Posts Tagged ‘hawala’

h1

Recognizing the risks of Somali remittances

March 11, 2014

This piece is also appearing over at Terror Finance Blog today:

Last week, Bell State Bank in North Dakota announced that it would stop doing business with companies that remit money to Somalia.  The move follows decisions by Minnesota banks in 2011 to stop providing Somali remittance services, and an attempt by Barclays last year to cut off its partnership with Dahabshiil, a money transfer company with primary operations in Somalia.  The banks have been challenged in courts on both sides of the Atlantic, and advocacy groups have heavily criticized the banks’ decisions on humanitarian grounds.

Indeed, humanitarian considerations are of the utmost importance.  Unfortunately, money transferred to Somalia, particularly through Dahabshiil, all too often falls into the wrong hands and perpetuates the cycle of violence in Somalia.  Banks should stand fast in their original decisions, and here are five reasons why:

  1. The risks are real.  The frequency of cases involving Somalis in the West transferring funds to al-Shabaab over the last few years presents genuine concerns to financial institutions.  For instance, four men in California were found guilty last year of transferring money to al-Shabaab through Shidaal Express, a Somali hawala business.  Two Somali women in Minnesota were sentenced in 2013 for sending money to al-Shabaab through several remittance channels including local hawala dealers and Dahabshiil.  A Saudi-American was also indicted last year for wiring money to al-Shabaab.  In 2012, a man in London admitting transferring £8,900 to fighters in Somalia.  Danish intelligence revealed in 2012 that the equivalent of thousands of dollars a day is sent to terrorist organizations outside of Denmark—mostly to Somalia, and often unwittingly.  In addition to genuine risks on the ground in Somalia, Western banks have real reasons for concern that if they continue relationships with Dahabshiil, they could subsequently be fined by regulators at a future date if political winds change.  U.S. banks are surely aware, for example, that decisions on whether to fine, settle with, or prosecute banks with lax compliance programs have a great deal to do with the shifting political and prosecutorial priorities of whoever happens to be in charge at the Department of Justice and the financial regulatory agencies.  One official may take a very friendly view toward facilitating Somali remittances this year, but a different person will be calling the shots two years from now.
  2. The risks are not decreasing.  Gone are the days of 2012 when al-Shabaab appeared to be on the ropes in 2012 both financially and militarily.  Al-Shabaab was able to turn around its financial situation after the fall of Kismayo by cutting deals with occupying forces.  Al-Shabaab continues to profit from imposing taxes on commodities such as charcoal and sugar, and their role as ivory trade middlemen between poachers and buyers appears to be growing.  Al-Shabaab is still capable of carrying out devastating strikes such as the Westgate Mall attack and the recent assault against Somalia’s presidential palace that left 11 dead.
  3. Dahabshiil poses a unique risk.  Western readers should be aware of independent reports by the Somali diaspora news media that Dahabshiil finances terrorism.  According to reports by Waagacusub, Kalshaale, and Suna Times, Dahabshiil pays one-half million dollars twice a year to al-Shabaab. The payments allegedly resumed last year after a brief dispute during which Dahabshiil had ceased making payments.  One Guantanamo Bay detainee previously worked for Dahabshiil, and the presiding officer at a hearing for that detainee determined that his Dahabshiil branch transferred money for terrorism.  However, coverage of these allegations has been limited partly due from legal threats against journalists and online reputation management by Dahabshiil. Read the rest of this entry ?
h1

Illicit transfer news: recommended reading

February 20, 2014
  • Palestinian Islamic Jihad “receives between $100-$150 million dollars annually from Iran,” says an Iranian expert… more>>
  • FinCEN shuts down a Michigan-based hawala dealer who sent 8,000 wires to Yemen and never checked a single customer’s ID… more>>
  • We don’t know how much money is financing terrorism, and we don’t know how much it costs to combat its financing either, so how do we know if what we’re doing is working?  More>>
  • A New Jersey company illegally shipped $70,000 worth of protective gloves to Iranmore>>
h1

Fourth Somali sentenced in terror cash case

February 9, 2014

Ahmed Nasir Taalil Mohamud, a taxi cab driver in California, has been sentenced to six years in prison for transferring funds overseas to the terrorist group al-Shabaab.  His fellow conspirators–another cabbie, an imam, and a hawala dealer–were sentenced to longer terms previously.

