The Anatomy of an Alms for Jihad Transaction

Zakat, a legitimate Sharia tax can be used for many different things, including alms for the poor and even paying a Mujahadiin's expenses. To the payer it is simply a mandatory religious tax on money left in the bank. Many of these funds are rerouted (called money laundering) and used to pay for terrorism.

Someone fighting a" religious cause" or Holy war is a legitimate candidate for Zakat funds under Sharia law. The following is a hypothetical anatamoy of what an alms for jihad transaction looks like:

• A Jihadist logistical leader hunts down wealthy or well connected Ikhwans, (Muslim Brotherhood) believers who are ideologically aligned with a particular Jihad.
• They meet them on line, at conferences, through funding Brokers (UBL brokered deals like this at high levels, for example the Golden Chain List).
• They come to agreement about funding. The Funder need not be aware of the details of what the funding is for as long as he gets credit for the Zakat religious taxes they owe in accordance with Sharia.

• Then they transfer the funds using a Hawala or remmitance company. For example, a not-so-hypothetical funder in UAE agrees to fund a Mujahadeen group in Northern Nigeria, Somalia, Cameroon, Western Sahara, or even the new country of South Sudan.

The Zakat transaction recorder gives the name and number of one or more of his independent Hawala agents to the fund provider who is located in the funder's country, in this case, the UAE.

• The Agent looks up an agent in the receiving country from his agent directory, or more likely is given a preferred agent by the terrorist logistician in the country where the funds are needed; in our example, Northern Nigeria,
• The Sending Hawala Agent calls the receiving Hawala agent, and they make a deal.
• They then call the Hawala Agency, in our example, Dahabshiil (based in Somalia) and the Agency agrees to back the transaction.
• Dahabshiil is supposed to ask questions about what the transaction is for. In our example, the sending Independent Hawala Agent tells the agency that he thinks it is for "farm equipment".
• The Funder gives the funds to the sending Independent Hawala agent. The agent charges a 4% commission for the transfer. He keeps 25% of the commission, the agency (Dahabshiil in this case) keeps 50% of the commission, and the receiving Independent Hawala Agent keeps 25% of the commission.
• There are many transactions like this a month, and Dahabshiil settles up with the Independent Agents by receiving and paying the funds out in Aggregate every week or month.
• The terrorist in the receiving country gets a phone call with an agent's contact information if needed, and a transaction code number.
• The Terrorist goes to the receiving agent in Northern Nigeria and gets the cash.
• The funder takes his Zakat religious tax receipt for "farm equipment"from the sending Hawala back to the Zakat accountant - he may never know to whom his Zakat is going, or what it is used for. This is permissible under Sharia.

The steps in this process provide deniability for terrorism support at every level. It may be true that someone thought their zakat funds were going for the medical needs of children, and they were actually used to buy an explosive vest used by a child.

• The funder could say they did not know the funds were for a child's explosive vest
• The Sender could say they did not know the funds were for a child's explosive vest
• Dahabshiil could say they did not know the funds were for a child's explosive vest
• The receiver might say they did not know the funds were for a child's explosive vest
• The fund user could say he did not know the funds were for childrens' medical needs, and he buys the child's explosive vest.

Only one person commits the crime, but no one else in the process accepts responsibility for equipping the war criminal to use a child as a bomb.

Note: Dahabshiil is used as an example. There are many many Hawalas in almost every country on earth. Dahabshiil and its leaders were severely sanctioned after 9-11 for a history of unaccountable transactions.

Since that time, they have taken steps to mitigate the process and many sanctions against Dahabshiil have been lifted by the US. This global corporation has taken strategic steps to look more like a bank, but every day diaspora around the world send money home to their families and clans using the Hawala system... And some of those transactions fund terrorists.

The following posts from a discussion among Hawala

Alms Still Funding Jihad

Saudi Arabia implemented a number of financial controls by 2004 in response to 9-11.

Many of these measures would be against the law in the US, but the measures (See below) show ways that Salafist Mosque donations were being funneled to al Qaeda and other islamist groups.

Cash collections in Mosques were being taken to Hawalas in Saudi Arabia. The money was being picked up in places like Yemen, India, Pakistan, Iraq, Afghanistan Somalia, Sudan, Algeria. It was very simple to collect for one thing, and then pay for another in a Jihad Country. Many contributors may have know full well what the funds were collected for, with a wink and a nod.

It was even simpler to do this from Western Mosques. Though some Muslim Charities were put out of business since then, and it has become harder to create non-profits and transfer funds, it is not impossible. Suffice it to say that there are still loopholes.

Things to watch:

• cash gift card purchases
• Visa cards issued by jihad friendly banks, especially in South East Asia
• Planned captures of ships off the Somali coast
• Legal Hawalas
• Hawala house accounts in Banks in places like San Marino, Lichtenstein, the Bahamas etc.
• Multi-national Jihad-Friendly Muslim businesses in a variety of ways

There are a long list jihad-friendly multi-national Muslim NGOs who provide funding. While a volunteer travels for that Muslim NGO, they legally can use hawalas to transfer in large amounts of cash that they can use anyway they choose.

-Shimron Issachar

'Department of the Treasury official have listed various recent measures

taken by Saudi Arabia to put a stop to terrorist financing. Most of these measures

have been designed to improve oversight of charitable collections, and include:

• A law adopted in August 2003 making money laundering and terrorist financing criminal offenses.
• A ban on cash collections at mosques and on transfers abroad of charitable funds collected in Saudi Arabia, except with Foreign Ministry approval and subject to stringent reporting requirements.
• A requirement for charitable organizations to have single disbursement bank accounts and an approved official with signatory authority to facilitate tighter controls over such accounts.
• Closure of unlicensed money exchange houses and closer supervision of informal money transfer houses used to send funds abroad, known as hawalas.
• New rules governing the insurance sector and capital markets, and establishment of a financial intelligence unit (the SAFCU) to collect and share information on suspicious financial transactions.

• Vetting of religious clerics and supervision of money given to them by their congregations. The government suspended more than 1,000 clerics in 2003 and 900 clerics so far in 2004 supposedly “on the grounds of negligence.”
• Announcement in early December 2003 of a rewards program, ranging from $270,000 to $1.87 million, for information leading to the arrest of suspects or disruption of terrorist attacks.
• Announcement in late November 2004 that Saudi Arabia will participate in the newly established Middle East and North Africa Financial Action Task Force (MENAFATF).
• Membership in the regional body commits Saudi Arabia to implementing the internationally recognized anti-money laundering and counterterrorist financing standards designed by FATF."

-Congressional Research Service Report, 2004

Money Laundering Update

A review of FATF news shows that Argentina has not made adequate progress in preventing money laundiering from known sources, and new payment methods (NPM) are being abused more frequently as traditional measures close up.

The full report of FATF’s third mutual evaluation of Argentina (and second joint FATF/GAFISUD evaluation of Argentina) is now available for download, the executive summary was published on 5 November 2010. Since the last evaluation, finalised in June 2004, Argentina has not made adequate progress in addressing a number of deficiencies identified at that time, and the legal and preventive AML/CFT measures that are in place lack effectiveness.

Download the report (2.3Mb)

This report is builds on the 2006 Typologies report on New Payment Methods (NPMs). Since 2006, there has been a significant rise in the number of transactions and the volume of funds moving through NPMs. Consequently, the number of discovered cases where such payment systems were misused for ML/TF purposes has also increased.


This report compares the "potential risks" described in the 2006 report to the "actual risks" based on new case studies and typologies. The report also describes a number of indicators of suspicious activity. These red flag indicators will help NPM service providers and other financial institutions to detect ML/TF activities. The report describes the challenges presented in developing appropriate legislation and regulations for NPMs and the different approaches taken by national legislators and regulators.


