonesia. Limited weapons smuggling, often through the Philippines, posed an ongoing challenge. Authorities have expressed concern that, in some cases, explosive devices were of increasing sophistication.

Indonesia worked with international partners, including the United States, to deter and prevent terrorist attacks. Coordination among the various agencies responsible for preventing terrorism and prosecuting terrorists continued to pose challenges. Indonesia has sought to address this through better training for law enforcement, prosecutorial, and judicial officials, and by encouraging better information sharing between stakeholder agencies.

2012 Terrorist Incidents: Continuing a trend in recent years, terrorists targeted Indonesian law enforcement officials. Incidents included:

• In August, terrorists attacked police in the Central Java city of Surakarta (also known as Solo). On August 17, two police officers were shot by a passenger on a motorcycle. On August 18, a grenade was thrown at a police post, resulting in damage to the building. On August 30, a police officer was shot and killed by terrorists.

• On August 31, during a police raid, one law enforcement official was killed and one terrorist suspect was arrested. Two suspected terrorists were also killed during the shootout. Both had been students at Al Mukmim Islamic boarding school in Solo, had links to regional terrorist groups, and had participated in terrorist training in the Philippines.

• In the fall, terrorists in Poso targeted civilians, police, and public officials in a series of violent attacks. Two police officers who had been investigating an alleged terrorist training camp in Poso were found murdered on October 16, bearing signs of torture.

• On October 18-22, bombs were placed near police facilities, a church, a market, a home, and a vacant lot in Poso. Three people were injured, though not all of the bombs detonated.

• On November 11, suspected Poso-trained militants tried to assassinate the Governor of South Sulawesi with pipe bombs during a public rally in Makassar. The bombs did not detonate, however.

• On November 15, a suspected terrorist tried to assassinate the Chief of Police in Poso at his home, but the shooter missed and the officer was uninjured.

Legislation, Law Enforcement, and Border Security: In 2012, a multi-agency drafting team under the guidance of Indonesia’s Ministry of Law and Human Rights was revising Indonesia’s 2003 antiterrorism law. New provisions being considered would strengthen the legislation to better facilitate the investigation and prosecution of terrorism cases by: addressing the material support of terrorism; better facilitating the use of intelligence information: extending the detention period that police may hold suspected terrorists before filing charges; and outlawing membership in, and training with, terrorist organizations.

Police arrested more than 150 people on charges of terrorism, and in the process of arrest, killed 10 suspects.

• In March, five suspected terrorists were killed on the resort island of Bali as police tried to arrest them. Authorities believed the group may have been planning an attack similar to the 2002 and 2005 attacks against tourist sites on Bali.

• In early May, police arrested 12 terrorists who were connected to the 2011 suicide bombing of a Christian church in Solo, Central Jakarta, and were involved in hacking a multilevel marketing website to fund terrorist activities, including a terrorist training camp in Poso, Central Sulawesi.

• In early September, police made a series of arrests after bomb making facilities were discovered at two separate locations in the greater Jakarta area. Nitroglycerine was found at one of the sites, a first-time discovery of this substance linked to bomb making in Indonesia.

• In late October, police arrested 11 suspected terrorists in a series of coordinated raids at four locations on the island of Java. A list of possible targets that included U.S. diplomatic facilities was among the items seized. Three suspected terrorists were killed in police operations in Central Sulawesi, and nine others were arrested in separate operations in Central and South Sulawesi.

• Raids following the attacks on Poso police resulted in the arrests of dozens of suspects. At least three suspected ring leaders were killed and authorities seized weapons, extremist publications, and explosive materials during the raids.

The Attorney General’s Office received 42 terrorism cases to prosecute. As of early December, at least three cases were completed, 18 were under review, and 22 were in the trial stage. In February, the Supreme Court rejected the appeal of Abu Bakar Ba’asyir to overturn his conviction on charges of terrorism and reinstated a 15-year sentence. This reversed an October 2011 decision wherein judges at the Jakarta High Court threw out the original 15-year sentence and issued a nine-year jail term based on lesser charges.

In mid-April, seven members of a radical group were found guilty of plotting to poison the water and food supplies at a police cafeteria in Jakarta and sentenced to jail terms ranging from three to five years. This case prompted authorities to express concern about terrorists obtaining chemical and biological agents for use in attacks.

On June 21, judges at the West Jakarta District Court announced a guilty verdict and 20-year jail sentence for Umar Patek. The trial lasted four months and featured testimony from victims and legal experts, including American witnesses. Patek was found guilty on all six counts for terrorist actions spanning more than a decade. He was the last remaining terrorist yet to be sentenced for the 2002 Bali bombings, for which he was the principal bomb maker.

