Treasury's War by Juan Zarate

Author:Juan Zarate [Zarate, Juan C.]
Language: eng
Format: epub
ISBN: 9781610391160
Publisher: PublicAffairs

When the press conference ended, Glaser was dispatched to see his counterparts in the Chinese government before going home. He sat down with officials in the Chinese central bank and finance ministry—to receive a scolding. The Chinese finance officials demanded to know why US negotiators were now attempting to unwind the BDA action. They saw this as a moment to insulate the Chinese banking system from North Korea’s illicit financial activity. They could not understand why the United States, which had rightly argued for the protection of the international financial system and the isolation of BDA, would now try to convince Chinese banks to help BDA and the North Koreans with unsavory bank transfers.

As Glaser would note later, “It was one of the most embarrassing meetings I’ve ever endured, but it was also one of my proudest moments. While I was being scolded and lectured, I was thinking to myself, ‘Good for you guys.’” The Chinese were graduating into the legitimate financial world, and their disparagement of the US Treasury officials was a signal that they would not allow their financial system to be toyed with for political reasons—by Beijing or Washington.

Glaser knew the saga was not over. Almost as soon as he landed in Washington, he received a call from Secretary Paulson. The Chinese central bank had put a stop to the deal, and there would be no Chinese bank involvement in the transfer of the frozen North Korean assets. President Bush was pressing and had asked Paulson, “Where is your team?” Paulson had said authoritatively, “They’re on the plane.” After the call, Paulson called Glaser and ordered, “Get on the plane!” Paulson insisted that the Treasury team needed to be on the next flight to Beijing regardless of whether they had visas. Meiners got a call too. Paulson was aware that Meiners had scheduled time to go wedding-dress shopping with her mother, who was flying into town that week. When he called her directly, he apologized for the imposition and thanked her for her work on behalf of the department and country. He underscored the historic nature of this work, as Meiners cried quietly on the other end of the line and prepared to travel again.

The delegation was back in Beijing within seventy-two hours of having returned to Washington. This time, Paulson sent along his chief of staff, James R. Wilkinson, a veteran of the State Department who was trusted by Secretary Rice and known to Chris Hill. Wilkinson was there to keep the State Department honest and to be the eyes and ears of the secretary of the treasury.

The frustrating negotiations with the North Koreans resumed once again. Wilkinson dealt on a daily basis with his North Korean counterpart, a man with gold front teeth who was named Mr. Chang. But the Treasury delegation was constrained in what it could offer. As a banking regulator itself, the Treasury did not want to be seen negotiating a deal for the transfer of the frozen assets. Furthermore, the Treasury

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