Posts Tagged ‘Barclays’

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Lawsuit: sanctions evasion helped kill U.S. troops

November 30, 2014

Many of the attacks during the Iraq insurgency that left over 4,000 American troops dead were carried out by Sunni militants funded by and aligned with Al Qaeda, former members of Saddam Hussein’s regime, the Gulf monarchies, or combinations of all three. But a new lawsuit by veterans and the families of our war dead is pointing out that a lot of the killing of coalition forces also came from Shia terrorists trained and funded by Iran. Iran was able to fund the trainers of those terrorists partly because of Iran’s access at the time to the international financial system as allowed by major banks with branches in the U.S. despite the sanctions against Iran throughout the 2000s.

From Reuters earlier this month (h/t El Grillo):

U.S. veterans sue banks, claim they should pay for Iraq attacks

Wounded U.S. veterans and family members of U.S. soldiers killed in Iraq sued five European banks on Monday, seeking to hold them responsible for shootings and roadside bombings because they allegedly processed Iranian money that paid for the attacks.

The lawsuit filed in U.S. District Court in Brooklyn, New York, named Barclays Plc, Credit Suisse Group AG, HSBC Holdings Plc, Royal Bank of Scotland Group Plc and Standard Chartered.

Barclays, Credit Suisse, RBS and Standard Chartered declined to comment. HSBC did not respond to requests for comment.

The lawsuit was brought under the U.S. Anti-Terrorism Act, a 1992 law that permits victims to bring private suits against alleged financiers of militant operations.

The lawsuit alleges the banks conspired with Iranian banks to mask wire transactions in order to evade U.S. sanctions. The Iranian banks then funneled more than $100 million to militant groups that operated in Iraq at Iran’s direction, according to the suit.

The militant groups included a Shi’ite militia in Iraq, Kataib Hezbollah, as well as Quds Force, the overseas arm of Iran’s Islamic Revolutionary Guard Corps, the suit says.

Since 2009, the five banks have agreed to pay about $3.2 billion to the U.S. government to resolve allegations that they handled money in violation of sanctions against nations such as Iran, Libya and Cuba. All the banks signed deferred prosecution agreements with the U.S. Justice Department in addition to settlements with U.S. banking regulators…

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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 alleged failures in Dahabshiil’s anti-money laundering and counter-terror finance compliance programs to include possible extortion payments made to al-Shabaab to operate in Somalia (which Dahabshiil denies).  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 ?
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Tracking terror finance and government follies: recommended reading

January 16, 2014
  • The recent designation by the Treasury Department of an Al Qaeda financier neglects to mention that he and his organizations have consorted with Yusuf Qaradawi, spiritual father of the Muslim Brotherhood… more>>
  • New details on the sanctioned Saudi billionaire in Turkey and the cover-up by Recep Erdoğan… more>>
  • Government forces the financial sector to do the lion’s share of work in screening for laundered or terrorist funds, but government doesn’t really want to hear financial institutions’ ideas on how the process could be improved, says industry analyst Tom Keatinge… more>>
  • Monitoring compliance with government financial regulations in a war zone in another continent is easy, right?  One expert explains why it isn’t, and how a UK court got it wrong on Dahabshiil… more>>
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Somali press blasts Mo Farah: shill for Dahabshiil

August 30, 2013

UPDATE—FEB. 28, 2015:

In October 2012, Dahabshiil commenced defamation proceedings in The Netherlands against Dahir Alasow (a Somali asylum seeker living in The Netherlands) in respect of various articles written by Mr Alasow and published on his websites including Sunatimes, Waagacusub and ASOJ. These articles alleged that Dahabshiil was, inter alia, involved in the financing of terrorism and other serious crimes, allegations which were categorically denied by Dahabshiil.

On 16 December 2014, the ’s-Hertogenbosch Court of Appeal of The Netherlands, following an extensive examination of the evidence, ruled that the articles were untrue and defamatory of Dahabshiil. Mr Alasow was ordered to remove various articles containing the defamatory allegations from his websites, publish a notice of rectification and pay Dahabshiil’s legal costs. The court’s decision can be found here:
http://uitspraken.rechtspraak.nl/inziendocument?id=ECLI:NL:GHSHE:2014:5351


When Barclays decided to end its partnership with Dahabshiil, a money transfer company that funds al-Shabaab, Olympic gold medalist Mo Farah condemned the decision, claiming that the families of Somali-Britons like his depend on Dahabshiil’s remittance service.

In turn, the Suna Times, an independent publication of Somali journalists, and Muqdisho News have condemned Mo Farah for misleading the world about the Barclays decision.

The Somali reporters point out 1) that Dahabshiil funds terrorism, as Money Jihad readers also know, 2) that other remittance alternatives separate from Dahabshiil are available to Mr. Farah and to Somalis around the world, and 3) that Mr. Farah belongs to the same tribe as the owner of Dahabshiil.

Mo Farah’s Scandal: Tribalism or Bribery?

London {Sunatimes} British-Somali Olympic gold medalist Mo Farah has started propaganda campaign, organized by the terrorist financier, Dahabshiil money transfer company.

Mo Farah spoke to the Guardian said “This decision (by Barclays Bank) could mean life or death to millions of Somalis.”He misled the British media by telling that he sends monthly upkeep expenses to his family back in Somaliland, and they’ll be in danger should Dahabshiil had been closed.