Indonesia remained an important partner nation in the Department of State’s Antiterrorism Assistance program, which provided enhanced training in investigative and tactical skills for Indonesian National Police officers, including elite units that regularly conducted major operations against terrorists in the region.

Countering Terrorist Finance: Indonesia belongs to the Asia/Pacific Group on Money Laundering, a Financial Action Task Force (FATF)-style regional body. In February 2012, FATF placed Indonesia on its Public Statement list because of Indonesia’s failure to make sufficient progress in implementing its anti-money laundering/combating the financing of terrorism action plan. Indonesia faces possible FATF sanctions for failure to pass terrorist financing legislation. At year’s end, revised terrorist financing legislation was pending before parliament.

Indonesia continued to lack a comprehensive law to implement UNSCRs 1267 and 1373, though the AML legislation provides for the freezing of terrorist assets linked to the UN List of designated terrorists and terrorist organizations. The Indonesian Financial Intelligence Unit routinely shared designated terrorists and terrorist entities with banks nationally through the Central Bank of Indonesia, but this had little effect since Indonesian authorities have not used existing regulations to freeze assets under UNSCR 1267. For example, Indonesia made little to no progress in freezing assets of JAT and three of its members after they were placed on the UNSCR 1267 list in March and April. Prosecutors and police need additional training to be able to convincingly follow and explain the money trail in a court of law. Judges also need training on money laundering and financial crimes. Corruption, particularly within the police ranks, also impeded effective investigations and prosecutions. Charitable and religious institutions remained largely unregulated, although the Indonesian government was looking at creating an administrative process to monitor nonprofit organizations.

For further information on money laundering and financial crimes, we refer you to the 2013 International Narcotics Control Strategy Report (INCSR), Volume 2, Money Laundering and Financial Crimes: //2009-2017.state.gov/j/inl/rls/nrcrpt/2013/vol2/index.htm

Regional and International Cooperation: A founding member of the Global Counterterrorism Forum (GCTF), Indonesia and Australia co-hosted the GCTF’s inaugural South East Asia Capacity Building Working Group meeting in Semarang, Indonesia on March 6-7. Indonesian officials regularly participated in GCTF events throughout the year. On March 20, the Indonesian House of Representatives formally ratified the ASEAN Convention on Counterterrorism.

Countering Radicalization and Violent Extremism: The Government of Indonesia broadened its efforts to counter radicalization and violent extremism. The Vice President’s office convened an interagency taskforce charged with creating a blueprint for counterterrorism that includes initiatives to counter violent extremism. In concert with other government agencies, the National Counter Terrorism Agency (BNPT) developed plans for a media campaign to counter extremist narratives. BNPT identified schools, universities, and religious institutions as targets for outreach efforts. BNPT enlisted repentant terrorists to publicly denounce violence at book launches and other public venues. For example, on June 20, BNPT organized a launching of the book The Cloud of Jihad authored by Khairul Ghazali, a repentant violent extremist currently serving a five-year jail term. BNPT invited members of extremist groups to the event with the aim to open dialogue among groups that hold divergent beliefs. The Ministry of Religious Affairs held a symposium in September called “The Strategic Role of Religious Education in the Development of a Culture of Peace.”

BNPT also established a Terrorism Prevention Communication Forum in 15 of Indonesia’s 34 provinces as a means to better coordinate counterterrorism efforts at the local level, and plans are underway to expand the program. Recognizing that campuses are sometimes recruiting grounds for violent extremists, BNPT co-sponsored a religious education curriculum workshop in Solo as an effort to undercut radical messages being spread on some university campuses. Plans were underway to open a rehabilitation and de-radicalization center for imprisoned terrorists in Sentul, one hour south of Jakarta. This facility, where terrorist prisoners would serve the latter part of their jail terms, would help prepare convicted terrorists for successful and nonviolent reintegration back into society after their release. However, reforming the Indonesian corrections sector remained a daunting challenge, and the government had no comprehensive or standardized system in place to handle terrorist prisoners.

NGOs complemented government efforts with civil society members, academics, and victims of terrorism engaged in outreach and programs, primarily to students at educational institutions in communities identified as most vulnerable to violent extremism.

Overview: The Democratic People's Republic of Korea (D.P.R.K.) is not known to have sponsored any terrorist acts since the bombing of a Korean Airlines flight in 1987. On October 11, 2008, the United States rescinded the designation of the D.P.R.K. as a state sponsor of terrorism in accordance with criteria set forth in U.S. law, including a certification that the D.P.RK. had not provided any support for international terrorism during the preceding six-month period and the provision by the D.P.R.K. of assurances that it would not support acts of international terrorism in the future.