Money Jihad readers will recall that this case illustrates how the Somali remittance industry is fraught with the constant risk of funding al-Shabaab.  U.S. and British banks that have ceased doing business with Somali hawala houses like Shidaal Express, Qaran Financial Express, and wire services companies such as Dahabshiil, are well-justified if not required by anti-money laundering and know-your-customer requirements to sever such ties.  The humanitarian benefits of sending money to Somalia are far outweighed by the high probability that the money will be directed to, diverted by, or extorted for al-Shabaab to buy weapons and carry out operations that ultimately harm more Somalis than such money helps.

U-T San Diego reports (h/t Arun Hindu):

Final sentence in Somali terror case

By Kristina Davis, Jan. 31, 2014

SAN DIEGO — An Anaheim cabdriver who raised funds to aid terrorists in his war-torn homeland of Somalia was sentenced Friday to six years in prison, where he will join three other San Diego Somalis who were sentenced in the scheme two months ago.

Ahmed Nasir Taalil Mohamud, 38, played the most minor role among the four men, said U.S. District Judge Jeffrey Miller.

Prosecutors say Nasir raised about $1,000 from other cabdrivers in Orange County to send to al-Shabab fighters, who are using violence to try to overthrow the East African country’s transitional government.

The fundraising was coordinated by Basaaly Moalin, a San Diego taxi driver in contact with al-Shabab overseas.

Moalin, a naturalized U.S. citizen, was given 18 years in prison — the longest term — when he was sentenced in November.

Mohamed Mohamed Mohamud, who used his influence on the local Somali community as a City Heights imam, got 13 years. Issa Doreh, who worked at a money transfer business the men used, received 10 years.

The men have already served three years and will be required to serve at least 80 percent of their terms.

Even though Nasir’s role was minor, Assistant U.S. Attorney William Cole said in court that Nasir and Moalin were talking about real people’s lives when it came to what the money would be used for.

“It was a serious offense,” Cole said.

Nasir and Moalin met years earlier in St. Louis, where Nasir had moved to work as a cabdriver, said his lawyer, Thomas Durkin. They then moved to California, where they could make more money…

h1

Hawala used to launder £20 million in England

January 26, 2014

A British trial has revealed that criminal gangs have been laundering drug money by sending it through hawala and conventional banking channels from England to a hawala dealer overseas to send back to the gangsters in the U.K.

Despite the seriousness of the underlying crime, four of the men involved in the scheme have received light sentences ranging from three years in prison to supervised release with no prison time.  The sentencing is reminiscent of that of New York hawala dealer Faisal Shahzad, who funded the failed Times Square bomber and got off with probation.

Meanwhile, law enforcement and financial regulators continue to make marginal or piecemeal recommendations for how to protect financial markets and the public from the inherent risk of hawala transactions.  One simple idea would be to impose tougher penalties and longer sentences for hawala crimes.

From the Liverpool Echo on Jan. 17 (h/t Arun):

Gang who laundered more than £20m using ancient Islamic system jailed

Two Liverpool men part of four man gang

Two Liverpool men who helped launder more than £20m of drugs money through banks were spared prison.

The money is believed to have been laundered using legitimate bank accounts and an ancient  Islamic money lending system.

Kamran Butt and Instar Ahmed, from Greater Manchester and Liverpool men Steven McKenna and Sean Moore were put under surveillance by police in two undercover operations.

But officers found they were linked when Butt and Ahmed were seen depositing money into  the same bank accounts.

