U.S. Department of State Country Reports on Terrorism 2005 - Paraguay

Although Paraguay is cooperative in counterterrorism and law enforcement efforts, its judicial system remains severely hampered by a lack of strong anti-money laundering and counterterrorism legislation. In 2004, the Government of Paraguay submitted a bill to the legislature to strengthen its anti-money laundering regime, but the draft legislation remained stalled. The government has not yet introduced draft counterterrorism legislation. Both are essential to Paraguay meeting its international counterterrorism obligations under UN Security Council resolutions.

Lacking effective counterterrorism legislation, Paraguay had to prosecute suspected terrorist financiers under tax evasion or other statutes. Paraguayan authorities prosecuted Kassem Hijazi, a suspected Hizballah money launderer connected to 113 businesses and 46 individuals. Hijazi remains free on bail pending a preliminary trial hearing. In addition, officials filed charges against suspected terrorist fundraiser Hattem Barakat for tax evasion and passport and document forgery. Separately, Paraguayan authorities are seeking the arrest of fugitive Hassan Ali Barakat (Barakat's cousin), for conspiracy, piracy, and contempt of court.

Paraguay was shocked by the discovery in March of the murder of former President Raul Cubas' daughter Cecilia, who was kidnapped in 2004. Paraguayan authorities aggressively prosecuted members of the leftist Free Fatherland Party (Partido Patria Libre, or PPL) and revealed that the perpetrators had sought and received advice on the kidnapping from a member of the Revolutionary Armed Forces of Colombia (FARC). In October, a Paraguayan judge indicted 25 individuals, and PPL faction leader Osmar Martinez repeated earlier admissions of ties with the FARC.

The United States assisted Paraguay with both antiterrorism training and national security strategic planning.