The New Payment Methods report is the result of analysis of questionnaire responses and publications about NPMs as well as input by relevant private sector representatives such as NPM service providers, including the

• Internet payment sector,


• the mobile payment sector


• prepaid card technology providers.

The report will be made available on the FATF website within the next few weeks.

The Rest @ FATF

Justice and Equality Movement (JEM) Leaders Captured by Milita, Given to goS

2:08 AM (20 hours ago)
Darfur JEM says government forces captured some of its officials

from Sudan Tribune: Plural news and views on Sudan by SudanTribube.com
January 15, 2011 (KHARTOUM) – The Darfur Justice and Equality Movement (JEM) said that government troops ambushed its forces and managed to take into custody a number of its senior officials.

"Three days ago, a mobile administrative unit belong to JEM was touring the villages of Abu Jurouj, Bir Saliba and Garji Garji in west Darfur, close to El Geniena city. The unit was ambushed by a government force and its associated militia" said a statement by the rebel movement and signed by its military spokesperson.

JEM said it fought its way through the ambush but that some of its members " lost their way and were captured by militia affiliated to GoS " [government of Sudan]

"The militia bargained for a ransom from JEM in the same way they do against their western captives and ended up handing over their captives to GoS".

It gave the name of the captives as

1. Commander Al Maz Deng, Deputy President of JEM and Secretary for Southern Sudan Region.
2. Sir Gibriel Tia Kuku, Political Advisor to the President of JEM
3. Mahjoub Jazouli Izzalarab, Deputy Head of JEM Administration and Organization, Darfur Region.
4. Abdalla Abdalla Hasan
5. Yahia Abbaker Musa
6. Abdalla El-Tom Abdalla
7. Yahia Babikir Daldoum
8. Musa Omer
9. El Rasheed Ahmed
10. Mohamed Balla
11. Ibrahim Adam
12. Abdalla Khamees

"These heroes are now prisoners and are entitled for treatment in accordance with international conventions. JEM expect them to remain safe and will not hesitate to retaliate, if mistreated by their captors" the rebel group said.

The Sudanese army confirmed the incident saying that it transferred a number of JEM figures to Khartoum after being arrested west of Jebel Moon after a chase that lasted for 67 km North of El Geniena

Last month, JEM clashed with Sudanese army south of El-Fasher, historic capital of Darfur and was reportedly joined by other rebel groups including one that has signed a peace agreement with Khartoum.

The Rest @ Sudan Tribune

Roman Ring Smuggle Mujahadin to Europe using Hawalas

Rome. Italian police said Wednesday they had arrested 26 suspected members of a gang operating in Rome Internet cafes that smuggled hundreds of Afghans into Europe including possible Islamist militants, AFP reports.

Two more suspects had been taken into custody in France and Germany."Some of those being investigated are suspected of involvement in international terrorism," Piero Saviotti, a prosecutor in Rome, told reporters.The gang was made up mainly of Afghans, Kurds and Pakistanis and used the hawala money transfer system popular in the Middle East and North Africa.

Up to 200 Afghans including some 40 minors were brought into Italy and on to other parts of Europe every month by the gang, investigators said.The immigrants came mainly from the Afghanistan-Pakistan border and were brought to Italy through staging points in Iraq, Iran and Greece.

The Rest @ Focus Fen

IFTIN Part 2

IFTIN is more than just a Somali based international trading organization. It is a:

Digitial TV Network:

• News
• Hawala Money Transfer Company
• US- Based Islamist Promoting Charter School

There is a Sonmali Music Group called IFTIN, but I am unaware of a direct association with a IFTIN corporate.

More to Follow on names associated with IFTIN

-Shimron Issachar

This was originally published in the Christian Science Monitor August 26, 2009

The Somali enclave of Eastleigh in Kenya's capital, Nairobi, is now a recruiting and financial center for hardline Islamists fighting in neighboring Somalia.

The streets of Eastleigh, a Somali enclave of Kenya's capital, Nairobi, are crowded and dirty. Sewage and rotting garbage flow through gullies. Police are virtually nonexistent; restaurants are locked, even when open, for safety reasons; and guns are readily available for sale at the market. No one ever said "Little Mogadishu" was paradise, but now the sprawling neighborhood has become a hub of financing and recruiting for militant Islamists waging holy war in neighboring Somalia, according to residents, security analysts, and diplomats.

"Those who kill people in Somalia are also here – scattered all over the place," says an elderly Sufi Muslim sheikh matter-of-factly. "This is the hotspot of the Somali fundamentalism.... They are recruiting right here in Nairobi."

In the latest chapter in a civil war that has raged since 1991, Somalia's radical insurgents this week rejected the Western-backed transitional government's call for a cease-fire during the Muslim holy month of Ramadan. Militant and moderate Islamists are battling for control of the rubble-strewn streets of Somalia's capital, Mogadishu, fighting that has forced more than 1.4 million people to flee their homes and caused what the United Nations on Wednesday called the country's worst humanitarian crisis in 18 years of war.

But here in Eastleigh, the war takes a different form. Little Mogadishu has become a port through which Somali insurgents raise money and recruit fighters, especially for the militant group, Al Shabab, which has been labeled an Al Qaeda-linked terrorist organization by the US government.

"What we know is that Al Shabab is very popular in Eastleigh," says Roland Marchal, senior research fellow at the Paris-based National Center for Scientific Research. "Al Shabab has been able at different moments to bring a number of people in Eastleigh to fight in Somalia. It's very likely that a number of economic operators in Eastleigh try to collect money and support this organization."

Why young Somali-Kenyans join militants Outside a small green-gated home in Eastleigh, the elderly sheikh – who declined to be named due to the grave threat to anyone talking about Somali militant operations – says agents of Somali insurgents have recruited from across the country dozens of Somali-Kenyans, most in their early 20s, who are missing and presumed dead in Somalia.

Though their parents were moderate, a lack of employment or alternatives led them to become students of madrassas (religious schools), where they adopted more extreme ideologies, he says.

Estimates of the number of recruited Kenyans range from dozens to thousands, most – but not all – Somali-Kenyans. The insurgency benefits from an effective recruitment network that works out of Eastleigh. Diplomats say recruiters use a combination of money and brainwashing to pull in the youths, many of them from refugee camps and areas along the Somali border. "

These young men have no ID papers, no future," says the sheikh. "The only future they see is blowing themselves up and going to heaven." Insurgents in Somalia are increasingly relying on suicide bomb attacks in their offensives.

One woman, the sheikh says, lost her 12-year-old son. She went looking for him in Somalia's southern port town of Kismayo, under insurgent control, and found him training to be a suicide bomber. She returned home emptyhanded. "If she'd tried to bring him, she'd be killed," the sheikh says.

In Somalia, moderate Sufis, belonging to a traditionally peaceful group called Ahl al-Sunna wal Jama'a, have taken up arms to defend their vision of Islam against militant groups, like Al Shabab, that are not only fighting the government, but also desecrating Sufi graves and attacking their more moderate views.

In Kenya, Sufis are also fighting back, but not with guns. Instead, they are trying to keep their children alive through a "counterjihad." "We are trying to teach our children at home. We don't even send them to madrassas.... We don't trust [the madrassas] with our children," says the sheikh.

"If they knew you were writing this, you'd go back without a head."

How money flows through Eastleigh According to a regional analyst who has studied Somalia for nearly two decades but cannot be named because his work is too politically and diplomatically sensitive, up to $3 million passes through Eastleigh to Somalia every year. The money comes from businessmen who support the insurgency, from mosques that fundraise, and from foreign donors who sometimes funnel it through Eastleigh.

Using an informal money transfer system called hawala, Somalis in any part of the world can make money available in Eastleigh within minutes.