The money was transferred to the defendants, who were recruited by operatives in the Middle East, using the ‘Hawala’ system – an informal Islamic way of lending money based on honour agreements and third-party lenders.

A fifth man, named in court as ‘Akhtar’, was also heavily involved – but was deported to  Pakistan in 2012 and has not been traced since.

Watched by undercover police, Akhtar and Ahmed were seen depositing huge sums of money  at banks in Chorlton, Longsight and Manchester city centre.

The two men would travel to branches of Lloyds, HSBC and Halifax together but then pretend  not to know each other once inside.

Ahmed also worked in partnership with others in the gang.

Manchester Crown Court heard how on Monday, August 22, 2011, police intercepted Ahmed and McKenna and seized three rucksacks stuffed with more than £200,000 in cash.

On another occasion, Moore was seen with Butt in his Mercedes car.

Butt was stopped and a bag was seized, which was found to contain about £120,000 in cash.

His Stretford home was then searched and a further £10,000 was seized.Cash receipts in vehicles traced to the four men showed they were paying in anywhere from £500 to £10,000 a time.All the money is believed to have come from criminal gangs, mainly through drug sales.

The criminal cash was given to a Hawala money lender abroad who then transferred the  money to a Hawala lender in the UK and gave them a password.

This password was then passed onto one of the defendants allowing them to collect the cash.

They then paid the money into bank accounts in Manchester which the criminals had access to.

The court heard the four defendants were the bottom of the chain – below controllers and then  co-ordinators, working as collectors to receive the money, deliver it and pay it into various bank accounts in the UK.

After being caught, all four defendants pleaded guilty – Moore to two charges of money  laundering and Butt, McKenna and Ahmed to one charge of money laundering each.

Butt, of Great Stone Road, Stretford, was believed to be behind £12m in laundered cash, and  was sentenced to three years and six months.

Ahmed, of Kelstern Square, Rusholme, who is believed to have laundered £10m also received  a sentence of three years, six months.

Moore, of Kingfisher Grove, Liverpool, and McKenna, of Maley Street, Liverpool, both received  14 month sentences suspended for 12 months and 12 month supervision orders.

Moore was ordered to carry out 108 hours unpaid work and McKenna 150 hours…

h1

Russia nabs Islamist-funding mobsters

December 4, 2013

Organized crime is a huge global enterprise generating up to $900 billion per year.  The possible link between organized crime and terrorism in Russia shown by recent arrests poses a disturbingly massive problem which authorities will have to continue confronting.

In this case, money from a Central Asian crime syndicate was being transferred partly by hawala, the traditional Islamic debt transfer system, to Hizb ut-Tahrir, a radical Sunni group that seeks the creation of a new caliphate.

Hat tip to El Grillo for alerting us to the news.  This article comes from Blouin News:

Russia cracks down on gangs financing jihadist terror

On November 25, Russian police detained seven leaders of a large ethnic Central Asian organized criminal group whom they have accused of running an underworld financial operation. Their claim is that this 18 billion ruble-a-year (that’s US$550 million) venture was financing the Hizb ut-Tahrir (Islamic Liberation Party) movement, banned in Russia for its links to international Islamist terrorist organizations. The arrest demonstrates not only Russia’s continuing campaign against jihadist terrorists but also a growing concern about its rise in Central Asia and amongst the Central Asian diaspora.

According to police accounts, the organization, which had more than 40 members, was active in major markets across Russia, including Moscow and the Perm Region. Over 178 million rubles ($5.4 million) were seized in the operation. The syndicate reportedly engaged in fraud, protection racketeering, illegal migration scams and laundering not just its own dirty money, but that of other Central Asians, as well as natives of Azerbaijan, Georgia and Abkhazia. The arrested leaders reportedly held Russian, Georgian, and Uzbek citizenship.

