Testimony of Brad Brooks-Rubin: The Questionable Case for Easing Sudan Sanctions

Chairman Smith, Ranking Member Bass, Members of the Subcommittee, thank you for holding this important hearing and providing The Enough Project and our financial investigative initiative, The Sentry, with the opportunity to share our perspective on a country that has long vexed U.S. policymakers. Congress has a deep and bipartisan history of leading U.S. efforts to promote peace, human rights, religious freedom, and counterterrorism objectives in Sudan, and this is an absolutely critical moment for Congress to continue that engagement.

It is a critical moment because, this past January, in the waning moments of the last Administration, an all-or-nothing choice on economic sanctions on Sudan—either maintain the two decades-old comprehensive sanctions or lift them entirely—was created. This false choice came out of a limited, five-track engagement process that was developed in mid-2016. This process is insufficient because it does not address basic governance issues in Sudan, it does not include crucial human rights and religious freedom issues, and it removes the bulk of U.S. leverage without requiring any peace agreement for the multiple wars being waged today in Sudan. The far more sophisticated tools of financial pressure that are available today can be deployed in a much more nuanced way than a “sanctions on all of Sudan” or a “no sanctions at all” approach.

We believe Congress and the Trump Administration must correct this course—now. This correction can best be achieved by developing a de-linked and independent Human Rights and Peace Track with the Government of Sudan that would supplement but remain independent of the five-track engagement process. This diplomatic track should address the most critical reform issues in Sudan, and it should be tied directly to modernized and focused financial pressures tools, as well as new incentives, which can maximize the chances of achieving U.S. foreign policy objectives in Sudan.

This new track should focus on the United States’ most pressing policy goals for Sudan: advancing human rights, religious freedom, essential democratic reforms, good governance, and ultimately a comprehensive peace. Without addressing these goals, the Government of Sudan will maintain its longstanding patterns of behavior, advancing policies that have led to the continuous deadly war, religious persecution, dictatorship, mass migration to Europe, grand corruption, and affiliation with terrorist organizations that have marked its rule for the last 28 years.

Achieving the objectives in this new track will require tools that are more focused, sophisticated, and impactful than the dull instruments of comprehensive sanctions we have previously used. Instead, we must use state-of-the-art financial pressures that target key elements of the regime and the corporate and banking networks that underlie it. The comprehensive sanctions in place now come from a previous era and were never robustly implemented and updated. But they nevertheless affected the regime’s ability to connect to the international financial system, especially in recent years, as sanctions enforcement triggered by a different program—Iran’s—caused global banks to go back, review their systems, and realize they were still banking with Sudan through the correspondent banking system. As banks then started to work harder to cut their ties to Sudan, the Government of Sudan launched an aggressive public relations and propaganda campaign, blaming U.S. sanctions for all the miseries inflicted on the Sudanese people by its own massive grand corruption and poor policies.

Rather than giving up this renewed leverage, Congress should adopt legislation that ties a new suite of these modernized financial pressures, as well as appropriate incentives, to a new Human Rights and Peace Track. In particular, the new pressures should include very specific and robust targeted sanctions based on the best financial intelligence available (which our initiative, The Sentry, will help provide) and anti-money laundering measures designed to achieve our foreign policy objectives, and more effectively protect the integrity of the U.S. financial system. This new track can also include incentives: if issues concerning Khartoum’s relationships with terrorist groups not covered in the five-track engagement process are included here, the status of Sudan as a State Sponsor of Terrorism should also be under renewed consideration.

The financial pressures that should be associated with the Human Rights and Peace Track are not just a few more sanctions, or variations on the broad measures of the past. These pressures would constitute a fundamentally different approach, shifting from one that is geography-based to one that is conduct-based. In this new approach, the new pressures would focus solely on individuals and entities that are responsible for major human rights abuses, grand corruption, religious persecution, conflict gold trading, weapons exporting, and undermining any peace process. The approach targets those whose conduct drives this regime, and then it seeks to disrupt the facilitating corporate and banking network that supports them.

We must use the types of dynamic, modern approaches that were taken against Iran, Burma, and Russia and can address the corporate networks and economic sectors in Sudan that provide the financial lifeline to the Bashir regime and enable its repressive capacities and ability to inflict harm on Sudanese citizens. Entities in Sudan like the National Intelligence and Security Service (NISS) operate in ways that are not unlike the entities that the United States has targeted in Iran. In Sudan, conflict-affected gold and weapons exports provide much-needed, off-budget cash that is used to sustain violence and line the pockets of the corrupt elites who have transformed the Sudanese economy into a private domain for their own enrichment.

