Archive for September, 2011


Medieval Islamic tax alive in al-Shabaab

September 22, 2011

Ever heard of a tax route?  A tax route is a road which people or merchants travel and end up getting taxed along their way.  It’s something like a toll road.  Except in Islamic tax law, the toll is imposed simply for passing through an Islamic jurisdiction.

In their recent report, the U.N. monitoring group on Somalia and Eritrea depicted the tax routes of al-Shabaab in this graphic.  The route between Mogadishu and Xarardheere alone nets up to $85,000 per week in taxes.

Ashir jurisdiction of al-Shabaab

This is not the first time we have heard of jihadists imposing checkpoint taxes on Africans.  Hizbul Islam was reported to have established roadway taxes on Somali truckers in the spring of 2010.


Weekly word: murabaha

September 21, 2011

Suppose that John Consumer lives paycheck to paycheck.  John has no credit card.  He can’t afford to buy that nice flat-panel television he wants.  So he visits his local Rent-A-Center or Aaron’s store, picks out at TV, signs a rent-to-own contract, and takes the TV home, and makes monthly payments while the store remains the legal owner of the merchandise until John has paid off the terms and owns the TV outright.

In the process, John has spent more money in total payments than he would have if he’d been able to buy the TV set upfront, as is the case when any purchase is financed over time.  But that’s okay with him because he got a product he could not afford otherwise.  And it’s okay with the store because they made a little profit in the transaction, which is why they’re in business.

On its face, the rent-to-own approach or installment sale approach is somewhat similar to the sharia financial device known as murabaha.  Vogel & Hayes define murabaha as:

A sale contract which fixes the price in terms of the seller’s cost plus a specified percentage markup.  The seller must disclose all items of expense which are included in the cost if these are not known through custom.*

However, several distinctions between murabaha and Western style rent-to-own agreements come to mind immediately:

  1. There is no fundamental effort by rent-to-own sellers to introduce an alternative set of orthodox religious financial laws to Western markets in order eventually to replace them.
  2. Rent-to-own is just one way out of many available to Western consumers to finance their purchases.  Buyers without enough cash on hand still have options including credit cards, conventional loans, leases, ordinary renting, and lay-away.  Western financial laws do not force people into rent-to-own agreements.
  3. Rent-to-own options are typically designed for items like furniture, electronics, and major appliances.  The free market has determined that for more expensive items such as homes and commercial property, traditional interest-bearing traditional loans are a more responsible way of factoring in the time value of money over the life of the loan.  Murabaha, however, is often applied to big ticket items such as home mortgages, interbank and business-to-business transactions, and commodities trading.

The “profit” or markup added to murabaha transactions is often criticized by Muslim traditionalists as a smokescreen for riba (interest), which is banned by the Koran.  However, many sharia advocates stand by murabaha since it is their likeliest way to supplant conventional financing methods.

Next week, Money Jihad will evaluate the #1 biggest difference and danger that murabaha presents relative to the conventional loan process.

* Vogel, Frank and Hayes, Samuel, Islamic Law and Finance (Boston: Kluwer Law International, 1998).


Hezbollah in Havana with $1.5 million budget

September 20, 2011

Fidel Castro calls the U.S. control of Guantanamo Bay “una daga en el corazón del suelo cubano”—a dagger in the heart of Cuban soil.

But apparently the Castro brothers have no such qualms about inviting a fundamentalist Islamic dagger to be plunged into the heart of their island.  Twenty-three Hezbollah operatives are due to arrive to establish a cell in Cuba (h/t Israel Matzav) to plot an attack against a South American Israeli target.

The terrorists will take a $1.5 million budget with them.  The Italian newspaper Corriere della Sera says the operation was signed off by Hezbollah chief Hasan Nasrallah.  Often, terrorists are able to spend about 10 percent of their operating budget on the actual attack (with the other 90 percent going toward salaries and routine expenses).

This report surfaces shortly after Cuban denials of the U.S. conclusion that Cuba remains one of only four state sponsors of terrorism in the world.  The U.S. State Department has noted that Cuba never renounced its ties to the stinking rich guerrilla Marxist FARC, and that it allows Basque terrorists to live in Cuba.

With Venezuela, Guyana, Haiti, Trinidad, Florida, and Cuba all playing host to Islamists, the Caribbean has become the hatchery for the jihadist egg in the Western Hemisphere.