The gang also seems to have been highly structured, with separate sections responsible for each stage of their operation, from collecting the money to transferring it to temporary deposits and then moving funds to shell companies. There were some 120 foreign commercial entities and accounts that they used to launder their funds, and they also made use of the global network of informal hawala “shadow bankers” to move substantial sums internationally without turning to traditional banking channels.

According to the police, they have evidence that the group financed Hizb ut-Tahrir. The organization was banned in Russia in 2003 as an extremist group.  With jihadist sentiment apparently on the rise in Central Asia and more than 5 million Central Asian legal migrants and temporary workers in Russia — and unknown number of illegals, but possibly another 2-3 million — the Kremlin is concerned that such extremist views will spread…

h1

Front charity JKART funds Hizbul Mujahideen

August 21, 2013

The Jammu & Kashmir Affectees Relief Trust is helping to finance the terrorist organization Hizbul Mujahideen through the traditional Islamic money transfer system of hawala and through cash couriers.

Indian officials are investigating; Rediff has the story (h/t to @creepingsharia for sending in related news):

…The National Investigation Agency is investigating ten cases related to funding of terrorist groups. They have found that in all Rs 600 crore has been pumped in for terror operations since the last two years through donations and relief funds. The organisation which has topped this list is the Jammu and Kashmir Affectees Relief Fund Trust.

NIA officials told rediff.com that during investigations they found the organisation alone had pumped in Rs 95 crore [approx. 16 million USD]. The money was being collected under the pretext of relief work in the valley. The NIA has learnt that the group is headed by two Pakistani nationals Mahboob Haq and Masroor Dar, who subscribe to the Hizbul Mujahideen.

The NIA says the group has been working in the valley since the past 10 years and has collected huge sums of money which has been diverted to Pakistan based militant groups.

The money is either handed over in person to terrorists who infiltrate into the valley or is transferred through a hawala channel. Apart from providing finances, the JKART has also helped terrorists infiltrate into India. In the past 10 years they have helped over 1,000 terrorists to come into the valley.

An intercepted conversation between Dar and Syed Salahuddin blew the lid off the JKART’s activities. The NIA also took into custody an operative by the name of Shafi Shah, a resident of Bandipore in Kashmir. During interrogation the NIA learnt about its funding and other organisations that helped fund the operations…

h1

Mujahideen paid by D-Gang’s hawala

May 17, 2013

The Indian Mujahideen finance their jihadist operations with money distributed through terror mogul Dawood Ibrahim’s illegal hawala network.  While it has long been known that Dawood Ibrahim is a bankroller for terrorism, his specific ties to the Indian Mujahideen are what makes this article from the Hindustan Times newsworthy:

Is Dawood funding Indian terror?

Presley Thomas     Mumbai, May 03, 2013

Dawood Ibrahim, the man who maimed Mumbai on March 12, 1993, has emerged as the face behind homegrown terrorist outfit Indian Mujahideen (IM). Dawood and his intricate network of bogus hawala firms, spread across the country, have been covertly financing IM’s network in India, said sources in the central agencies and counter-terrorism units investigating blast cases across the country.

The Financial Action Task Force (FATF) has been informed of Dawood’s alleged extensive hawala network in the Middle East and South Asian countries. A detailed probe by the Anti-Money Laundering / Suspicious Cases Unit (AMLU) is underway in the Middle East, sources said.

The involvement of Dawood’s  gang, the D-Company, in financing terror through his network of hawala firms was unearthed during investigations into the July 13, 2011 blasts in Mumbai, (where the IM was allegedly involved) said sources in central agencies and counter-terrorism units. Many key players in the attacks are suspected to have links with Dawood.

A sum of Rs. 10 lakh had been sent by alleged hawala operator Muzzafar Kola to IM kingpin Yasin Bhatkal through Delhi-based Kanwar Nain Pathrija, police sources said. The investigating agencies then suspected the involvement of the D-Company and intercepted telephone conversations from across the border showed directions being given to certain people, along with details of the money flow and transfers through hawala transactions. Kola, sources said, was a Mustafa Dossa man who later became a Dawood associate.

