SEST-593 National Security and the International Financial System

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Until recently, national security was regarded as the province of foreign ministries, defense ministries and intelligence services. One of the developments in recent years in international security policy throughout the world is the increasing role played by finance ministries. Since September 11, there has been a rapid expansion in the international community’s willingness and ability to use the international financial system as a pressure point to address a wide range of international security concerns from terrorism to WMD proliferation to rogue regimes. In fact, in the past few years, virtually every UN Security Council Resolution passed has included financial measures (e.g. UNSCRs related to terrorism, Iran, North Korea, the Hariri Assassination and Liberia, to name a few). The U.S. has become increasingly sophisticated in its ability to use financial tools, both unilaterally and multilaterally, to disrupt the support networks of terrorists, organized criminals, and WMD proliferators, and to apply pressure on regimes such as Iran and North Korea. The important role the U.S. Treasury Department has played in the Iran and North Korea WMD issues would have been inconceivable just a few years ago.

This course will first examine the history of U.S. and international efforts to work through the international financial system to address law enforcement and national security issues. It will then examine how those efforts were transformed after September 11 to deprive bad actors of access to the international financial system and to use that system to achieve specific international security outcomes. The course will examine relevant primary international instruments such as the UN Narcotics Convention, the UN Convention for the Suppression of Financing of Terrorism, the UN Convention on Transnational Organized Crime and an array of UNSCRs. Particular focus also will be paid to the work of the Financial Action Task Force (FATF), the premier international body which sets and seeks to ensure global compliance with AML/CFT standards. Issues related to FATF also will tie in to other international institutions like the IMF, the World Bank and FATF-Style Regional Bodies (FSRBs). Finally, the course will examine U.S. financial tools such as those available in the International Emergency Economic Powers Act (IEEPA), the Bank Secrecy Act and the USA PATRIOT Act, and how those tools have been applied in instances such as Iran, North Korea, and more generally to the War on Terrorism.

This course will discuss important policy debates, both domestically and internationally, regarding the important role of the international financial system as well as policy discussions regarding the appropriate use of financial measures and other tools. This course is a seminar, structured to teach students practical skills necessary to contribute as active players in the dynamic policy environment of the U.S. government. Class meetings will be driven by student participation and will simulate interagency coordination processes in reaching national policy decisions and/or in assessing threats to U.S. interests. Guests will include U.S. government officials who will speak on the nature and origins of U.S. policy regarding national security and the international financial system.

Credits: 3

Prerequisites: None

Other academic years
There is information about this course number in other academic years:

• 2007-2008 Fall and Spring
• 2008-2009 Fall and Spring
• 2010-2011 Fall and Spring
• 2011-2012 Fall and Spring
• 2012-2013 Fall and Spring
• 2013-2014 Fall and Spring

More information
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