From there, it can be carried north to the porous and badly guarded Kenya-Somalia border. The cash funds anything from guns to fuel to uniforms. The transfers are hard to track, Mr. Marchal says, because they are generally small payments that do not attract much attention. But money also gets to Somalia in other ways.

He lays out an example: Sympathizers of insurgents knowingly buy sugar from certain vendors in Kenya. They send that sugar to Somalia, where it is resold. None of these activities are illegal, but "then the money disappears," Marchal says. "It's very efficient.... There is no profit, no fee.

[All the money] goes to the organization. This is untraceable for anybody." No entity in Eastleigh has been under more suspicion than the Sixth Street mosque, a small, unimposing building on top of a FedEx shop, hidden among laundry-cluttered balconies.

The mosque is among Al Shabab's main fundraisers in Eastleigh, according to a Nairobi-based official of the African Union (AU) peacekeeping force in Somalia who spoke anonymously because he is not authorized to talk to the media.

"Sixth Street mosque has a history of supporting militant Islamist causes in Somalia since 1991," says the regional analyst. Its leader, Sheikh Umall, has called the Somali government an "infidel government" and a "puppet of foreign interests," he says. But knowing he is a person of interest to the US, Kenya, the AU, and the UN, Umall has sung a more moderate tune in recent months.

Fighters without borders Unconfirmed numbers gathered by the Institute for Security Studies in Kenya suggest that as many as 1 in every 10 refugees crossing the border from Somalia into Kenya are members of Al Shabab, which has used severe forms of sharia, or Islamic law, such as amputating the hands of thieves and stoning women accused of adultery.

Al Shabab uses Eastleigh to treat its wounded and run madrassas, from which children often disappear, says the AU official. "They have agents who are here, who brainwash these kids, who end up going there [to Somalia to fight]," he says. "It has become problematic." The AU and UN say Somali-Kenyan recruits are joined by others from Rwanda, Tanzania, Uganda, even the United States and Europe – many of whom enter Somalia through Nairobi, according to analysts.

Until recently, you could get a fake Somali passport in Eastleigh's Garisa Lodge mall in minutes.

Government plays down Eastleigh concerns

In June, the Kenyan newspaper Daily Nation reported that a Kenyan named Saleh Ali Saleh Nabhan leads a group of 180 foreigners in Somalia, called al-Muhajirun, fighting alongside the Somali insurgents and connected to the global terrorist group Al Qaeda.

But the Kenyan government denies there is much of a problem. "We don't believe Kenyans have gone to Somalia or have been recruited to go to Somalia," says Alfred Mutua, the Kenyan government spokesman. "We received reports of attempted recruitment, [but] ... because of our security apparatus, we've made it impossible for them."

In late 2006, when Ethiopian troops invaded Somalia to overthrow Islamists who had taken over, Kenya took precautionary measures, he says. It closed its border with Somalia, allowing only aid workers to enter Somalia from Kenya. The border is heavily patrolled by police, military, and helicopters 24 hours a day, and the government is using satellite technology to monitor vehicles crossing it, says Mr. Mutua. Reports of recruitment are "mere speculation," he adds, as Kenya has used "very high intelligence" to infiltrate the Somali community and disband any recruiting circles.

Kenyan police spokesman Erick Kirathe says Eastleigh is under high surveillance – both overt and covert – because it is a poorer, more-crowded neighborhood where crime is more likely. "It is much better policed than is apparent," he says. "Even visibly, there is much more police presence than in other areas." Because the attention it has received makes it unappealing to terrorists, he argues, Eastleigh is not as threatening as people think.

Mr. Kirathe says no one has been arrested for supporting the Somali insurgency, and "we really don't consider Eastleigh a major risk as of yet." "It's a point of concern," Mutua adds, "but we feel that we've got the situation under control."

Others beg to differ Some observers strongly disagree. They say recruitment in Kenya is longstanding and widespread. "We all know it's happening," one diplomat in Nairobi says, adding that the Kenyan government is unable or unwilling to stop it. The border may be officially closed, but even Mutua admits people are able to sneak through. But sources say the Kenyan government is beginning to take the threat more seriously. "They are panicking," the diplomat says. "They were not doing their best. Now the threat to Kenya is higher than ever. They have to do something." It seems the government is starting to feel that way, too. But it remains divided. Prime Minister Raila Odinga and Foreign Minister Moses Wetangula have called for sending in troops, as Ethiopia had done, to defend the Somali government. "It will be most inappropriate and inadvisable to do nothing when our national security and regional stability is threatened," Mr. Wetangula said recently.

Authorities fear a backlash But with hundreds of thousands of Somalis living in Kenya, strong involvement by the government and any taking of sides could expose Kenya to a big risk.

Insurgents have already threatened to retaliate within Kenya if attacked. "There's a reluctance to really mess with the Somalis," the regional analyst says. The fear is not only on the political level. Insurgents are perceived to have such a presence in Kenya that even average citizens are wary of providing authorities with information on their operations.

In Nairobi, activists who speak out against Somali extremists are threatened. "Because I'm not one of them, then I'm on the other side," says a Somali civil society activist who goes by the name Madobe. He calls the Somali Islamist movement a "cancer spreading very fast," and the insurgents "sub-human." He believes they are tapping his phone and e-mail. "Anytime, I expect a very big knife in my back."

Source The Christian Schince Monitor, by way of Horufahdi.com

Hawala and bank Dahabshiil - Abdirashid Duale How It Works

What follows is an excerpt from an interview of Abdirashid Duale, the founder of Dahabshiil. It was published by Somaliland Express on 09/09/09.



-Shimron Issachar

What makes you different from the other money transfer service providers like Western Union and Money Gram?

We are totally different from Western Union and Money Gram because we are inexpensive and oriented towards business as well. Dahabshiil like the other international money transfer services is a truly global operation providing a broad range of financial services to businesses both large and small and international organisations as well as the private individuals. We also operate under full banking licenses in a number of East African countries and are expanding this aspect of our business month on month.

• We have 1,000 branches and agents in over 40 countries around the world and international offices in London and Dubai.
• We have offices in 18 states in the US. We are the leading financial services organisation in the Horn of Africa. We focused on the quality of service.
• We can transfer as much as a business man wants within seconds while our competitors may take some time. Our services are internet based like theirs but we put a lot of emphasis on the time factor.

The other difference we have from them is that we allow our customers to negotiate with us. A person sending US $100 to the US or UK will only pay $2 as service fee and when it is an inland transaction say sending money from Kampala to Arua, $100 will be sent for less than $2. We aim at serving more people while charging less so as to earn more.

The Rest @ Somaliland Express

Lashkar-e-Taiba (LeT) Money Laundering Scheme Exposed

Srinagar, Oct 8 (IANS)

A money laundering (hawala) racket run to fund the Lashkar-e-Taiba (LeT) seperatist group was busted in Jammu and Kashmir, a police official said Thursday.
On a tip-off, police arrested a trader from the uptown Hyderpora locality of Srinagar a few days back, the official said.

“During interrogation, the trader revealed that he and his accomplices in Jammu and Amritsar (in Punjab) have been running a hawala racket to fund LeT cadres,” the officer told IANS here.

On the revelations made by the trader, police have also arrested a trader in Jammu and another in Amritsar, he said.

“The arrested traders had been taking a 40 percent cut for running and supporting the racket and passing on the other 60 percent to LeT militant group,” the officer said.

According to police, traders would receive pulses and other goods from Pakistan-administered Kashmir through the Line of Control (LOC) and sell the received merchandize here without sending any goods in return. The trade along the LoC is on a barter basis.

The Rest @ The Indian

Hawala By Mobil Phone?

