Cablegate: Reply to Elint-Related Blue Lantern 050179563

VZCZCXYZ0004
RR RUEHWEB

DE RUEHMD #0998/01 2861452
ZNR UUUUU ZZH (CCY ADC38B84 MSI5075-695)
R 131452Z OCT 09
FM AMEMBASSY MADRID
TO SECSTATE WASHDC 1320

UNCLAS MADRID 000998

SENSITIVE
SIPDIS

C O R R E C T E D COPY CAPTION
PM/DTCC - BLUE LANTERN COORDINATOR
FOR PETER SABATINI, PM/DTCC
FOR STACIE ZERDECKI, EUR/WE

E.O. 12958: N/A
TAGS: ETTC KOMC SP
SUBJECT: REPLY TO ELINT-RELATED BLUE LANTERN 050179563
(UNFAVORABLE) AND 050141626 (FAVORABLE)

REF: A. STATE 81475
B. 9/01/09 MURRAY-SABATINI E-MAILS
C. 9/08/09 CEBALLOS LETTER AND ATTACHMENT
D. MADRID 908
E. STATE 96274
F. MADRID 777
G. MADRID 453

1. (SBU) Amid heightened suspicion of wrong-doing, including
unauthorized storage of night vision devices and
falsification of orders by Spanish defense distributor Elint
S.A. (refs D, F, G), Post enjoyed the full cooperation of
Spanish Ministry of Defense contacts in investigating two
unrelated Elint orders for battlefield effects simulators
(ref A). Both cases involved significant quantities of paint
balls, rechargeable batteries, landmine trainers, and other
items intended for the end use of the Spanish Army in
preparing soldiers to recognize improvised explosive devices
and other threats. No DSP-83 end-use certificates were
submitted for either license, nor did PM/DTCC have any
documentation signed by GOS entities (ref B). MOD
Directorate General of Armament and Materiel (DGAM)
Subdirector General for International Relations BG Jose Luis
Ceballos Porras, who met with Pol-Mil officer and ODC chief
September 3 regarding these cases and the ongoing
investigation of Elint, confirmed only one of the orders for
simulation supplies and refutes the second, much
higher-valued order.

----------------------------------------
Post-Shipment Check on License 050141626
----------------------------------------

2. (SBU) Post can confirm the specific types and value of
commodities ordered and will forward Spanish Army
documentation of what appears to be a legitimate order.
Regarding reftel A request to verify the Spanish Army's
purchase and receipt of USD $8,748.00 worth of
non-pyrotechnic battlefield effects simulators for the
training of Spanish soldiers in recognition of IEDs, suicide
bombers, and booby traps, Spanish MOD advised the order was
within the realm of the possible because up to USD $90,000
had been authorized for such purchases, and DGAM would
compare line items to confirm. Spanish MOD provided Post on
September 8 documentation verifying the purchase of Euros
6,245.98 worth of simulation and training products from
Combat Training Solutions via foreign consignee Elint. The
DGAM dual-use transfer license signed January 19 includes an
inventory of products in Spanish that correlates down to
exact part numbers with the product list (ref A) of items
exported by Combat Training Solutions on January 29.

--------------------------------------------- -----
Pre-License End-Use Check on Application 050179563
--------------------------------------------- -----

3. (SBU) However, Spanish MOD contacts questioned from the
beginning the veracity of a subsequent purchase order for USD
$15,276,600.00 worth of battlefield effects simulators (ref
A) and held that no Spanish military entity would have been
authorized to order such materials in such quantities in
light of current budget constraints. PM/DTCC noted September
1 that the Elint purchase order was of exceptionally bad copy
quality and difficult to read due to small print (ref B).
Neither this license application nor the previous shipment,
subsequently confirmed, had any documentation signed by the
Spanish Army or any other GOS official. Based on assertions
made September 3 by Ceballos and the lack of GOS documentary
support, PM/DTCC returned license application 050179563
without action (RWA). In his letter dated September 8,
Ceballos reiterated that the Army's initial response denied
existence of the order.

4. (SBU) Subsequent to the RWA notification, beginning
September 14, Elint Product Manager Carlos Dominguez
nonetheless placed numerous calls to Madrid ODC inquiring
about the administrative hold. Elint also lobbied Combat
Training Solutions, a company representative of which
contacted the U.S. Commercial Service via the Denver office
for assistance. Dominguez maintained that the Spanish Army
needed the battlefields effects simulators urgently and asked
who he might contact to break what he perceived to be a
bureaucratic logjam. The Spanish MOD subsequently received a
written response the week of October 5 from the Spanish Army
stating that the Army did not/not order the material
referenced in the MOD's query based on our request (ref A).
As of October 7, General Ceballos planned to notify ODC Chief
in writing of the result of their investigation.

---------------------------------
Continuing Investigation of Elint
---------------------------------

5. (SBU) Elint was placed under a Policy of Denial by the
United States on September 24, in close coordination with
Spain's DGAM, which has likewise instructed the Spanish
services to refrain from using Elint. Spanish MOD and
Spanish National Police contacts investigating Elint's prior
offenses await original documentation requested by PM/DTCC of
N-Vision Optics LLC o/a September 23 in order to take legal
action against Elint.
CHACON

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