Four Japanese Red Army members who participated in a 1970 jet hijacking continued to live in the D.P.R.K. The Japanese Government continued to seek a full accounting of the fate of 12 Japanese nationals believed to have been abducted by D.P.R.K. state entities in the 1970s and 1980s. Despite two rounds of D.P.R.K.-Japan bilateral talks in the latter half of 2012, the D.P.R.K. had not yet fulfilled its commitment to re-open its investigation into the abductions.

Legislation, Law Enforcement, and Border Security: In May, the United States recertified North Korea as “not cooperating fully” with U.S. counterterrorism efforts under Section 40A of the Arms Export and Control Act, as amended. In making this annual determination, the Department of State reviewed the D.P.R.K.’s overall level of cooperation with U.S. efforts to combat terrorism, taking into account U.S. counterterrorism objectives with the D.P.R.K. and a realistic assessment of D.P.R.K. capabilities.

Countering Terrorist Finance: The D.P.R.K. is not a member of the Financial Action Task Force (FATF) or the Asia-Pacific Group (APG) on Money Laundering, a FATF-style regional body. Throughout the year, the FATF reiterated its concern about the D.P.R.K.'s failure to address “significant deficiencies” in its anti-money laundering/combating the financing of terrorism (AML/CFT) regime. In 2012, D.P.R.K. officials engaged the FATF and the APG to discuss technical issues. While the FATF welcomed such engagement and noted that it remained open to “assisting the D.P.R.K. to address its AML/CFT deficiencies,” the D.P.R.K. appeared to have made little meaningful progress in strengthening its AML/CFT infrastructure. In an October public statement, FATF renewed its call on members to “apply effective countermeasures to protect their financial sectors” from the “on-going and substantial money laundering and terrorist financing…risks” posed by the D.P.R.K. For further information on money laundering and financial crimes, we refer you to the 2013 International Narcotics Control Strategy Report (INCSR), Volume 2, Money Laundering and Financial Crimes: //2009-2017.state.gov/j/inl/rls/nrcrpt/2013/vol2/index.htm

Overview: While the Republic of Korea has no active counterterrorism cases, it continued to take terrorism seriously and cooperated with U.S. counterterrorism efforts. Information sharing through formal and informal channels has been strong and responses to requests for information positive. The 18^th Republic of Korea National Assembly session expired on May 28, without passing the Counter-Terror Prevention Act bill. First proposed in late 2001 shortly after September 11 by the 16^th National Assembly, the bill has faced consistent opposition from civic groups and the National Human Rights Committee.

Legislation, Law Enforcement, and Border Security: The Republic of Korea has met the requirements for information sharing under the Visa Waiver Program. In January, the Republic of Korea began collecting the biometric data of foreign nationals aged 17 and over at ports of entry. Through the Preventing and Combating Serious Crime agreement, U.S. law enforcement will be able to use this biometric data to identify terrorists and criminals and share relevant information.

Countering Terrorist Finance: The Republic of Korea is a member of the Financial Action Task Force (FATF) and the Asia/Pacific Group on Money Laundering, a FATF-style regional body. In February, the National Assembly approved an amendment to the Financial Transaction Reports Act imposing stricter penalties on financial institutions that violate reporting requirements, which the Financial Intelligence Unit (FIU) had submitted in December 2010. On June 13, 2012, the FIU submitted a separate bill amending the Financial Transaction Reports Act to abolish the suspicious transaction report threshold. The bill was submitted to the National Assembly in November. To meet the global standard, the FIU revised the Enforcement Decree of the Prohibition of Financing for Offenses of Public Intimidation Act in September. The Republic of Korea actively cooperated with authorized investigations involving or initiated by international organizations, and shared the records or related information with foreign authorities. In this regard, the FIU has signed Memoranda of Understanding for cooperation with 48 foreign authorities and added the U.S. Financial Crime Enforcement Network (FINCEN) into its global network on June 20. For further information on money laundering and financial crimes, we refer you to the 2013 International Narcotics Control Strategy Report (INCSR), Volume 2, Money Laundering and Financial Crimes: //2009-2017.state.gov/j/inl/rls/nrcrpt/2013/vol2/index.htm

Regional and International Cooperation: South Korea is a member of the UN, APEC, ASEAN+3, East Asia Summit, Asia-Europe Meeting, Asia Cooperation Dialogue, Forum for East Asia-Latin America Cooperation, OECD, G-20, and the Conference on Interaction and Confidence-Building Measures in Asia. It is also a partner country of the OSCE and NATO.