Earlier this week I had an opportunity to speak with Zahir Khoja, Executive Director - Mobile Money (M-PAISA) at Roshan. As the world’s focus turns once again to Afghanistan during the country’s elections process, I wanted to get Zahir’s perspective on launching mobile money in this complex environment.

The challenges in the country are well known, but Zahir was quick to highlight the opportunities that come with advancing financial inclusion and developing important communication and payments infrastructure as the country rebuilds.

Paul Leishman: Zahir, can you start by providing us with a 10,000 ft view of M-PAISA in Afghanistan?

Zahir Khoja: We re-launched our service in October, 2008. When we piloted M-PAISA in Afghanistan, the idea was to bring a service to customers to repay their microfinance loans and serve those who didn’t have access to a bank because of distance. We created a trial partnership with First Microfinance Bank Afghanistan (FMFB) and today have about 5,000 customers using the service for microfinance loan repayments. From there, we moved the product into something similar to what you’d see in Kenya today - customers have the ability to send money, pay bills, receive salaries and buy Roshan airtime.

Over the last few months we’ve analysed our business and number of factors emerged. The first is that our tariff schedule was tiered and not easily understood. As a result, in August we launched a new tariff schedule which simplifies everything for the customer: sending money is now one flat fee regardless of how much a customer sends and the same goes for withdrawals. This simplifies the service for the average customer, who typically doesn’t have much education and 75% of whom are illiterate.

Paul Leishman: Where does M-PAISA stand by way of adoption today?

Zahir Khoja: Each month since launch we’ve seen an increase in gross registrations. As customers are interested to learn more about the service, the challenge of driving education still exists.

Paul Leishman: So your offering includes money transfer, MFI loan repayment, salary distribution and airtime purchase. What types of market conditions or customer needs were taken into account when designing this offering?

Zahir Khoja: First, we considered is access to finance. When you look at what Afghanistan has to offer today in terms of a banking environment, only about 3% of the population are banked and there are about 300 bank branches which are owned by 17 banks. So most of the country doesn’t have access to financial services unless you’re in a large city, and even those who do have access generally don’t trust banks given the history they’ve had with them over the last 20-25 years. We also considered the transportation infrastructure.

It’s very hard to get around in Afghanistan: roads aren’t developed like they are in Europe or North America, and buses or cars aren’t as common: donkeys or walking are often the preferred mode of transportation here.

The third factor we considered is security. When you’re travelling with large sums of cash, and when I say large I mean $100 or more, you stand the risk of meeting someone on the road who wants to take your money. In the last 6 months of 2008, there were about $30 million in transit robberies.

There are a lot of obstacles in Afghanistan, but these do vary in severity depending on where you are in the country. Take Southern Afghanistan for example, where the rules of engagement are different than what they may be in the North, it’s not safe to walk around there with money or conduct business. For women in particular it’s a lot easier for them to have a business in Central or Northern Afghanistan than it is in the South due to instability.

Opening up the movement of money is the first step to financial inclusion and alleviating poverty: that’s where the money transfer offering comes into play.

P2P payments break down boundaries between different villages or communities so that people can expand their trading partners.

The second thing is that these customers now have access to are microfinance loans without actually having to visit a specific bank branch. They can repay their loan by changing cash at an agent.

Once they take a microfinance loan, they’re probably using it to develop their business. If they’re developing their business they’re employing more people. If they’re employing more people they’re probably generating more revenue.

Through all of this comes savings, which will probably be the next thing we explore: once these people have money they want somewhere to put it other than under their pillow. You can see that over 10-15 years all of this plays into making the community self sufficient and alleviating poverty. At Roshan we don’t just look at products from a commercial perspective. We also consider economic and personal development perspectives and they were obvious in bringing M-PAISA to market in Afghanistan.

Paul Leishman: We read a lot about the challenges facing Afghanistan as the country rebuilds and stabilizes. What’s your on-the-ground assessment of the opportunities and challenges of doing business in the country?

Zahir Khoja: Security is clearly a major issue: it’s hard to ask an agent to walk around in the field and talk to people about mobile money. If you look at some of the activities we’ve had over the last 60 days, they’ve been limited or non-existent due to the election. Also, because of some of the political issues and the war in the country, we face security challenges with a number of our sites which are located in the volatile South. With an interruption of service, someone can’t check their balance. When someone can’t check their balance they freak out. These are the types of challenges we face operating in Afghanistan.

Another major challenge is that of building a team - specifically from an agent perspective. The approach to team building is very different here than most developed countries. Like many emerging markets, Afghanistan is very transactional - ‘if I give you a dollar, you give me a good’ and that’s the end of our relationship. The idea of ‘customers for life’ doesn’t really exist here. This plays out in recruitment of agents.Paul Leishman: What would be your biggest barrier to scale or growth at the moment?

Zahir Khoja: Development of our agent network. The reason I say that is because getting agents to invest in the business so they can keep a float balance isn’t easy. Agents look at this and say, ‘well that’s $500 that I could use to do something else with.’ As I said, the country is very transactional (i.e. give me a dollar and I’ll give you a good). What we’re asking agents to do is put $500 into float and manage that as your business grows with the customer base. They’ll see returns on the money, but it would be over a period of time. That concept is hard for agents to understand. The concept of sending money over a phone also doesn’t yet register with an average customer. When we talk about getting agents to explain this to customers, agents look for the quick hit. They look for opportunities to maximize commissions today, which makes education really challenging.

Paul Leishman: MFIs play an important role in your model. What advice would you offer around selecting and working with MFI partners?

Zahir Khoja: MFIs are looking at this from an expansion perspective as well as a cost reduction perspective. They can now send a loan officer out into a village and sign up customers to MFI loans. Their loan officer then disburses the loan on site. The customer knows where the village agent is, and is able to make their payments. These are people who may never have considered getting an MFI loan because they a) might not have known about it, or b) the distance to an MFI was too hard. So we’re giving the MFI an opportunity to get more customers and customers the opportunity to access financial services. In the future, we’d like to integrate all of the MFIs on the M-PAISA system so the back end functions more efficiently.

Paul Leishman: What are the unique things that a mobile operator can contribute to an MFI?
Zahir Khoja: First, I think it’s the ability to communicate with customers using various communication channels offered by Roshan. Second, MFIs now have an ability to look at a customer’s transaction history - do they make loan payments, do they qualify for incentives, etc. In Afghanistan, we don’t have a credit bureau, so there’s no way of checking if someone is a good or bad applicant. This allows the customer to develop some type of credit history, and allows the bank on the other end to give $1000 instead of just $100 because they know that they’re dealing with a good customer.Paul Leishman: What’s been your experience from a regulatory perspective launching M-PAISA in Afghanistan?

Zahir Khoja: Mobile money products are a brand new concept to Afghanistan. Roshan, along with USAID, World Bank, CGAP and many other entities are working very closely with the Central Bank of Afghanistan (the regulator) in the development of new regulations. Best practices from Kenya, Philippines and other countries where mobile money has been successful are being taken into account.

Paul Leishman: Does the Central Bank see opportunity in gaining better visibility into financial flows in Afghanistan?

Zahir Khoja: Yes. One of the things the Central Bank asked us is ‘how can you be sure that criminals, won’t use this system?’ We have an Anti Money Laundering Officer that monitors transactions on a daily basis. Any transactions that look suspicious is flagged immediately. This enables the Central Bank to deal with these matters instantly rather than waiting for the outcome of what these funds would be used for.

Paul Leishman: What about other elements of regulation. Can non-bank agents perform account opening and cash in/out? Is there proportionate KYC in Afghanistan?

