VZCZCXRO3587
RR RUEHRG
DE RUEHSO #0019 0091738
ZNR UUUUU ZZH
R 091738Z JAN 09
FM AMCONSUL SAO PAULO
TO RUEHC/SECSTATE WASHDC 8866
INFO RUEHBR/AMEMBASSY BRASILIA 0014
RUEAIIA/CIA WASHDC
RUEHKL/AMEMBASSY KUALA LUMPUR 0319
RUEHRG/AMCONSUL RECIFE 4281
RUEHRI/AMCONSUL RIO DE JANEIRO 8980
RHMCSUU/FBI WASHINGTON DC
RUCPDOC/USDOC WASHDC 3247
RUEKJCS/SECDEF WASHINGTON DC
RUEPINS/HQ BICE INTEL WASHINGTON DC 0305

UNCLAS SAO PAULO 000019 
 
FOR PM/DTCC - BLUE LANTERN COORDINATOR 
 
SIPDIS 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: ETTC KOMC MY BR
SUBJECT: BLUE LANTERN CASE 050136184 

REF: STATE 133964 

SENSITIVE BUT UNCLASSIFIED--PLEASE PROTECT ACCORDINGLY 

¶1. (SBU) SUMMARY: In response to reftel, Econoff visited AVIBRAS munitions manufacturing site and met with company president Sami Hassuani on January 8. The company appears to have adequate security measures to protect sensitive USML items. Hassuani provided copious documentation to support the transaction. END SUMMARY. 

¶2. (SBU) AVIBRAS's supporting documentation included an approximately 1,000 page long sales contract from the Government of Malaysia. It included detailed descriptions of the product, including blueprints. A Principle Deputy Assistant Secretary level representative of the Government of Malaysia (GoM) had signed the contract and it contained the original seal of the GoM. Hassuani also showed original documentation from a similar contract with the GoM in 2000. Plaques, given as gifts to his company for its services from various countries' militaries, decorated an entire wall in his office. Hassuani even showed Econoff his Association of the U.S. Army card, showing his membership since 1984. 

¶3. (SBU) ABIBRAS has four sites, divided into munitions, armor and plating, civilian, and administrative. The compounds themselves are located some distance from the main road and protected by security guards. The munitions facility is located about one mile off kilometer 14 of the Tamoios highway, near the city of Sao Jose dos Campos, Brazil. Upon arrival to the compound, the security guard requested Econoff turn off his cell phone, even though there appeared to be no reception available in the isolated compound. AVIBRAS also retains a member of the Brazilian Air Force to serve as their security liaison. The liaison officer conducts background investigations and grants security clearances to all AVIBRAS employees and contractors, in addition to periodic reviews of compound security. 

¶4. (SBU) AVIBRAS principally manufactures the Artillery Saturation Rocket System (ASTROS II). AVIBRAS also manufactures air-to-air missile delivery systems for Embraer jet fighters, civilian explosives, fuses, and the missiles themselves. They also have developed an unmanned drone. AVIBRAS does not serve as a broker, which Hassuani says is against Brazilian law. They import the parts for their systems and then manufacture the delivery systems themselves. After the product is complete, workers place it in a container and a Government of Brazil (GoB) customs agent travels to the factory to seal the container. The container is not opened again until the end-user receives delivery of the unit. 

¶5. (SBU) AVIBRAS sells exclusively to governments. According to Hussuani, they have sold equipment to the following countries' militaries: Brazil, Saudi Arabia, Qatar, Oman, Kuwait, Malaysia, Brunei, Morocco, Angola, Columbia, Chile, and Ecuador. The GoB must approve all transactions and it does deny sales to certain countries. Hassuani showed Econoff a list of the denied countries, which included Iran, Israel, and Ecuador. 

¶6. (SBU) Joao Verde Leite founded AVIBRAS in 1961 and he was the principal owner until he died in a helicopter crash last year. His surviving family retains ownership of the company, administered by his son, Joao Brasil Leite. Hassuani runs the day-to-day operations of the AVIBRAS. The company at one time employed 6,000 people, although today that number has fallen to 1,200. 

¶7. (SBU) Hussuani assured Econoff that the company understood the restrictions on USML items, as well as the prohibition against unauthorized stockpiling. The company took Post's visit seriously, brining out four ASTROS II units for display and Hassuani himself accompanied Econoff on every portion of the tour.

 WHITE