These reports led agencies to believe that Bhatkal, a Fazal-ur-Rehman gang member who now heads the IM, was working closely with Dawood and his company…

h1

Mumbai: bank robberies and bitcoin fund terror

April 16, 2013

The Indian Mujahideen have been using bank robberies to finance their activities according to a former high-ranking law enforcement official.  D. Sivanandhan is also concerned about bitcoin’s role in funding militants, but it should be noted that no evidence or data are included in this news report:

Banks looted to finance terrorism: Security expert

Mumbai, April 11 (IANS) Bit coin and crypto currencies are becoming major avenues for money laundering and terror groups often rob banks for funding terrorist acts, a top security expert said.

“Investigations have revealed that the hijackers of the Indian Airlines IC-814 had looted a bank three months before the (Kandahar) hijack, which helped them finance the entire terror operations,” said former Maharashtra director general of police and security expert D. Sivanandhan.

Similarly, the terror outfit Indian Mujahideen has also been allegedly involved in several bank robberies to finance its operations, Sivanandhan said at a conference — ‘Leveraging Innovative Security Solutions for Banks and Financial Institutions’ — that concluded here late Wednesday…

See related Money Jihad coverage of bank robberies for jihad here, here, and here, and background on the Indian Mujahideen’s financial activities, which include hawala and extortion, here.

h1

India: hawala is 30 percent of terror revenues

April 12, 2013

Hawala, the traditional Islamic system of transferring money and debts, is essentially outlawed in India.  However, the practice, which is difficult to trace and lends itself well to illicit financial activity, is still commonplace.  A recent article in the news website Rediff.com asserts that 10 percent of all such hawala transactions in India go toward funding terrorism, and that 30 percent of terrorists’ money comes from hawala.  Much of it is transferred from the Gulf (including Dubai) to Kerala, a hotspot for terror finance.

Time to revisit hawala policy?  Money Jihad thinks so.

H/t to Bob Connors.

Crores being pumped into India by ISI to finance terror

Apr. 1, 2013

In almost every hawala deal, 10 per cent of the amount goes towards terror funding, reports Vicky Nanjappa  

A sharp rise in the number of terror financing cases in 2012 in India is an indicator to how well terror groups have channelized their resources.

According to the Financial Intelligence Unit, in 2009, the number of terror financing cases was recorded at 200 but rose to 1,400 cases in 2012.

The FIU report states that the Inter-Services Intelligence in Pakistan manages to raise Rs 1,800 crore annually to fund terrorist activities especially against India. Today, the Intelligence units say that the amount has shot up to Rs 2,400 crore, as the intensity of their programme against India too is expected to see a rise.

In the past, the ISI adopted to circulating fake Indian currency, ensuring that a certain amount of money through hawala transactions, extortions and drug trade was handed over to them.

As per the latest FIU report, there have been 1,444 cases of terror financing last year. In 2011 the figures were 428 cases and in 2010 it was 316.

Sources in the Intelligence Bureau say that out of the 1,444 cases, almost 65 per cent are related to fake currency.

Last year, around 3,20,000 fake notes of Rs 500 and Rs 1,000 denominations were found, while the year before that around 2,50,000 notes were found.

Sources say that while fake currency accounted for a major chunk of terror financing, hawala transactions accounted for at least 30 per cent. In almost every hawala deal, 10 per cent of the amount goes towards terror funding. The biggest hawala transactions have been from the Gulf to Kerala. Proof of such transactions being used for terror related activities was found during the 2006 train bombings in which an amount of Rs 4.5 lakh was exchanged to carry out the attack.