Zahir Khoja: To open an M-PAISA account, you need to have a valid passport, or a national ID card. You also need to have 2 colour photographs, name, fathers name, birth date, mobile phone number. We also ask whether the applicant is involved with any political party or if they’ve ever been involved in terrorist activity. All of our customers are screened through various sources, like the Dow Jones watch list, to make sure that applicants are legitimate.


Paul Leishman: What types of tactics do you use to convert registered customers into active users?

Zahir Khoja: There are a number of tactics, but the primary one is educating and training M-Paisa agents so that they are well equipped to talk to customers about the service.

That’s our main focal point. There are also a number of marketing initiatives utilizing the Roshan mobile network that we use to communicate with customers. The marketing services we deploy take into account the fact that 75% of the Afghan population is illiterate. These types of initiatives have been recently launched so we are still in the process of evaluating their effectiveness.

Paul Leishman: So your offering includes

• money transfer,
• MFI loan repayment
• salary distribution
• airtime purchase.

What types of market conditions or customer needs were taken into account when designing this offering?

Zahir Khoja: First, we considered is access to finance. When you look at what Afghanistan has to offer today in terms of a banking environment, only about 3% of the population are banked and there are about 300 bank branches which are owned by 17 banks. So most of the country doesn’t have access to financial services unless you’re in a large city, and even those who do have access generally don’t trust banks given the history they’ve had with them over the last 20-25 years. We also considered the transportation infrastructure.

It’s very hard to get around in Afghanistan: roads aren’t developed like they are in Europe or North America, and buses or cars aren’t as common: donkeys or walking are often the preferred mode of transportation here.

The third factor we considered is security. When you’re travelling with large sums of cash, and when I say large I mean $100 or more, you stand the risk of meeting someone on the road who wants to take your money. In the last 6 months of 2008, there were about $30 million in transit robberies.

There are a lot of obstacles in Afghanistan, but these do vary in severity depending on where you are in the country. Take Southern Afghanistan for example, where the rules of engagement are different than what they may be in the North, it’s not safe to walk around there with money or conduct business. For women in particular it’s a lot easier for them to have a business in Central or Northern Afghanistan than it is in the South due to instability.

Opening up the movement of money is the first step to financial inclusion and alleviating poverty: that’s where the money transfer offering comes into play.

P2P payments break down boundaries between different villages or communities so that people can expand their trading partners. The second thing is that these customers now have access to getting a microfinance loan without actually having to visit a specific bank branch. They can repay their loan by changing cash at an agent.

Once they take a microfinance loan, they’re probably using it to develop their business. If they’re developing their business they’re employing more people. If they’re employing more people they’re probably generating more revenue. Through all of this comes savings, which will probably be the next thing we explore: once these people have money they want somewhere to put it other than under their pillow. You can see that over 10-15 years all of this plays into making the community self sufficient and alleviating poverty.

At Roshan we don’t just look at products from a commercial perspective. We also consider economic and personal development perspectives and they were obvious in bringing M-PAISA to market in Afghanistan.

Paul Leishman: What other payment options exist in Afghanistan, given that just 3% of the country is banked?

Zahir Khoja:

If you want to send money today from one district to another, you’ll personally deliver that money by walking, taking a taxi, or taking a donkey.

Alternatively you would give the money to a friend, what’s referred to as a trusted agent, and say ‘please deliver this for me and you can keep 5-10% for yourself.’

Or finally you would go to a Hawala market and pay a set fee for the money to be sent to the recipient in a corresponding district, village or province.

These are the money transfer options that exist today, and we’re trying to educate people on how to send money on their mobile phone. 25% of the population in Afghanistan have a mobile phone and this is the group we’re targeting. The challenge we have is that people don’t trust banks, let alone the idea that their money is now just on an SMS. But recall that 75% of Afghans can’t read: that’s where our IVR comes in.

Paul Leishman: What have you done to driving understanding of the benefits and functionality of an IVR?

Zahir Khoja: That’s the challenge we’re having now: getting the IVR message into the marketplace. What we’re trying to do now is address the market based on their needs. Afghanistan just went through an election period which was an unsafe time for the country. In response, the campaign we’ve launched is ‘buy Roshan airtime using your M-PAISA wallet from the convenience of your home.’ This gets a customer to say ‘Yes, I’d like to continue to have airtime, so I’ll figure out how this M-PAISA thing works because I don’t want to leave my home and risk my safety.’

It’s important to use tactics like this that will make a customer say ‘Yes, I really need this’. Right now if you talk to the average Afghan person, there’s no desire to put money into a bank. In some sense, we need to create the need for them - illustrate how these services can make a difference in their lives. Right now we charge 50 Afghani, which is the equivalent of US$1, to send money.

The average person today sends between US$30 and US$50. The pitch to these people to justify our fee is that they no longer need to leave their home, take a taxi or donkey, or spend time going to a Hawala market. Yes, there is a fee but it’s cheaper than all other methods used today.

Paul Leishman: You’ve chosen to use the word ‘Hawala’ in your tagline: ‘The Hawala on your Mobile’. What is the significance or thought behind this?

Zahir Khoja: Hawalas have been around for hundreds of years and everyone knows that this is where you go to send money. Rather than recreate the wheel, we decided to go with what people understand. Our pitch is that we’re bringing the Hawala to you through your mobile.

Paul Leishman: Thanks Zahir.

The Rest @ Mobil Money for the Unbanked

India Getting an Al Qaeda Franchise

The Jamestown Foundation, a U.S.-based think tank, has warned of a renewed threat to India from the Pakistan-based Lashkar-e-Taiba.

It quotes intelligence sources as saying the LeT’s marine wing may be planning a Mumbai-type incursion to target vital installations in the coastal states of Gujarat, Maharashtra and Goa.

The group is also reported to have funneled huge amounts of money from its Gulf-based networks to fund activities in India.

It is not the first time such a warning has been issued, since the attacks in November. The U.S. embassy still has a warden message on its website dated June 2, 2009, warning U.S. citizens there is a “high threat of terrorism throughout India.

India’s Home Minister P. Chidambaram wasn’t too happy with the advisory when it was issued, arguing the country was safe to travel. But if his own intelligence agencies are talking of a second 26/11, you have to ask yourself if you should not be taking these warnings seriously.

The Jamestown Foundation said the LeT was using the Gulf networks and hawala channels to route money for operations not just in India, but in Pakistan itself.

Is it a tactical shift to ride out international pressure that New Delhi has been trying to bring on Pakistan to act against a group long regarded as a ”strategic asset” ?

This week Pakistan has appealed against a court decision to free LeT founder Hafiz Mohammad Sayeed, accused by India of plotting the Mumbai attack. And simultaneously, the United States moved against the group, launching sanctions against three senior operatives along with one from al Qaeda.

Some people are already speculating if the Lashkar is the new al Qaeda.

The Rest @ The Associated Press

First Bank Systems and Intermex

First Bank System is an American bank holding company. Its major subsidiary is the First National Bank of Minneapolis, MN


There seems to be interest from the holding group in Intermex LLC, in a Minnesota Money Transfer company based in Miami Fl. It specializes in International Wire Transfers, which is currently being acquired by Lindsay Goldberg & Bessemer.

-Shimron Issachar


Intermex was founded by Chairman John Rincon in 1994. With previous experience in the US and Latin American money transfer industry, and with the assistance of his brother Cesar, he quickly launched services in the states of Washington and Oregon.

In 1996 the company started operations in Florida, now its corporate headquarters. Within two years, software was developed to automate remittance data capture and related accounting functions. This improvement quickly fueled the growth of the service network.

By the year 2000, Intermex was licensed in 10 states. Additional technological advances propelled Intermex growth by allowing agents to use computers to communicate remotely with Intermex’s systems.