Mo Farah can send his money through world remit, which has cooperation with Zaad Service (MMT Service in Somaliland), an online money transfer service that can send money in five minutes. He has an alternative in sending money through other services which has not been affected by Barclays ban such as Kaah express, but it’s so unfortunate to see him spreading propaganda in favor of Dahabshiil.

Although Mo Farah hails the same clan of Dahabshiil proprietor, many Somalis wonder why he is in the middle of such a mess. His supporters believe that he hastily and blindly supported the terrorist financiers. He urged Barclays to lift the ban, and signed petition asking British government to put pressure on Barclays in his twitter account. He wrote a letter to PM Cameron urging him not to close Somali money transfer agencies, but in turn, his intention was to save Dahabshiil.

PM Cameron cannot save a company that has committed terrorist crimes; therefore the athlete should have saved his reputation, by trying to find out the truth.

Mo Farah should realize that Dahabshiil was behind the killing of Somali journalists, and intermingled the dirty politics in Somalia, and has been found guilty by a court of law in relation to their financial support with Al Shabab…

It is so distressing to see independent and expatriate journalists who are trying to save their country from the throes of terrorism be smothered out by institutional, corporate, biased media sources that simply will not print the truth about Dahabshiil.  The British media conglomerates have latched on instead to the glamour and star power of Mo Farah, while ignoring “lesser” Somali celebrities like Nimo Djama and Sado Ali Warsame, who have received death threats for speaking out against Dahabshiil.

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Financial mischief: recommended reading

August 28, 2013
  • Yemen admits that, left to their own devices, donors’ zakat will fund terrorismmore>>
  • Financial crime expert Kenneth Rijock affirms the decision by Barclays to stop doing wiring money to Somalia… more>>
  • After Goldman Sachs, GoDaddy, and NASDAQ snafus, maybe it’s time to acknowledge the threat of economic warfaremore>>
  • Will bitcoin be embraced beyond the anarchist fringe? Laundreymen author Jeffrey Robinson has his doubts… more>>
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Barclays severs ties with Somali wire service over terror finance, money laundering concerns

July 4, 2013

The international company in question is Dahabshiil—the same money transfer service that has exhibited worrisome shortcomings in its anti-money laundering and counter-terror finance compliance programs.  It is also the same company that has been subjected to alleged extortion demands from the terrorist group al-Shabaab in exchange for remaining in business in Somalia.

Thank goodness Barclays has acknowledged the warning signs.  Thanks to El Grillo for sending over this Jun. 25 article from the AP:

Terror financing fears stop transfers to Somalia

By ABDI GULED and JASON STRAZIUSO

Associated Press

MOGADISHU, Somalia (AP) — When a bank transfers money to Somalia, can it be sure it’s not sending money to terrorists? That question is forcing one of Britain’s largest banks to cut ties with the largest cash transfer bank in Somalia, a company that brings in the majority of the country’s $1.2 billion in yearly remittances.

Many in Somalia are in desperate need of money. Payments from family and friends overseas are how many get by, and that’s why more than 100 aid workers and Somalia experts signed a letter this week pleading with the British government to find a solution.

Barclays bank will no longer allow customers to send money to Somalia via the Somali bank Dahabshil. A financial power-house in Somalia, Dahabshil describes itself as “the most trusted money transfer company for many immigrants willing to support their families and friends.” But anti-terror laws hold banks – like Barclays – responsible if they transfer money to criminal or terror elements. As a result, fewer are willing to send money into Somalia.

Such transactions for Somalis in the United States became more difficult in late 2011, when a bank in Minnesota closed accounts that facilitated such transfers. Sunrise Community Banks decided to halt the transactions after two women were convicted of sending money to the terrorist group al-Shabab.

“It is recognized that some money service businesses don’t have the proper checks in place to spot criminal activity and could therefore unwittingly be facilitating money laundering and terrorist financing,” Barclays said in a statement. “We want to be confident that our customers can filter out those transactions, because abuse of their services can have significant negative consequences for society and for us as their bank.”

Abdirashid Duale, chief executive of Dahabshiil, noted that his company is one of a number of transfer businesses affected by of Barclays’ decision.

“Naturally, Dahabshiil is appealing this decision and would like to emphasize that to date Barclays’ has acknowledged that our Anti-Money Laundering and Anti-Terrorist Financing policies are fully compliant with industry regulations,” he said.

Dahabshiil, he said, remains operational while it explores alternative banking arrangements.

The group of aid workers and researchers said the decision at stake here “is a lifeline that provides essential support to an estimated 40 percent of the population of Somalia.” The group said it has seen firsthand the impact remittances have on families in the Horn of Africa.

“My son is in the U.K. He sent us money every month for our sustenance and school fees for the children. Where are we going to get the money to pay our bills?” said Dahabo Afrah, a longtime customer of Dahabshil in Mogadishu. “This is unfair to us and will affect hundreds of thousands of Somali people.”

Many big banks in the U.S. have already stopped handling transfers to Somalia, saying the federal requirements designed to crack down on terrorism financing were too complex and not worth the risk. Last April, U.S. Bank confirmed it is working with Dahabshil to allow Somalis in Minnesota to send money back home. U.S. Bank spokeswoman Teri Charest said Monday that the bank is working closely with Dahabshil but the transactions have not yet started.

Barclays said it remains happy to maintain a relationship with businesses that have anti-financial crime controls…