The Indian Mujahideen in particular has a dedicated network through which it collects money in Delhi. The money is wired from Gulf to Kerala and then to New Delhi…

h1

Health care fraudsters sent $1.1 million to Iran

March 26, 2013
http://www.yourvalleyvoice.com/news/article_0cc20972-ab7c-11e1-8872-001a4bcf887a.html?mode=image&photo=0

Hossein Lahiji, Co-defendant

Hossein and Najmeh Lahiji, a naturalized U.S. citizen and his wife, have been indicted for medical billing fraud in Texas, and for sending the illicit proceeds to Iran in violation of U.S. sanctions.  Dr. Lahiji even accepted payments for medical treatment he claimed to perform in Texas while he was actually in Tehran.

The Lahijis funneled the dirty money through Espadana Exchange, an “unlicensed money remitting business”—ie, hawala business.  Iran sanctions expert and D.C. attorney Erich Ferrari has previously advised Iranian-Americans to “Just Say No” to engaging in hawala, also called havaleh, transactions destined for Iran.  Evidently, the Lahijis didn’t take his advice.

The couple’s trial was scheduled to begin yesterday.  The U.S. attorney’s office has these details:

McAllen Urologist and Wife Charged in Heath Care Fraud Scheme and Conspiracy to Violate Iranian Sanctions

HOUSTON – A federal grand jury has returned a four-count, superseding indictment against urologist Hossein Lahiji M.D. and his wife, attorney Najmeh Vahid Lahiji, both of McAllen and San Antonio, United States Attorney Kenneth Magidson announced today. The second superseding Indictment, returned late yesterday, charges the couple with conspiracy to commit health care fraud, health care fraud and for conspiring to violate Iranian sanctions.

The Lahijis are set to appear in Houston tomorrow morning at 9:45 before U.S. District Judge Mary Milloy.

This indictment alleges the Lahijis conspired to violate Iranian Sanctions by transferring approximately $1.1 million to Iran. The Lahijis allegedly utilized an unlicensed money remitting business called the Espadana Exchange to avoid the United States banking regulations and to allegedly make it appear they were not violating the United States embargo with Iran. The indictment alleges the defendants sent some of the monies representing profits of their alleged illegal health care fraud scheme to Iran for the purpose of making an investment on behalf of Hossein Lahiji and Najmeh Vahid Lahiji in real estate rental property in Iran, all in violation of the Iranian sanctions.

“The Internal Revenue Service (IRS) will tenaciously pursue individuals who violate international emergency economic powers statutes,” said IRS-Criminal Investigation (CI) Special Agent in Charge Lucy Cruz. “IRS-CI’s unique skill set is to unravel the often concealed complex networks used to disguise international financial crimes.”

The health care fraud scheme alleged in this indictment accuses Hossein and Najmeh Lahiji of conspiring to defraud multiple health care benefit programs by submitting false and fraudulent claims in connection with the use of unlicensed and unqualified medical personal and for billing for medical services not rendered. Read the rest of this entry ?

h1

Somali conspirators found guilty as charged

March 6, 2013

San Diego imam and three cohorts laundered money, financed terror

http://bloximages.chicago2.vip.townnews.com/indianapolisrecorder.com/content/tncms/assets/v3/editorial/d/5d/d5d091ae-7f65-11e2-a3e7-0019bb2963f4/512b8cf9a77f9.preview-300.jpg

Two of the four financiers: Imam Mohamed Mohamud (left) and Issa Doreh (right)

Many readers are probably already aware of the conviction as it has received fairly extensive print news coverage.  The best report on the Feb. 22 verdicts comes from the FBI itself:

San Diego Jury Convicts Four Somali Immigrants of Providing Support to Foreign Terrorists

Defendants Sent Money to al Shabaab in Somalia

SAN DIEGO, CA—A federal jury today convicted four Somali immigrants, including a popular imam at a City Heights mosque, of conspiring to provide material support to the terrorist group al Shabaab.

The jury found that the four men—Basaaly Saeed Moalin, a cabdriver in San Diego; Issa Doreh, a worker at a money transmitting business that was the conduit for moving the funds; Mohamed Mohamed Mohamud, the imam at a mosque frequented by the city’s immigrant Somali community; and Ahmed Nasiri Taalil Mohamud, a cabdriver from Anaheim—conspired to raise money for the foreign terrorist organization and send it back to Somalia.