A major milestone for the company occurred in 2004 by launching services in Texas, a key State due to its proximity to Mexico and a large Hispanic population. In the same year, Intermex acquired and integrated Access Financial, a money order company based in Dallas Texas.
Some notable milestones in Intermex History:

November 2004: Intermex acquires Access Financial a Dallas based money order company.
October 2004: Initiated business in Texas – first major market entered outside of Florida.
August 2006: Intermex Wire Transfer, LLC acquired by Lindsay, Goldberg and Bessemer.
March 2007: Intermex Wire Transfer, LLC acquires Servimex, Inc – adding 400 new agencies and four new states.
July 2007: Opened call center in Puebla, Mexico

Source Intermex Website


Lindsay Goldberg & Bessemer Agrees to Acquire Majority Position in Miami's Intermex Wire Transfer, LLC MIAMI, April 3 /PRNewswire/

-- Lindsay Goldberg & Bessemer (LGB), a New
York-based investment partnership, has entered into an agreement to acquire a
majority ownership position in Miami's Intermex Wire Transfer, LLC, one of the
leading processors of money transfer services focused on Latin America in the
United States. The terms of the acquisition were not disclosed.

"Partnering with Lindsay Goldberg & Bessemer will give us the opportunity
to accelerate our growth in our existing Latin American markets, and
potentially expand into other fast-growth segments of this market," said
Carlos Rincon, Intermex's President.

• With over 230 employees worldwide,
  Intermex Wire Transfer is one of the largest money transfer companies focused
  on Latin America in the United States and is licensed to operate in 26 states
  in the U.S. and 17 countries in Latin America.
• Fueling the growth in the industry are the passage of free trade legislation throughout the Americas and the close proximity of Latin America to the United States.
  
• "We have been exploring the money remittance sector for several years and
  Intermex, as an industry leader, is very well positioned to take advantage of
  the ongoing positive trends in this sector," said Adam Godfrey, Partner of
  Lindsay Goldberg & Bessemer.
• "We look forward to partnering with the Rincon family and management to build upon the company's historical success."
• The added capital infusion from the acquisition will help Intermex meet its growth
  objectives including further organic growth throughout the U.S., expansion of
  the company's international agent network and the continuation of Intermex's
  commitment to outstanding customer service.
  
• The transaction is expected to close within 60 to 90 days and is subject
  to customary closing conditions, including Hart Scott Rodino (HSR) approval.
  
• Banc of America Securities LLC acted as exclusive financial advisor to
  Intermex Wire Transfer, LLC, with respect to the transaction. Intermex was
  represented in the transaction by the Miami law firm of Bilzin Sumberg Baena
  Price & Axelrod, LLP.
  
• About Lindsay Goldberg & Bessemer
  

Lindsay Goldberg & Bessemer is a New York-based investment partnership
with more than $2 billion of committed capital and a focus on acquiring well-
managed businesses and actively helping to build long-term value. LGB is a
trusted and experienced partner with a successful track record of investing
across a wide range of industries and helping companies fully meet their long-
term potential. For more information about Lindsay Goldberg & Bessemer,
please visit http://www.lgblp.com .

The Rest @ International News

Minnesota Money Transfer Companies

MONEY TRANSMITTER COMPANIES regsitered in the State of Minnesota as of – 4-09.

This list is neither a recommendation nor a condemnation

-Shimron Issachar

AARAN FINANCIAL SERVICES, INC.
2940 Pillsbury Ave S, Ste 201
Minneapolis MN 55408
612-827-3588
License Number: 52046
License Type: Corporation
License Start Date: 12/29/2006
License Expiration Date: 12/31/2009
License Status: ACTIVE
ABC Money Transactions, Inc.
12019 Garden Grove Blvd, Ste 204
Garden Grove CA 92843
714-590-8740
License Number: 51977
License Type: Corporation
License Start Date: 2/13/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

ACE Cash Express, Inc.
1231 Greenway Dr, Ste 600
Irving TX 75038
972-550-5052
License Number: 52067
License Type: Corporation
License Start Date: 3/4/2008
License Expiration Date: 12/31/2009
License Status: ACTIVE

ADP PAYROLL SERVICES, INC.
ONE ADP BLVD, M/S 325
ROSELAND NJ 07068
909-592-6411
License Number: 52073
License Type: Corporation
License Start Date: 4/20/2009
License Expiration Date: 12/31/2009
License Status: ACTIVE
Amaana Money Transfer Co.
2940 Pillsbury Ave S, Ste 205
Minneapolis MN 55408
612-825-2992
License Number: 52049
License Type: Corporation
License Start Date: 2/28/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE

Amal Money Wire, LLC
1806 Riverside Ave S, Ste 1
Minneapolis MN 55454
612-332-6893
License Number: 51963
License Type: Limited Liability Company
License Start Date: 1/17/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE
AMAZON PAYMENTS, INC.
1200 12th Ave S
Seattle WA 98144
206-266-6863
License Number: 52042
License Type: Corporation
License Start Date: 7/31/2006
License Expiration Date: 12/31/2009
License Status: ACTIVE

American Express Travel Related Services Company, Inc.
200 Vesey St, World Financial Center
UMC: NY 4902
New York NY 10285-4902
212-640-5100
License Number: 51973
License Type: Corporation
License Start Date: 2/4/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

ANH MINH MONEY TRANSFER, INC.
9211 Bolsa Ave, Ste 104
Westminster CA 92683
714-893-4348
License Number: 52054
License Type: Corporation
License Start Date: 5/17/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE
MONEY TRANSMITTER COMPANIES – 4-09 ACTIVE STATUS Page 2 of 8

BAKAAL WORLDWIDE, INC.
2910 Pillsbury Ave. So.
Suite A212
Minneapolis, MN 55408
651-353-9599
License Number: 52071
License Type: Corporation
License Start Date: 2/17/2009
License Expiration Date: 12/31/2009
License Status: ACTIVE

CHECKFREEPAY CORPORATION
15 Sterling Dr
PO Box 5044
Wallingford CT 06492-7544
203-679-4400
License Number: 51991
License Type: Corporation
License Start Date: 4/11/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE
Coborn’s, Incorporated
1445 E Highway 23
St Cloud MN 56304
320-252-4222
License Number: 52021
License Type: Corporation
License Start Date: 5/20/2004
License Expiration Date: 12/31/2009
License Status: ACTIVE

COINSTAR E-PAYMENT SERVICES INC.
dba Coinstar Money Transfer
1800 114th Ave SE
Bellevue WA 98004
425-943-8330
License Number: 52055
License Type: Corporation
License Start Date: 5/17/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE
Comdata Network, Inc.
5301 Maryland Way
Brentwood TN 37027
615-370-7000
License Number: 51975
License Type: Corporation
License Start Date: 2/4/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE
Continental Exchange Solutions, Inc.
dba RIA Financial Services dba Associated Foreign Exchange
13850 Cerritos Corporate Dr, Ste E
Cerritos CA 90703
562-345-2128
License Number: 52050
License Type: Corporation
License Start Date: 4/19/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE

COSTAPOLIS TRAVEL, INC.
622 Central Ave SE
Minneapolis MN 55414
612-623-1116
License Number: 51982
License Type: Corporation
License Start Date: 2/25/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

CUSTOM HOUSE (USA) LTD. DBA CUSTOM HOUSE
517 Fort Street, 2nd Floor
Victoria, BC V8W1E7
250-220-1015
License Number: 52070
License Type: Corporation
License Start Date: 12/11/2008
License Expiration Date: 12/31/2009
License Status: ACTIVE

