Wednesday, January 11, 2012
Amina Hassan hasn’t felt this helpless in a long time. A refugee who
fled Somali 20 years ago and now an American citizen, the middle-aged
single mother can’t send remittances to her impoverished relatives in
Somalia anymore.
Hassan is one of thousands of Minnesota Somalis
who have despaired ever since the shut-down of Somali-owned money
services businesses (MSBs) in the Twin Cities two weeks ago.
“We want to support our people in the civil war. There’s sickness,
there are mothers and children dying,” she said. “We want to help our
kids. We want to help our people.”
Hassan has a sister and three
cousins in Somalia, aged five, six and nine. The children’s father - her
uncle - recently died, and the family is homeless, she said.
“They
don't know what to do. They live on money we send monthly to buy food,
and they will not have money next month,” she lamented. “We don't know
what we're going to do, we're just waiting for Allah, for God.”Hassan was one of about 200 mostly Somali and Oromo protesters
outside the State Capitol last Friday, January 6, demanding that the
state and federal government come up with a solution to allow Africans
in the diaspora to send remittances to loved ones in the Horn of Africa.
Sunrise
Community Banks, the last Minnesota bank to work with Somali-owned
money services businesses (MSBs), stopped transferring remittances
abroad on December 30. The Somali community has scrambled to figure out
alternatives ever since. “My community has been in chaos these
past few weeks,” said Hinda Ali, community organizer with the Somali
Action Alliance and board member of the Somali American Money Services
Association (SAMSA). “Everyone is in pain because they don't know what
they're going to do when the next month comes.”
Since they first
starting operating in the Twin Cities about 15 years ago, MSBs —
colloquially known as "hawalas" — have been the only option for Somalis
in the diaspora to wire money cheaply and efficiently to relatives.
Typical money-transfers, such as Western Union and Money Gram, don’t
operate in Somalia because the country has no functional banking system.
Somali-owned MSBs operate like a Western Union, but they can reach the
most remote places — refugee camps, villages, deserts — that other banks
can’t.
“Hawalas are everywhere, you can send money to China, to Australia,
and it will get there in 10 minutes. Guaranteed,” Ali said. She added
that Eritreans, Ethiopians, and Kenyans also use the system.
Somali
families typically send between $50 and $200 on a monthly basis to
support the livelihoods of relatives in the Horn, she explained. With
Somalia’s 20-year civil war and two famines in the past decade, the
hawala system has served as the lifeline for the Somali diaspora.
“People
[in Somalia] are surviving because of the little money they get from
the U.S. through the hawala,” said Ali. “For the diaspora to sustain a
country for that long through a hawala system has been proven
effective.”
Despite this, there have been growing fears that
Somali-owned MSBs may help facilitate terrorist activity abroad.
Concerns heightened after two Somali women from Rochester, Minnesota,
were convicted last October of sending money to the terrorist group
al-Shabab in Somalia.
As a result, banks in Minnesota, Ohio and
Washington State — all centers of Somali refugee population — have
stopped working with Somali-owned MSBs.
The closures aren’t new.
Most corporate American banks cut off ties with hawalas in 2005, after
Congress passed stricter banking regulations in a post-9/11 era. The
regulations designated MSBs as “high risk.”
Abdirahman Hassan (no
relation to Amina Hassan), an MSB manager and SAMSA secretary, said he
thinks the “high risk” designation is arbitrary. Somali-owned MSBs
operate like any other MSB, and require clients to provide
identification before wiring remittances, he said. Hassan also explained
that Somali MSBs pay insurance fees and have independent financial
audits, like any other MSB.
“It’s absolutely safe and we have
bigger scrutiny than even the big banks,” he said. “We're regulated by
the state and federal government, we comply with the Bank Secrecy Act,
we have anti-money laundering programs, we have licenses with every
state that we operate in, and we're 100 percent legal.”
From
Minnesota alone, $100-120 million in remittances is sent every month
through MSBs, part of a global two-billion-dollar industry, Hassan said.
He added that the term “hawala” is actually a misnomer, since hawalas
are informal businesses. Technically, hawalas don't even exist in
Minnesota, he said.
“Somali MSBs have been in the U.S. for almost
15 years and the only incident were those two ladies,” he said of the
Rochester women. “But, people can send illegal money to non-Somali
businesses, [too]. ... The difference is Somali-owned banks ... were
targeted.”
Others in the community are concerned the closures will hurt Somalia’s economy and trigger international hawala closures.
“[Banks
worldwide] will follow suit because the U.S. is the big player,” said
Abdiaziz Hassan, Somali Action Alliance communications director. “If the
U.S. closes, others will do the same.”
For Ali, an immediate concern is Al Shabab, which might use the closures as an opportunity for propaganda, she said.
“Al
Shabab is very well funded. People have nothing during a famine,” she
said. “If Al Shabab is the only group that can get them money, then, not
because of a principle but because of a need, they will join Al Shabab.
It's survival.”
“It's scary. It's crazy,” she added. “But we are working hard, with all levels of government. I just hope we find a solution.” Various policy makers and community leaders attended and/or spoke at the rally.
Congressman Keith Ellison (D-Minn.)
Representative Jeff Hayden (DFL)
Others who spoke at the rally:
Representative Karen Clark (DFL)
Sadik Warfa - Somali American community leader, 2011 state senate candidate
Sheikh Abdirahman, Sheikh Omar - Abu Bakr As-Siddiq Islamic Center
Sheikh Abdisalam Adam - Islamic Civic Society of American
Sheikh Ahmed Tajir - Masjid Ummatul Islam
Hamza Nasir - Oromo Minnesota community
Reverend Grant Stevenson - President of ISAIAH
Bashir Siyad - SAMSA president, MSB owner
Javier Morillo - President of SEIU Local 26 Union
Hashi Shafi - Somali Action Alliance Executive Director
Donna Cassutt - Minnesotans for a Fair Economy
Abdiwahid Qalinle - Professor, U of M Law School
Abdiaziz Sugule - SAMSA board member