On March 26-27, the Republic of Korea hosted the 2012 Nuclear Security Summit in Seoul; combating nuclear terrorism was a significant conference component. In September in Seoul, the South Korean government hosted the ASEAN Regional Forum (ARF) Seminar on Confidence Building Measures in Cyberspace, under the endorsement of the ARF Counter-Terrorism and Transnational Crime Inter-Sessional Meeting.

The Republic of Korea government continued to help developing countries build law enforcement capacities through bilateral and regional channels such as the ASEAN+3 Ministerial Meetings on Transnational Crimes. In 2012, the Republic of Korean Government organized 21 training courses covering topics such as forensic science investigation, crime prevention, and cyber crime investigation, and invited 342 government officers from developing countries to participate.

In 2012, the Korean Government held bilateral consultations on counterterrorism with Japan, China, Russia, Brazil, Mexico, and India.

In February, the Korean National Police Agency partnered with the International Tactical Officers Training Association to co-host the 2012 Evolution Counterterrorism Conference, with a dual theme of “Command and Leadership” and “Counterterrorism Operations.”

Overview: Malaysia's counterterrorism cooperation with the United States has continued to improve in recent years, and it was an important counterterrorism partner in 2012. Malaysia has not suffered a serious incident of terrorism for several years, but was vulnerable to terrorist activity and continued to be used as a transit and planning site for terrorists. Weak border controls persisted in the area contiguous with Thailand in northern Malaysia, and there were gaps in maritime security in the tri-border area of the southern Philippines, Indonesia, and the Malaysian state of Sabah. The repeal of the decades-old Internal Security Act and its replacement by the new Security Offenses (Special Measures) Act, along with several amendments to existing laws, moved Malaysia’s counterterrorism approach away from detention without trial to a criminal prosecution-based system. The Royal Malaysia Police (RMP) cooperated closely with the international community on counterterrorism efforts, and RMP and other law enforcement officers participated in capacity building training programs.

Legislation, Law Enforcement, and Border Security: In April, the parliament repealed Malaysia’s Internal Security Act (ISA), under which Malaysia had for decades routinely detained suspected terrorists without formal judicial proceedings for renewable two-year terms. Three separate declarations of emergency were also repealed on November 24, 2011, which led to the expiration of the Emergency Ordinance in May 2012. In place of the ISA, the parliament passed the Security Offenses (Special Measures) Act (SOSMA) which took effect on July 31, along with amendments to the Penal Code, Criminal Procedure Code, and Evidence Act. Under the SOSMA, once an arrest has been made, the next-of-kin must be notified immediately and the accused must have access to a lawyer within 24 hours. A high-ranking police officer can extend the detention period to 28 days, at which time the accused must be charged or released. The law also states that a person cannot be charged for his political beliefs or activities. The repeal of the decades-old ISA and its replacement by the SOSMA, along with several amendments to existing laws, was a positive development, moving Malaysia’s counterterrorism approach toward a criminal prosecution-based system.

There were no reported arrests under the ISA in 2012. In October, Lebanon arrested two Malaysians believed to be suicide bombers with suspected al-Qa’ida links. In February, Malaysian police detained Iranian Masoud Sedaghatzadeh, who had allegedly fled to Malaysia from Thailand after a group of Iranians in Bangkok accidentally detonated bombs allegedly intended to target Israeli interests. Sedaghatzadeh was captured when he attempted to depart Malaysia for Iran from the Kuala Lumpur International Airport. A Malaysian court ordered his extradition to Thailand but Sedaghatzadeh reportedly was appealing the order; at year’s end he remained in Malaysian custody pending appeal.

Malaysia has very liberal visa requirements generally, and does not require an entry visa for citizens of many countries. As part of its visa and immigration controls, Malaysia continued to implement a biometrics system introduced in June 2011 that records the fingerprints of the right and left hand index fingers at all ports of entry. The National Foreigners Enforcement and Registration System reportedly was linked to the police's existing Biometric Fingerprint Identification System. The system has had problems, but the police reported that the new biometric system was successful overall. The country also continued an effort to register foreign workers, many of whom were undocumented, and to regularize their status or facilitate their return to their countries of origin. The effort involved the biometric registration of over two million foreign workers and undocumented immigrants.

Malaysia continued to participate in the Department of State’s Antiterrorism Assistance program. The program began to transition in 2012 from its focus on cyber investigations and cyber security to a focus on border security. Installation of the eighth and final maritime surveillance radar was completed in 2012. Located on the northeastern coast of Sabah, these radars provided additional maritime domain awareness capability for the Malaysian Joint Forces Command. At Malaysian government request, the United States conducted a three-day counterterrorism workshop for Malaysian police and prosecutors entitled “Preventing Acts of Terrorism Through Proactive Policing and Prosecution,” which focused on best practices for investigating and successfully prosecuting conspiracy and material support cases under Malaysia’s new law.