The United States knows how to target this kind of system; we just need to be willing to do it. Some of the key measures that we could take include:

• Sanctions that freeze the assets of Sudan’s National Intelligence and Security Service (NISS) and its corporate network, establishing a 25 percent threshold for ownership that would result in designation.
• Sectoral sanctions focused on the conflict gold and weapons manufacturing sectors.
• Targeted sanctions on individuals responsible for acts of public corruption and serious human rights abuses throughout Sudan, ensuring we target individuals with significant personal assets and/or corporate holdings.
• Requiring compliance with these sanctions by foreign subsidiaries of U.S. companies to prevent evasion.
• Public reporting by companies doing business in Sudan in order to ensure companies are taking appropriate due diligence measures.
• Directing Treasury’s Financial Crimes Enforcement Network (FinCEN) to investigate whether the gold sector or other networks in Sudan constitute a “primary money laundering concern,” to issue advisories related to their investigations, and to work with financial institutions and other jurisdictions to investigate Sudanese Politically Exposed Persons and other targets. These efforts will focus the financial sector on the key concerns in Sudan and help to mitigate against future, large-scale de-risking.
• Congressional appropriation of funds to the relevant agencies to do this work that has been desperately needed for many years but never done.

These are the types of pressures, combined with appropriate incentives, that can generate meaningful leverage for creating real and lasting change in Sudan through the Human Rights and Peace Track. Changing the behavior of a genocidal regime requires use of the most effective tools we have at our disposal, tools that are narrowly targeted at the sectors and individuals most involved in committing mass atrocities against the population and diverting the country’s rich resources to private purposes. By adopting this framework, Congress and the Trump Administration can finally implement a strategic approach to sanctions and pressures related to Sudan.

This approach would be in stark contrast to the five-track engagement process, which I will address briefly. As my colleague Omer Ismail recently described in his testimony before the Lantos Commission, some of the violence in Sudan has eased. We attribute this in part to the evolving nature of the use of force in the conflict areas. Nevertheless, there are parts of Sudan that have known a more peaceful period in recent months. We also note that Sudan has demonstrated restraint with respect to South Sudan, and we presume cooperation continues on many counterterrorism fronts.

At the same time, as Omer and many others have testified, the Sudanese government’s restraint in some areas contrasts with its continued violence in the conflict zones. There have been numerous violent attacks on civilians in Darfur. Government fly-overs continue to threaten people in South Kordofan, including the Nuba Mountains. There were militia attacks in Blue Nile this year, and in the military campaigns it launched in 2016 the Sudanese government forces used a large quantity of new weapons and new types of military equipment, as Conflict Armament Research has documented. Worse, while the government of Sudan is allowing cross-border humanitarian access to areas in South Sudan affected by famine, humanitarian access for parts of Blue Nile and South Kordofan states remains restricted. The people in several isolated areas urgently need assistance and have been killed while moving through active conflict zones to find food and basic supplies.

Meanwhile, Sudan has used the provisional easing of the sanctions put in place in January, not to begin the necessary reforms of the structural deformities of the country’s economy, but instead to order fighter jets and battle tanks from its traditional arms suppliers, Russia and China. These procurements, when concluded, will buttress the regime’s preferred choice of settling internal conflicts by military means rather than through negotiated approaches that resolve the root causes of conflicts. These types of short-term purchases are made possible by easier access to financing in the global marketplace, principally because there are fewer concerns about the potential for single transactions in a specific timeframe to be blocked or rejected, and a generally more enabling economic environment within Sudan where there is more available capital.

Acknowledging both the progress and areas where benchmarks are unmet, we believe two things should happen with respect to the next steps of the five-track engagement process:

• The interagency assessment process should continue, and an honest assessment should be made in July. Our expectation is that the five-track engagement process will remain unfulfilled when viewed as an entire package, because at least two of the five tracks will not be in compliance. For example, if entire regions of Sudan remain off-limits for aid organizations because of Sudanese government restrictions, continuing this policy of using the denial of food as a weapon, should the United States really permanently remove its sanctions? That would certainly be a shocking outcome even to the architects of this five-track engagement process. If the government is indeed noncompliant on any of the tracks, then the final step of complete removal of the comprehensive sanctions should be delayed for a sufficient period, such as one year.
• In response to the violence in Darfur, and as a way of reinforcing the need for serious engagement on all five tracks leading up to July, the Administration should use its authority under Executive Order 13400, the Darfur sanctions—which are not part of the five-track engagement process—to impose asset freezes on those responsible for the violence. As with other sanctions programs connected to negotiation or engagement processes, the Administration should tighten pressure along the way to reinforce the objectives.

In the end, the fate of the five-track engagement process and the comprehensive sanctions should be a lower priority, because it creates a false policy choice (comprehensive sanctions versus nothing) over benchmarks that do not fundamentally alter the nature of a regime that has wrought havoc within Sudan and the region for nearly three decades. Congress should take the lead in designing a clear U.S. policy approach, one that deploys the types of modernized pressures that can generate meaningful leverage for creating real and lasting change in Sudan through a Human Rights and Peace Track. Changing the behavior of a genocidal regime requires use of the most effective tools we have at our disposal, which could narrowly target the individuals and entities that are most involved in committing mass atrocities against the population and diverting the country’s rich resources to private purposes. We should ensure that these measures are tied to clear foreign policy objectives. This would give the U.S. government the best chance to effectively address its core policy objectives in Sudan.

Read the full testimony here.