MONEY TRANSMITTER COMPANIES – 4-09 ACTIVE STATUS Page 3 of 8

DAHAB-SHIL, Inc.
2025 Nicollet Ave S, Ste 206
Minneapolis MN 55404
612-871-4413
License Number: 51957
License Type: Corporation
License Start Date: 1/3/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE
Dar al Tawakul General Trading, LLC
dba Tawakul Money Express
2200 Franklin Ave E, Ste 204
Minneapolis MN 55404
612-408-2379
License Number: 52016
License Type: Limited Liability Company
License Start Date: 6/11/2003
License Expiration Date: 12/31/2009
License Status: ACTIVE
"Envios de America," INC.
3455 4th Ave S
Minneapolis MN 55408-4527
612-824-2524
License Number: 51965
License Type: Corporation
License Start Date: 2/20/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

ENVIOS RAPIDOS INTERNATIONAL2 CORPORATION
101-04 - 43rd St
Corona NY 11368
718-397-1515
License Number: 51996
License Type: Corporation
License Start Date: 4/29/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

ESPECIAL EXPRESS II CORP.
7225 NW 25th St, Ste 200
Miami FL 33122-1709
305-592-1364
License Number: 52056
License Type: Corporation
License Start Date: 5/24/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE

GREEN DOT CORPORATION
605 E Huntington Dr, Ste 205
Monrovia CA 91016
626-775-3400
License Number: 52063
License Type: Corporation
License Start Date: 10/29/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE
GSC ENTERPRISES, INC.
dba FIDELITY EXPRESS
1301 Main Street
Sulphur Springs TX 75482
903-885-1283
License Number: 52059
License Type: Corporation
License Start Date: 7/18/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE
Hafez Group, Inc
2310 Central Ave NE
Minneapolis MN 55418
612-388-3300
License Number: 51974
License Type: Corporation
License Start Date: 2/4/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

HAJIE FINANCIAL SERVICE INC
4429 Nicollet Avenue, Apt. #204
Minneapolis MN 55419
612-227-3369
License Number: 52039
License Type: Corporation
License Start Date: 6/15/2006
License Expiration Date: 12/31/2009
License Status: ACTIVE

MONEY TRANSMITTER COMPANIES – 4-09 ACTIVE STATUS Page 4 of 8

HAMDI EXPRESS, INC.
413 Cedar Ave S, Ste 4
PO Box 582162
Minneapolis MN 55458-2162
612-333-1172
License Number: 52053
License Type: Corporation
License Start Date: 5/10/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE
HASHI MONEY WIRING LLC
15211 International Boulevard South
Seatac, WA 98188
206-246-5048
License Number: 52061
License Type: Corporation
License Start Date: 6/27/2008
License Expiration Date: 12/31/2009
License Status: ACTIVE
Hodan Global Money Services, Inc.
2910 Pillsbury Ave S, Ste 208
Minneapolis MN 55408
612-822-6800
License Number: 51988
License Type: Corporation
License Start Date: 3/21/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

HONG LAN SERVICES INC.
9113 Bolsa Ave, Ste 122
Westminster CA 92683
714-891-8939
License Number: 52057
License Type: Corporation
License Start Date: 5/24/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE
I. B. Xpress, Incorporated
7046 Brooklyn Blvd
Brooklyn Park MN 55429
612-585-9807
License Number: 51969
License Type: Corporation
License Start Date: 1/31/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE
Iftin Trading, LLC
1817 Nicollet Ave., Ste. 300
Minneapolis MN 55403
612-879-1032
License Number: 52060
License Type: Limited Liability Company
License Start Date: 7/18/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE

INTEGRATED PAYMENT SYSTEMS INC.
12500 E Belford Ave, M18U
Englewood CO 80112
303-967-5529
License Number: 51958
License Type: Corporation
License Start Date: 1/4/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE
Intercambio Express, Inc.
dba Rayo Transfers
201 Clinton Ave E
Goshen IN 46528
574-534-8020
License Number: 52032
License Type: Corporation
License Start Date: 8/31/2005
License Expiration Date: 12/31/2009
License Status: ACTIVE
Intermex Wire Transfer, LLC
9480 Dixie Highway S
Miami FL 33156
305-270-6855
License Number: 51990
License Type: Limited Liability Company
License Start Date: 4/3/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

International Business Group, LLC
2400 Minnehaha Ave S, Ste 207
Minneapolis MN 55404
612-724-1313
License Number: 52041
License Type: Limited Liability Company
License Start Date: 7/13/2006
License Expiration Date: 12/31/2009
License Status: ACTIVE

MONEY TRANSMITTER COMPANIES – 4-09 ACTIVE STATUS Page 5 of 8

IPP OF AMERICA, INC.
330 Passaic Ave, Ste 100
Fairfield NJ 07004
973-830-1575
License Number: 52040
License Type: Corporation
License Start Date: 7/5/2006
License Expiration Date: 12/31/2009
License Status: ACTIVE
ITC Financial Licenses, Inc.
5617 Princeton Avenue, Ste B
Columbus, GA 31904
706-645-9482
License Number: 52028
License Type: Corporation
License Start Date: 4/5/2005
License Expiration Date: 12/31/2009
License Status: ACTIVE
Jallow Express Inc.
123 W. Lake Street
Minneapolis, MN 55408
612-388-0474
License Number: 52033
License Type: Corporation
License Start Date: 8/31/2005
License Expiration Date: 12/31/2009
License Status: ACTIVE

Kaah Express, F.S. Inc.
611 Cedar Ave S
Minneapolis MN 55454
612-332-6200
License Number: 52045
License Type: Corporation
License Start Date: 12/29/2006
License Expiration Date: 12/31/2009
License Status: ACTIVE
L.G. Money Transmitter Corp.
420 Hennepin Ave E
Minneapolis MN 55414
612-617-1039
License Number: 52012
License Type: Corporation
License Start Date: 1/28/2003
License Expiration Date: 12/31/2009
License Status: ACTIVE

Maniflo Money Exchange, Inc.
1442 Highland Ave
National City CA 91950
619-474-1547
License Number: 51989
License Type: Corporation
License Start Date: 4/3/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE
Metavante Payment Services, LLC
4900 Brown Deer Rd W
Milwaukee WI 53223-2459
414-357-3543
License Number: 52030
License Type: Limited Liability Company
License Start Date: 6/16/2005
License Expiration Date: 12/31/2009
License Status: ACTIVE

MoneyGram Payment Systems, Inc.
1550 Utica Ave S
Minneapolis MN 55416
952-591-3000
License Number: 51970
License Type: Corporation
License Start Date: 1/31/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE
nFinanSe Payments, Inc.
3923 Coconut Palm Drive, Suite 107
Tampa, FL 33619
813-367-4400
License Number: 52068
License Type: Corporation
License Start Date: 6/12/2008
License Expiration Date: 12/31/2009
License Status: ACTIVE
North American Money Transfer, Inc.
5405 Memorial Dr., Bldg. A, Suite 104
Stone Mountain GA 33083
404-704-0273
License Number: 51987
License Type: Corporation
License Start Date: 3/7/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

MONEY TRANSMITTER COMPANIES – 4-09 ACTIVE STATUS Page 6 of 8

NoteWorld LLC dba NoteWorld Servicing Center
1001 Pacific Aenue, Suite 200
Tacoma WA 98402
253-620-7114
License Number: 52072
License Type: LLC
License Start Date: 4/20/2009
License Expiration Date: 12/31/2009
License Status: ACTIVE
Obopay, Inc.
275 Shoreline Dr, Ste 400
Redwood City CA 94065
650-264-2000
License Number: 52064
License Type: Corporation
License Start Date: 10/29/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE
Omnex Group, Inc.
dba Giromex and dba UNO Money Transfers
580 Sylvan Avenue, Suite M-A
Englewood Cliffs, NJ 07632
201-568-5209
License Number: 52025
License Type: Corporation
License Start Date: 12/22/2004
License Expiration Date: 12/31/2009
License Status: ACTIVE