Countering Terrorist Finance: Malaysia is a member of the Asia/Pacific Group on Money Laundering, a Financial Action Task Force-style regional body. Malaysia’s Money Service Business Act of 2011 (MSBA), which took effect on December 1, 2011, was used for prosecution for the first time on August 10 when a company was charged with operating as a money-changer without a license. The MSBA represents an improved legislative framework that criminalized terrorist financing and strengthened the safeguards of the money services industry (the remittance, money-changing, and wholesale currencies businesses) against abuses. Compliance with the MSBA is monitored closely by Bank Negara Malaysia. Malaysia did not prosecute any counterterrorist finance crimes in 2012.

In September, Malaysia’s Compliance Officers' Networking Group organized the fourth International Conference on Financial Crime and Terrorist Financing, a two-day event. The event was attended by more than 300 people, including speakers from the U.S. Department of Treasury, the U.S. Department of State, Homeland Security Investigations, and the FBI. For further information on money laundering and financial crimes, we refer you to the 2013 International Narcotics Control Strategy Report (INCSR), Volume 2, Money Laundering and Financial Crimes:  //2009-2017.state.gov/j/inl/rls/nrcrpt/2013/vol2/index.htm

Regional and International Cooperation: Malaysia actively participated in ASEAN and the APEC forum. Malaysian law enforcement officials routinely met with regional counterparts to discuss counterterrorism issues at meetings such as the Heads of Asian Coast Guard Agencies Meeting in New Delhi in October, and the ASEAN Senior Officials Meeting on Transnational Crime in Bangkok in September. The Malaysian Maritime Enforcement Agency hosted boarding officer training and a Maritime Law Enforcement Commanders’ Forum, funded by the Department of State’s Export Control and Related Border Security program, to improve maritime law enforcement collaboration among Gulf of Thailand littoral nations.

Malaysia’s Southeast Asia Regional Center for Counterterrorism (SEARCCT) hosted five seminars and training events with regional participation, including: a three-day Sub-Regional Seminar on International Joint Investigations for Southeast Asian States jointly organized by SEARCCT and the UN Counter-Terrorism Committee Executive Directorate with support from the government of New Zealand; a five-day Regional Aviation Security Seminar in collaboration with the New Zealand and U.K. High Commissions; and a four-day seminar on “The Dynamics of Youth and Terrorism,” attended by 39 participants.

Countering Radicalization and Violent Extremism: Malaysia facilitated talks between the Philippine Government and the Moro Islamic Liberation Front that resulted in the October signing of a historic peace framework agreement, an effort which some Malaysian officials have said was partly intended to reduce the potential for radicalization in a region of the Philippines that borders Malaysia.

The RMP and the Department of Islamic Development operated a disengagement program for terrorist suspects who were held under the ISA in Malaysia’s Kamunting Prison. The program involved religious and social counseling and vocational training. It employed psychologists, religious scholars, police officers, and family members. A committee evaluated detainees' progress toward eligibility for release from prison. The committee’s reports were reviewed by a panel from the detention center and also by the Home Ministry. Upon release, former inmates were visited by parole officers and continued to face restrictions on their activities, including curfews and limits on their travel and contacts. While the government portrayed the disengagement program as highly successful, it lacked demonstrable metrics for its effectiveness. As this program was directed primarily at ISA detainees, it was unclear what will become of the program in the wake of the ISA’s mid-2012 repeal.

Overview: The Philippines maintained its strong counterterrorism cooperation with the United States. The ability of terrorist groups, including the Abu Sayyaf Group (ASG), Jemaah Islamiya (JI), and the Communist People’s Party/New People’s Army (CPP/NPA), to conduct terrorist activities inside the Philippines remained constrained. Terrorist groups’ acts were generally limited to criminal activities designed to generate revenue for self-sustainment, such as kidnapping for ransom or extortion. Nonetheless, members of these groups were suspected to have carried out bombings against government, public, and private facilities, primarily in the central and western areas of Mindanao; others were linked to extortion operations in other parts of the country.

The Government of the Philippines continued to implement its 2011–2016 Internal Peace and Security Plan that calls for the transition of internal security functions from the Armed Forces of the Philippines (AFP) to the Philippine National Police (PNP). The increasing role of the police in maintaining internal security in conflict-affected areas will permit the AFP to shift its focus to enhancing the country's maritime security and territorial defense capabilities.

