http://www.bbc.co.uk/news/world-africa-16858818
9 February 2012 Last updated at 21:02 ET
'Lifeline' US-Somalia remittances on hold
By Paul Schuster and Dan Damon
Continue reading the main story Related StoriesIs Somalia's al-Shabab
on the back foot?Somalia fears end to US bankingSomalis face
remittances threat
Banks in the US state of Minnesota - home to a large ethnic Somali
community - have stopped money transfer services to Somalia, fearful
of prosecution under US anti-terror laws. But are ordinary people in
the country wracked by drought and conflict paying the price?
"It's really hard to go to work with a smile on your face because you
know your family is struggling - they don't have food on the table and
you're getting it," says Zahra Hassan, one of Minnesota's 32,000
Somali-Americans.
She lives in Minneapolis, which has the largest concentration of
Somalis in the US, so much so that it is sometimes called "Little
Mogadishu".
Continue reading the main story “Start Quote These kids, when they
don't have education, when they don't have food, what are they going
to do?”
End Quote Zahra Hassan Somali-American in Minnesota
Ms Hassan fled Somalia during the civil war in the early 1990s, was
granted asylum and is now a US citizen, doing two jobs.
She has not had a holiday in the 10 years she has been in Minnesota,
because she sends every spare cent she has to relatives back home.
Conditions in Somalia are desperate - the country has been devastated
by years of fighting, and is only just starting to emerge from a
drought and a famine.
Her family is big, and her mother divides the money out to the most needy.
"I'm the only source of income for my family," she says.
"The money I send basically covers shelter, food and education. When
someone gets sick, that's another cost.
"I feel it's my responsibility to take care of my family, because the
country is not taking care of them."
Hitting home
One of those to benefit from her hard work is her 18-year-old nephew
Abdullahi Hassan.
His family are nomads who live in the desert, but thanks to the money
he gets from Ms Hassan, he has been studying at a school in Hargeisa -
the capital of the self-declared republic of Somaliland, in
north-western Somalia.
The conditions are modest. He lives in a small apartment - so small
that he uses the kitchen as his bedroom.
Things were going well for him until just over a month ago when the
last major bank in Minnesota to offer money transfers to Somalia shut
down the service, fearful it could be prosecuted under US
anti-terrorism laws.
The shutdown on transfers has made life much harder for Abdullahi Hassan
US authorities are concerned that money sent to Somalia could end up
in the hands of al-Shabab, an insurgent group with links to al-Qaeda
which controls large parts of Somalia, and which is classed as a
terrorist group by the US.
"I used to get $100 [£62] a month from my aunt," says Mr Hassan.
"I had a reasonably good life, but now it's really difficult for me
because of the circumstances in America," he explains.
"I cannot pay my rent, I cannot pay for food or for school fees. I was
dependent on my aunt for everything - there is no other way for me to
get money.
"Now I have nothing. It's very difficult."
Mr Hassan had planned to study science at university. Now he thinks he
may have to return to live with his family as a nomad.
In the absence of an effective central government, Somalia depends
heavily on remittances.
There are estimated to be around one million Somalis in the diaspora,
and their contribution in the form of remittances makes up around one
third of the country's revenue.
Until now, around $100m per year was being sent in remittances from
the US alone.
Terrorist threat
In October 2011, two women in Minnesota were found guilty of
conspiracy to provide support to al-Shabab.
Evidence heard during the trial stated that they had sent $8,600 to
the group via money transfers.
Continue reading the main story Find Out More• The contributors here
all took part in a special edition of World Update broadcast from
Somaliland
Though they deny there is any direct connection to this case, the last
major bank in Minnesota offering services to Somalia stopped doing so
soon after, deeming the risk too great.
Federal authorities are not only concerned about money being purposely
funnelled to al-Shabab, but also the group's ability to intercept
funds once they arrive in Somalia.
"The likelihood of it ending up in the hands of al-Shabab or another
terrorist organisation is a distinct possibility, regardless of who is
identified as the end recipient," says Supervisory Special Agent EK
Wilson of the FBI field office in Minnesota.
There are no formal banks in Somalia, so the money transfers come in
via the hawala system - a traditional Islamic form of banking which
relies heavily on trust, and it is argued, is therefore more open to
abuse.
But there is a recognition within the intelligence community that the
bulk of funds sent by Somalis in the US to their country of birth is
aimed at improving the lot of residents there.
"The vast majority of that money is for legitimate, lawful purposes,"
says Mr Wilson.
"There are many hard-working Somalis here in Minneapolis who are just
trying to live the American dream and provide for their families.
"[But] the very small fraction of a percentage of that money that is
destined for al-Shabab could prove significant."
Lifeline cut
Ms Hassan used to send her money home via Dahabshiil, one of the
largest money transfer companies in the world, which has its operation
centre in Hargeisa.
It operates according to international banking rules - it is too big
not to, moving millions of dollars worth of remittances every month.
In his marble-clad banking hall, Dahabshiil chief executive
Abdulrashid Duale demonstrates the computer systems that, he says,
guarantee the transparency of the money flows he manages.
AdvertisementTake a look inside one of the largest money transfer
companies in the world
"Anyone who comes here to collect money has to show ID - two forms.
And they only come to collect the money because we have texted them -
that's another check, because we have their phone number."
Records of the transactions are stored and those records are available
to banking regulators, he says.
Mr Duale wants banks in the US to reconsider the shut down, especially
given the desperate humanitarian situation in Somalia.
"There is a drought, there is a famine... We are still negotiating
with the banks, and I hope there will be a way to get through this
because this is a lifeline."
Some small sums are still getting through he says, like $20 or $50.
But it is not a sustainable situation and - he argues - the clampdown
on money transfers will ultimately lead to less transparency, not
more.
"In one way or another Somalis will get money back to here. But it's
going underground and black-market.
Money can be transferred across the world in as little as 15 minutes
With the big drop in money getting through from the diaspora in the
US, this could - it is argued - foster frustration and resentment.
"We are going to create more people against the United States,"
believes Ms Hassan.
"These kids, when they don't have education, when they don't have
food, what are they going to do?
"Al-Shabab may ask them to do jobs for them - are they going to say, no?"
Her nephew chips in: "I'm not really resentful, I'm not angry at the Americans.
"But life is very difficult. I don't know what I am going to do."
Paul Schuster was reporting from Minneapolis and Dan Damon from
Hargeisa, Somaliland. Video production by Matthew Danzico and Jacques
Sweeney
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Received on Fri Feb 10 2012 - 10:03:22 EST