Al-Shabaab levies zakat tax on charcoal

September 19, 2011

The recent report from the U.N. monitoring group on Somalia and Eritrea describes one of the many revenue sources of economic powerhouse al-Shabaab as a 2.5 percent tax on coal.

Let’s see—2.5 percent for producers, 2.5 percent for transporters, 2.5 percent for workers…  I’m sensing a pattern.  But golly gee, what’s the significance of 2.5 percent?  As detailed as their report is, the U.N. doesn’t spell out the fact that 2.5 percent is equal to one-fortieth, which is the rate set for the zakat tax by the Hadith and the Profiteer Muhammad.

Islamic law also applies the same 2.5 percent rate as a customs duty against articles of trade by Muslim merchants.  Al-Shabaab is carrying out Sura 106 of the Koran and the precedent set by Caliph Umar in so doing.

With the firm Islamic context in mind, here are some of the findings from the U.N.:

Table: Tax figures for charcoal production in Al-Shabaab controlled areas in April 2011

  • “Local charcoal producers pay a ‘production tax’ of 2.5%, in return for which they receive production ‘certificates’. The charcoal is transported to port on trucks, whose owners are also required to pay a tax of 2.5% of the estimated value to Al-Shabaab. In addition, if stopped at a checkpoint, truck owners pay a checkpoint fee per truck (Annex 3.2.a and 3.2.b). Failure to pay taxes can lead to seizure of the consignment and/or imprisonment…”
  • “The owners of barges that carry the charcoal from Baraawe to offshore vessels pay a tax of 2.5% of the estimated value of their cargo. While smaller boats are charged $0.5 per sack of charcoal. Porters employed for loading and discharging charcoals must also pay 2.5% of their salaries to Al-Shabaab…”
  • “Some privileged companies are permitted to export charcoal tax free, using green colored sacks reserved exclusively for Al-Shabaab-approved enterprises. These sacks are not available for purchase on the local market, and are usually sourced in Dubai, the UAE.”

Paper money “utterly haram”

September 18, 2011

Islamic “philosopher” Imran N. Hosein isn’t done talking about the evil of Western paper money.  During a live audio linkup from Trinidad to South Africa during Ramadan last year, Hosein lectured a Capetown mosque on the wickedness of “bogus and fraudulent and utterly haram paper currencies.”

Hosein argues that Western nations are “playing God” by creating money.  In order to protect the ummah (Muslim community) from this “storm” of infidel currency and shirk (Arabic for idolatry), Allah has metaphorically put the ummah to sleep in a cave.  Hosein concludes that, one day, the ummah will awake to a world that uses only gold dinars and silver dirhams.

Here’s a four-minute excerpt about the money.  Take a listen:

The full, bloated 72-minute lecture (covering everything from Muslim dress codes, last year’s floods in Pakistan, and the sinking of some island in Dubai) is here for those with enough patience to listen to this bizarre yet colorful Islamist nutjob.


Kenyan official gives to mosque, al-Shabaab

September 16, 2011

Kenyan minister of tourism Najib Balala gave a 200,000 shilling check that was wired to an al-Shabaab operative.  A United Nations report published last month (see related coverage here and here) also includes a photograph of Balala giving a cash donation to an al-Shabaab leader.

Balala claims he was simply giving a donation to a mosque, and that he does not support al-Shabaab.  Even if Balala is innocent, this story is further evidence of how Kenya is being sadly exploited by Islamist opportunists as a fertile fund-raising ground for jihad.

This video should also raise a few eyebrows with respect to major mosque building projects around the world, and whether the funds being donated to their construction is being used for the purposes described in public.


IRW excludes Kashmir from India map

September 15, 2011

Islamic Relief Worldwide, which is one of the world’s largest Islamic charities, depicts Kashmir as a separate country from India on its website.  This puts IRW in line with Muslim Kashmiri separatists.  Perhaps this shouldn’t be surprising given IRW’s history of aiding Hamas and having Muslim Brotherhood associates serving as leaders in IRW.

This map appears on IRW’s “Who We Are/About Us” page.  IRW puts a thin little white line between India and the Kashmir territory which India itself administers:

Kashmir is a territory of India although Pakistan disputes it.  Official United States maps show Kashmir as being part of India.  IRW is based in the U.K. but has partner offices in the U.S. and around the world.

If IRW sends money to Kashmir, and if IRW believes that Kashmir isn’t part of India, exactly what kind of groups and what kind of causes is IRW funding there?  It doesn’t take much imagination to figure it out.