On October 15, the peace panels of the government and the Moro Islamic Liberation Front signed the Framework Agreement on the Bangsamoro, which lays out a roadmap to a comprehensive peace agreement and calls for the creation of the Bangsamoro entity to replace the Autonomous Region in Muslim Mindanao. A comprehensive peace agreement has the potential to improve peace and security in Mindanao.

2012 Terrorist Incidents: High-profile terrorist incidents included:

• On May 31, an improvised explosive device (IED) detonated in front of the residence of Isabela City Mayor Santos-Akbar, wounding two civilians.

• On July 26, nine soldiers were killed and 12 wounded when the AFP clashed with militants in Sumisip on the island of Basilan. Five militants were reportedly killed in the incident.

• On August 16, a bomb destroyed a city bus in Zamboanga City, injuring at least seven. A second bomb exploded an hour later in front of a nearby mosque. No one was injured in the second blast.

• On September 1, 48 civilians were injured when a grenade exploded during a village fiesta in Paquibato District outside of Davao City. The NPA later issued an apology for the attack, claiming the grenade was thrown at an AFP detachment but bounced off some netting and landed inside an adjacent basketball gym where a circus was being held.

• On October 11, an IED exploded near the entrance of Maxandrea Hotel in downtown Cagayan de Oro City, killing two civilians after police arrived to investigate suspicious activity reported in the area. A second IED was found in a street adjacent to the hotel, but was safely detonated.

Legislation, Law Enforcement, and Border Security: The Philippines coordinated with U.S. law enforcement authorities, especially regarding U.S. fugitives and suspected terrorists. An under-resourced and understaffed law enforcement and justice system coupled with widespread official corruption, however, resulted in limited domestic investigations, unexecuted arrest warrants, few prosecutions, and lengthy trials of cases.

A petition filed in 2010 by the Philippine Department of Justice with the Regional Trial Court in Basilan for the proscription of the ASG as a terrorist group and 202 identified associates as terrorists, was pending action at year’s end.

• On February 2, the AFP launched an operation on Jolo Island that reportedly killed ASG commander Umbra Jumdail (aka Dr. Abu) and 14 other ASG members.

• On May 23, Philippine National Police Officer Arnold Mayo was charged with murder. Witnesses reportedly identified him as planting a bomb that exploded inside a commuter bus on a major highway in Makati City and killed five passengers in January 2011.

• On June 21, Alawie Pasihul was arrested in Zamboanga City on suspicion of being part of an ASG group that kidnapped American citizens Martin and Gracia Burnham and Guillermo Sobero in May 2001. (Fourteen other ASG members were convicted in 2007 and sentenced to life imprisonment for their participation in the kidnapping that resulted in the deaths of Sobero, Martin Burnham, and Philippine nurse Ediborah Yap.)

• In September, due to a technical issue, a regional trial court in Manila dismissed the extradition case against an ASG leader wanted in the United States to stand trial on criminal hostage-taking charges in the 1993 kidnapping of U.S. national Charles Walton.

• On December 14, Mohammad Noor Fikrie bin Abdul Kahar, a suspected Malaysian JI member, was killed in Davao by police after he threatened to detonate an explosive device in his backpack.

The Philippines continued to improve the security of its passports. Beginning in 2007, the Philippines started to issue machine readable passports. Three million such passports remained in circulation at year’s end, the last of which will expire in 2013. In August 2009, the Philippines started to produce "e-passports" containing a biometric chip. Six million Philippine passports in circulation are e-passports, accounting for 65 percent of all valid passports, according to the Philippines Passport Office.

The Philippines remained an important partner nation in the Department of State’s Antiterrorism Assistance program, which provided tactical and investigative training to support the transition in the southern Philippines from military to civilian counterterrorism authority.

Countering Terrorist Finance: The Philippines is a member of the Asia/Pacific Group on Money Laundering (APG), a Financial Action Task Force (FATF)-style regional body. Republic Act No. 10168, the Terrorism Financing Prevention and Suppression Act of 2012, was signed into law June 18 and took effect July 5. The law made terrorist financing a stand-alone crime in line with APG/FATF recommendations and specifically authorizes the Anti-Money Laundering Council to issue an ex parte order to freeze without delay property/funds related to the financing of terrorism or acts of terrorism, including the property/funds of individuals and entities on the UNSCs 1267/1989 and 1988 consolidated lists.

Republic Act No. 10167, which amended the Anti-Money Laundering Act of 2001, was signed into law June 18 and took effect July 6. It allows the Anti-Money Laundering Council to inquire into bank accounts based on an ex parte application, without the depositor’s knowledge for a limited period of time, and allows additional courts other than the Court of Appeals to issue asset freeze orders.

There is no single supervisory authority responsible for entities in the nonprofit sector; coordination is insufficient. Monitoring is weak due to insufficient coordination and resources of nonprofit organization regulatory bodies.

