O'Neill praises efforts of U.S. allies to freeze funds of terrorist groups

By JEANNINE AVERSA
Associated Press Writer

WASHINGTON – Treasury Secretary Paul O'Neill said Friday the Bush administration is pleased with the level of cooperation it is receiving from other nations in its drive to choke off money going to terrorist organizations.

O'Neill, briefing reporters before a Saturday meeting of finance ministers and central bank presidents from the world's seven richest industrial countries, said the United States is having major success building "an international coalition to disrupt terrorist fund raising."

Meanwhile, U.S. government sources, speaking on condition of anonymity, said the administration is preparing to freeze the assets of two dozen more people and organizations with suspected links to terrorism.

The Treasury Department is working on a list that could double the number of individuals and groups being targeted in the campaign to cut off money to terrorists, the sources said.

These officials said the new list could contain between 24 and 27 entities. The list is expected to be sent over the weekend to the White House, which can make changes to it. The new list is expected to be released early next week.

Meantime, the State Department on Friday issued its biennial report listing terrorist organizations with which Americans are prohibited from dealing. The list of two dozen is little changed from 1999, and includes Osama bin Laden and his al-Qaida network.

The Treasury Department action would follow up on a Sept. 24 executive order by President Bush that ordered a freeze on the assets of 27 people and organizations suspected of conducting or financing terrorist activities, including Saudi exile bin Laden.

The U.S. government considers bin Laden the prime suspect in the Sept. 11 attacks against the World Trade Center and the Pentagon.

The old list named 12 individuals, including bin Laden and an Egyptian militant suspected to be his top deputy; 11 organizations, including bin Laden's al-Qaida network; three charities; and one business.

On Monday President Bush said some $6 million has been blocked in the United States and other countries since he issued his order.

At his Friday briefing, O'Neill said the process of identifying assets that should be frozen is continuing but he refused to give an updated figure on the amount.

"We are continuing to identify and gain agreement among all the necessary parties on the names and organizations that should be added to the list," O'Neill said. "This is going to be a rolling process. I suppose we should occasionally give you an update. But I don't have an update for you today."

O'Neill said the United States stands ready to provide technical assistance to help other nations set up systems that would identify suspicious transactions and accounts.

"We have had complete cooperation from our G-7 partners and from all corners of the world," O'Neill said.

O'Neill and Federal Reserve Chairman Alan Greenspan will be the hosts on Saturday for discussions at the Treasury Department with their counterparts from Japan, Germany, France, Britain, Italy and Canada. Increased efforts to track down terrorist money and coordinated efforts to boost global economic growth will be the top items on the agenda.

On the global economy, O'Neill said the discussions would center on ways to reinvigorate growth. Many economists believe the Sept. 11 terrorist attacks have pushed the United States into a recession. O'Neill insisted that because of strong fundamentals, the U.S. economy would quickly bounce back.

"The attacks of Sept. 11 were a shock to our economy, abruptly halting activity in many sectors, which will almost certainly result in a negative growth rate in the third quarter and a delayed recovery in the United States by a quarter or so," O'Neill said.

Administration officials have stressed that the combination of interest rate cuts by the Federal Reserve, more tax relief and spending of around $100 billion, which the administration is discussing with Congress, will be enough to ensure a rebound by early next year.

APNP-10-05-01 1109CDT