During the three-week trial, the United States presented evidence that Moalin, Mohamud, Doreh, and Nasir conspired to provide money to al Shabaab, a violent and brutal militia group in Somalia that engages in suicide bombings, targets civilians for assassination, and uses improvised explosive devices. In February 2008, the U.S. Department of State formally designated al Shabaab as a foreign terrorist organization.

At trial, the jury listened to dozens of the defendants’ intercepted telephone conversations, including many conversations between defendant Moalin and Aden Hashi Ayrow, one of al Shabaab’s most prominent leaders who was subsequently killed in a missile strike on May 1, 2008. In those calls, Ayrow implored Moalin to send money to al Shabaab, telling Moalin that it was “time to finance the Jihad.” Ayrow told Moalin, “You are running late with the stuff. Send some and something will happen.” In the calls played for the jury, Ayrow repeatedly asked Moalin to reach out to defendant Mohamud—the imam—to obtain funds for al Shabaab.

According to the evidence presented at trial, the defendants conspired to transfer the funds from San Diego to Somalia through the Shidaal Express, a now-defunct money transmitting business in San Diego.

The United States also presented a recorded telephone conversation in which defendant Moalin gave the terrorists in Somalia permission to use his house in Mogadishu, Somalia, telling Ayrow that “after you bury your stuff deep in the ground, you would, then, plant the trees on top.” Prosecutors argued at trial that Moalin was offering a place to hide weapons…

Basaaly Moalin, the most malicious and vocal of member of the conspiracy, could be sentenced to a maximum of 80 years in prison, with his co-defendants facing shorter terms.

The disturbing (but frankly unsurprising) involvement of an imam in the conspiracy is not the only important takeaway from this trial.

The critical lesson illustrated by this case is that remittances to Somalia are fraught with risk; ordinary Somali customers undoubtedly used the services of Shidaal Express prior to its closure.  Even customers who had no intention of funding terrorism supplemented Shidaal’s business and indirectly aided al-Shabaab.

http://pics3.city-data.com/businesses/p/9/6/9/1/6309691.JPG

Shidaal Express in San Diego

This is why banks have to make very careful decisions about money services businesses (MSBs) that they may take on as commercial clients.  Banks must evaluate whether the risk of supporting terrorism is too high to continue doing business with a particular individual or MSB.

Why on earth would anybody still criticize banks in Minnesota for ceasing to providing money transfer services to Somalia?  The evidence has become far too clear that Somali remittances bear an unacceptable risk of being siphoned off for terrorist purposes.

IPT has previously reported on the details of the money transfers in the San Diego conspiracy, which further illustrate the fundamental riskiness of the Somali remittance business:

The men used hawalas—both registered and unregistered—to move money from the United States to African countries. Two of the hawalas identified—Shidaal Express, Inc.,and North American Money Transfer, Inc.—have a history of money laundering and terror-financing violations, public records show.

Take, for example, North American Money Transfer (NAMT) which is incorporated in Georgia, but has branches in Missouri and elsewhere throughout the United States. In August 2009, the Justice Department charged the company with a series of financial crimes, including operating as an unlicensed money transmitting business in the State of Michigan. According to the indictment, between Jan. 3, 2008 and April 15, 2009, “NAMT wire transferred approximately $12,820,000 from the United States to Africa Horn in the United Arab Emirates, for distribution to the intended recipients in Somalia and other countries located in the Horn of Africa.”

Over a period of 10 months, the defendants in the cases announced Wednesday raised and transferred approximately $26,000 from various locations within the United States to Somalia. Separating the payments into 20 separate transactions, each of them were structured to evade the $3,000 limit that would have required the hawala to verify a name and address of the sender through a photo identification.

Follow

Get every new post delivered to your Inbox.

Join 4,866 other followers