For further information on money laundering and financial crimes, we refer you to the 2013 International Narcotics Control Strategy Report (INCSR), Volume 2, Money Laundering and Financial Crimes: //2009-2017.state.gov/j/inl/rls/nrcrpt/2013/vol2/index.htm

Regional and International Cooperation: The Philippines participated in the ASEAN Defense Ministers’ Meeting Plus (ADMM-Plus) and supported the ADMM-Plus Experts’ Working Group on Counterterrorism that met in Washington in April. Through U.S.-sponsored counterterrorism training, the PNP developed contacts with law enforcement agencies in Indonesia and Malaysia.

Countering Radicalization and Violent Extremism: The Philippine Government continued its counter-radicalization program: Payapa at Masaganang Pamayanan or PAMANA (Resilient Communities in Conflict Affected Communities). In November, the Philippines hosted the second meeting of the Global Counterterrorism Forum Southeast Asia Working Group, which focused on youth radicalization. Experts from around the region and world gathered to share best practices and experiences in countering youth radicalization.

Overview: In 2012, Singapore’s bilateral and multilateral engagement on counterterrorism intelligence and law enforcement cooperation was inconsistent and marked by a transactional mindset that impeded the development of broad, deep, and predictable agency-to-agency relationships. While some agencies have had success from time to time, Singapore appeared to provide selective cooperation dependent upon the issue.

As of December, Singapore had detained 16 terrorist suspects. Detainees included members of Jemaah Islamiya (JI), who had plotted to carry out attacks in Singapore in the past, and members of the Moro Islamic Liberation Front. Two persons with links to terrorist groups were newly detained in 2012. In 2012, Singapore released 23 persons on Restriction Orders (RO) and one on Suspension Direction (SD). Detainees released on ROs and SDs were monitored by the Singapore authorities and required to report to authorities on a regular basis.

Legislation, Law Enforcement, and Border Security: Singapore used its Internal Security Act (ISA) to arrest and detain suspected terrorists without trial. The ISA authorizes the Minister for Home Affairs (MHA), with the consent of the president, to order detention without judicial review if it is determined that a person poses a threat to national security. The initial detention may be for up to two years, and the MHA may renew the detention for an unlimited number of additional periods up to two years at a time with the president’s consent.

Singapore’s 2012 law enforcement actions included:

• In February, Singapore released a member of JI, Jumari bin Kamdi, who was detained under the ISA in January 2011. According to an MHA press release, he was cooperative with investigators, and it was assessed that he no longer posed a security threat that required further detention.

• In February, Singapore detained JI member Abd Rahim Abdul Rahman. He attended terrorist training in Afghanistan with al-Qa’ida (AQ) in 1999 and 2000. Rahman was arrested in Malaysia in February 2012 and deported to Singapore.

• In May, Singapore detained JI member Husaini Ismail. He was arrested in Indonesia in June 2009 for immigration violations and deported to Singapore after his release in May. He attended terrorist training in Afghanistan with AQ in 1999 and 2000. According to the MHA, both he and Rahman were actively involved in reconnoitering several potential local and foreign targets in Singapore for the purpose of a terrorist attack.

Countering Terrorist Finance: Singapore is a member of the Financial Action Task Force (FATF) and the Asia/Pacific Group on Money Laundering, a FATF-style regional body. There were no assets frozen or confiscated for terrorist finance-related crimes. For further information on money laundering and financial crimes we refer you to the 2013 International Narcotics Control Strategy Report (INCSR), Volume 2, Money Laundering and Financial Crimes: //2009-2017.state.gov/j/inl/rls/nrcrpt/2013/vol2/index.htm

Regional and International Cooperation: In August, the Republic of Singapore Navy participated in the annual Southeast Asia Cooperation Against Terrorism exercise, together with the U.S. Navy and the navies of Brunei, Indonesia, the Philippines, and Thailand. Singapore was an active participant in ASEAN and is a member of the Proliferation Security Initiative.

Countering Radicalization and Violent Extremism: Singapore maintained a de-radicalization program that focused on countering detainees' extremist ideology. Singapore enlists the support of religious teachers and scholars to study JI's ideology, develops teachings to counter the group's spread within Singapore's Muslim community, and provides counseling to detainees. Religious counseling for detainees continues after release. Among those individuals released from detention, there were no reported cases of recidivism.

