U.S. drive against al Shabaab pressures Somali-American money transfers

Reuters News
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Posted: Jul 30, 2012 10:46 PM
U.S. drive against al Shabaab pressures Somali-American money transfers

By David Bailey

(Reuters) - A Chicago man pleaded guilty on Monday to planning to join an al Qaeda-linked group in Somalia, the latest U.S. prosecution in a crackdown that has made it harder for Somali-Americans to send money to the war-torn country.

Shaker Masri, 28, was arrested in August 2010 as he prepared to leave the United States and agreed to serve nearly 10 years in prison, the U.S. Justice Department said.

The prosecutions of Masri and others since the Sept 11, 2001, attacks are designed to stop support to al Shabaab, a militant group the United States says has ties to al-Qaeda.

The campaign against al Shabaab has had a chilling impact on legitimate money transfers from the Somali-American community to relatives in one of the world's poorest countries, Somali-Americans said.

For more than two decades, Somalia has been ravaged by a civil war that has left the country with no functioning central banking system and an income per person only a little over $200 a year, according to the World Bank.

Somali-Americans in Minnesota and other states rely on small money services businesses to funnel money to their relatives in Somalia.

But many U.S. banks stopped hosting accounts for those businesses because U.S. laws, starting with the Patriot Act, made them potentially liable if money ended up in the hands of al Shabaab. The U.S. State Department designated al Shabaab a foreign terrorist organization in 2008.

Wells Fargo, U.S. Bank and TCF Bank stopped providing account services in recent years.

Sunrise Community Banks stopped at the end of 2011, and others have dropped out since, adding to the concerns of Somali-Americans in Minnesota, home to the largest Somali population in the United States at about 34,500, according to census data.

Maryama Abdi, speaking through an interpreter at the Karmel mall in south Minneapolis, said she sent up to $150 a month to family in Somalia using money transfer businesses.

People survive "because of the exchange connections and the money we are sending," Abdi said. "They can use it to buy milk."

SENDING $100 MILLION A YEAR HOME

U.S.-based Somalis send more than $100 million a year back home, according to the U.S. Treasury, mostly $100 or $200 at a time. The Somali government has estimated about $2 billion, or one-third of its gross domestic product, reaches the country through money transfer businesses.

As part of the crackdown on links to al-Shabaab, 18 people face federal charges in an investigation into funding and recruiting for al Shabaab in Minnesota, and several have pleaded guilty. About 20 men have left Minneapolis for Somalia to join al Shabaab since September 2007 and at least two of the men charged in the Minnesota investigation are believed to have been killed there.

U.S. Representative Keith Ellison, a Minnesota Democrat, supports legislation to reduce the regulatory burden on the banks for providing the money transfer services.

"The end goal is to shut down terrorist financing," Ellison said in a telephone interview. "The end goal is not to shut down American immigrant-owned small businesses."

About 17 banks across the United States still facilitate those transactions, Ellison said earlier this month.

The chairman of the Somali American Money Services Association, Said Malin, said his members were concerned about the uncertainty.

"People are rushing to come and send in money to loved ones," Malin said. "Every other month, they say this is the last month, or next month or the third month."

All 14 members of the association shut down temporarily after Sunrise stopped providing services at the end of 2011, but 11 were able to reopen using other banking sources, Malin said.

At Karmel mall, Faduma Alim said her whole family suffered if her sick eldest son did not receive the $150 or $200 she sends each month to care for him and his four children.

"That is how he survives," said Alim, who also sends money to support the six children of her deceased brother, who live with their grandmother. "It's the only banking system we have."

(Reporting by David Bailey in Minneapolis; Editing by Greg McCune and Peter Cooney)