Wall Street Journal finally gets around to the story about banks refusing to send money to Somalia
Posted by Ann Corcoran on June 25, 2012
This issue has been around for months (we first reported the “crisis” last December, here), but I see it finally made the big time just last week when The Wall Street Journal reported the hot (not!) news here.
Efforts by U.S. banks to avoid violating antiterrorism financing laws are crimping the ability of Somalis in the U.S. to send money home, prompting calls for Congress to revisit bank regulations on money transfers.
Somalis in the U.S. use money-transfer merchants, informally known as “hawalas,” to send about $100 million annually to Somalia, according to the U.S. Treasury Department. The East African country, where there is no formal banking system, has been without a functioning government since 1991, when civil war erupted and forced tens of thousands to flee.
U.S.-based Somali hawalas, which are federally licensed, rely on banks to wire funds to their counterparts in Africa, who deliver the money to the designated recipients. But increasingly, U.S. banks say they are severing ties with the informal and opaque system to avoid violating federal banking regulations, such as anti-money-laundering rules.
Read it all if you feel like it.
Don’t you just wonder where Somalis are getting $100 million annually to send out of the country!
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