Overview: Counterterrorism cooperation with Thailand remained strong. Thailand engaged with the United States on investigations into Hizballah and Iranian activities after incidents involving both occurred in January and February. On January 12, Thai police detained a Hizballah operative on immigration charges as he was attempting to depart Thailand from Suvarnabhumi International Airport. He led police to nearly 10,000 pounds of urea-based fertilizer and 10 gallons of liquid ammonium nitrate in a commercial building about 20 miles south of Bangkok. It was unclear if the materials were intended to be used to carry out terrorist attacks in Thailand – possibly against Israeli tourists – or if they were to be transported to another country. The Hizballah operative was awaiting trial at year’s end.

On February 14, Thai police arrested two Iranian men after they accidentally set off explosives that were allegedly intended to target Israeli diplomats. A third Iranian was arrested in Malaysia and was awaiting extradition to Thailand at year’s end. Two other Iranians successfully fled Thailand. All the operatives traveled in and out of Bangkok through Malaysia; two of them may have traveled from Malaysia to Thailand through the land border at least once. The bombs were similar to bombs targeting Israeli diplomats in Georgia and India during that same week.

There was no direct evidence of operational linkages between the southern Thai insurgent groups and international terrorist networks.

Legislation, Law Enforcement, and Border Security: The porous nature of Thailand’s southern border with Malaysia remained an issue of concern. At the same time, cross-border law enforcement cooperation, based on long association between Thai and Malaysian police officers, remained strong. With support from the United States, Thailand continued to use the Personal Identification Secure Comparison and Evaluation System (PISCES) border security system at five airports and four land border stations until June. In June, the Thai government replaced PISCES with the Personal Identification and Blacklist Immigration Control System (PIBICS) – an information capture and query system designed for the Thai Immigration Bureau – at eight points of entry, except Suvarnabhumi International Airport in Bangkok, for a three month trial evaluation. Thailand continued to participate in the Department of State’s Antiterrorism Assistance program.

Countering Terrorist Finance: Thailand is a member of the Asia/Pacific Group on Money Laundering, a Financial Action Task Force (FATF)-style regional body. Thailand’s 2010-2015 National Strategy for Combating Money Laundering and the Financing of Terrorism was developed by the Anti-Money Laundering Office (AMLO), Thailand’s official Financial Intelligence Unit. The strategy called for the legislative enactment of key counterterrorist finance measures by October 31, 2012; however, widespread flooding and political transitions delayed the passage of legislation.

In 2010, the Thai Government expressed high-level political commitment to addressing deficiencies that the FATF identified in Thailand’s anti-money laundering/combating the financing of terrorism regime, and reported taking multiple steps to address FATF recommendations. Thailand’s failure to pass the amended Anti-Money Laundering Act and the draft bill of Anti-Financing of Terrorist prompted the FATF, in February 2012, to downgrade Thailand to its ‘blacklist’ of countries, raising concern about financial transactions in Thailand. Since then, Thailand has passed the legislation and will be considered by the FATF for removal from the blacklist from its enhanced monitoring process in June 2013, pending a successful completion of the on-site visit.

The AMLO’s 2010-2015 National Strategy for Combating Money Laundering and the Financing of Terrorism specifically calls for enhanced measures to provide for greater transparency and oversight of nonprofit organizations by December 2014. More specifically, the 2010-2015 National Strategy calls for implementation of appropriate licensing procedures, supervision, monitoring, and oversight in line with international standards. This includes ensuring that information on the operations of each nonprofit organization is publicly available. The Bank of Thailand does not have regulations that give it explicit authorization to control charitable donations; however, the Financial Institutions Business Act and the Electronic Payment Services Business Decree require all financial institutions and non-bank service providers to adopt both know-your-customer rules and customer due diligence procedures for all clients, and must meet the Anti-Money Laundering Act’s reporting requirements, which would include transactions deriving from charitable donations.

For further information on money laundering and financial crimes, we refer you to the 2013 International Narcotics Control Strategy Report (INCSR), Volume 2, Money Laundering and Financial Crimes: //2009-2017.state.gov/j/inl/rls/nrcrpt/2013/vol2/index.htm

Regional and International Cooperation: Thailand participated in international counterterrorism efforts, including through APEC, ASEAN, the ASEAN Regional Forum, the Asia-Europe Meeting, and the Bay of Bengal Initiative for Multi-Sectoral, Technical, and Economic Cooperation. Thailand, along with the U.S. Pacific Command, co-hosted 11 countries for the annual Pacific Area Security Sector Working Group.

Countering Radicalization and Violent Extremism: A range of Thai Government agencies, including the Southern Border Provincial Administration Center and the Internal Security Operations Command, continued to organize outreach programs to ethnic Malay-Muslims to counter radicalization and violent extremism. A small group of international NGOs also reached out to communities in the southern provinces to provide services and to identify the underlying causes of the area’s violence.