ORDER EXPRESS, INC.
dba MEXI DOLLAR INC
685 W Ohio St
Chicago IL 60610
773-257-0027
License Number: 52038
License Type: Corporation
License Start Date: 3/16/2006
License Expiration Date: 12/31/2009
License Status: ACTIVE
PayPal, Inc.
2211 First St N
San Jose CA 95131
408-967-1068
License Number: 52006
License Type: Corporation
License Start Date: 9/5/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

PreCash, Inc.
1800 W Loop S, Ste 1400
Houston TX 77027
713-600-2200
License Number: 52043
License Type: Corporation
License Start Date: 10/11/2006
License Expiration Date: 12/31/2009
License Status: ACTIVE

QARAN EXPRESS US INC.
2003 10th Avenue, #2
Minneapolis MN 55404
612-250-5524
License Number: 52044
License Type: Corporation
License Start Date: 12/27/2006
License Expiration Date: 12/31/2009
License Status: ACTIVE

Qaran Financial Express, LLC
3819 D.S. George Mason Dr
Falls Church VA 22041
571-218-7778
License Number: 52048
License Type: Limited Liability Corporation
License Start Date: 1/17/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE

Olympic Financial Group, Inc.
325 Cedar Ave., #7
Minneapolis MN 55454
651-274-3640
License Number: 52027
License Type: Corporation
License Start Date: 3/29/2005
License Expiration Date: 12/31/2009
License Status: ACTIVE

MONEY TRANSMITTER COMPANIES – 4-09 ACTIVE STATUS Page 7 of 8

Ritmo Envia, Inc.
197 Concord St
St Paul MN 55107
651-222-8036
License Number: 51976
License Type: Corporation
License Start Date: 2/13/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

Ruesch International, Inc.
1152 15th Street NW, 7th Floor
Washington DC 20001
202-408-1200
License Number: 52034
License Type: Corporation
License Start Date: 9/18/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE

Saigon Central Post, Inc.
9455 Bolsa Ave, Ste E
Westminster CA 92683
714-530-6660
License Number: 52019
License Type: Corporation
License Start Date: 1/15/2004
License Expiration Date: 12/31/2009
License Status: ACTIVE

Samso’s Express Money Transfer, Inc.
11168 Whitehawk St
Plantation FL 33324
954-382-5948
License Number: 52014
License Type: Corporation
License Start Date: 4/30/2003
License Expiration Date: 12/31/2009
License Status: ACTIVE

Sankhar Forex, Inc.
5808 Xerxes Ave No
Brooklyn Center MN 55430
763-503-7732
License Number: 52031
License Type: Corporation
License Start Date: 6/23/2005
License Expiration Date: 12/31/2009
License Status: ACTIVE

Servicio UniTeller, Inc.
218 Route 17 N, Ste 402
Rochelle Park NJ 07662
201-345-2000
License Number: 52001
License Type: Corporation
License Start Date: 5/29/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

Sigue Corporation
13291 Ralston Ave.
Sylmar, CA 91342
818-493-5101
License Number: 51956
License Type: Corporation
License Start Date: 12/31/2001
License Expiration Date: 12/31/2009
License Status: ACTIVE

T-Chek Systems, Inc./Les Systemes T-Chek Inc.
14800 Charlson Road, Suite 100
Eden Prairie MN 55347
952-974-7260
License Number: 51985
License Type: Corporation
License Start Date: 3/4/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

Tempus Consulting, Inc.
1225 New York Ave NW, Ste 200
Washington DC 20005
202-785-5534
License Number: 52058
License Type: Corporation
License Start Date: 7/18/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE

Trans-Fast Remittance LLC
16 W. 46th St., 4th Floor
New York NY 10036
212-382-2828
License Number: 52051
License Type: Limited Liability Company
License Start Date: 4/19/2007
License Expiration Date: 12/31/2009
License Status: ACTIVE

MONEY TRANSMITTER COMPANIES – 4-09 ACTIVE STATUS Page 8 of 8

Travelex Currency Services Inc.
C/O Travelex Canada Ltd, Scotia Plaza, 100 Yonge St, 14th Floor
Toronto, Ontario Canada M5C 2W1
416-981-2192
License Number: 51979
License Type: Corporation
License Start Date: 2/13/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

UNIDOS FINANCIAL SERVICES, INC.
1250 Broadway, 30th Floor
New York, NY 10001
212.931.8683
License Number: 52069
License Type: Corporation
License Start Date: 10/31/2008
License Expiration Date: 12/31/2009
License Status: ACTIVE

VIAMERICAS CORPORATION
4641 Montgomery Ave, Ste 400
Bethesda MD 20814
301-215-9294
License Number: 52066
License Type: Corporation
License Start Date: 1/2/2008
License Expiration Date: 12/31/2009
License Status: ACTIVE

WESTERN UNION FINANCIAL SERVICES, INC.
12500 E Belford Ave, Ste M12K3
Englewood CO 80112
866-959-9898
License Number: 51959
License Type: Corporation
License Start Date: 1/4/2002
License Expiration Date: 12/31/2009
License Status: ACTIVE

Source: Minnesota Department opf Commerce Database

Hawala Remittances Growing Despite Recession

Despite the global recession, the remittances from the developing countries and the Middle East and North Africa (Mena) region will continue to grow, even if moderately in 2010-2011.

According to a World Bank Migration and Development Brief titled "Revised Outlook for Remittance Flows 2009-2011", the remittances from the developing countries are projected to

• Grow to 2.9 per cent in 2010 and 6.3 per cent in 2011.
• In the same way, the Mena region is projected to see a growth of 2.9 per cent in 2010 and 5.6 per cent in 2011.
• However, this is a far cry from the 13 per cent year-on-year growth the global remittance market has seen in the last decade.

But the economic crisis has brought many new challenges for this sector, like it has for the rest of the world.Emirates Business spoke to major players in the market to find out more about the business of remittances and what is in store for this sector during these tough times. Talking about the international remittance market YS Shetty, COO, Global Operations, UAE Exchange, said:

• "The global remittance market is estimated at approximately $317.7 billion (Dh1.16 trillion), according to the World Bank 2008 Migration and Remittance Yearbook.
• This market is driven by 125 million people living abroad, who remit money to their home countries. The market has grown consistently over the past 15 years, sustained by significant movements of people across borders.Dubai, Riyadh, Istanbul, Hong Kong, Miami, Moscow and London are regions that have attracted large number of migrant workers and professionals from countries such as India, Philippines, Indonesia and Mexico.
• On an analysis of the remittance flows, it is seen that the remittances are growing at an average rate of 13 per cent since 2000.

The major recipient country in terms of inward remittance is India, which received $27 billion in 2007.

According to Shetty, with an expatriate population of 80 per cent, the UAE is a huge remittance market.

Being a major oil-producing nation, the size of the economy attracts a large number of foreign workers especially to the financial hub of the region – Dubai.

• Even though there are no accurate numbers available for the size, according to certain reports in the regional media the market size is estimated at $6.5 Billion .

According to Jean Claude Farah, Senior Vice-President, Middle East, Pakistan and Afghanistan for Western Union Financial Services:

"The Kingdom of Saudi Arabia and the UAE remain the top sending markets and the top receive markets are India and Pakistan."

Going into the factors that influence remittances Farah told Emirates Business:

"There are a number of factors that influence the frequency and amount sent – including need, employment, and currency movements in the global market. "For example, when the currency in which money is earned strengthens against the currency to which it is sent, there has been continued growth," said Farah. Shetty added:

"The profitability of the market varies from region to region.

• The fewer the number of players in the market more is the profitability. Remittances have always been a live and growing market since the post WTO era and year-on-year growth on an average has been 13 per cent since 2000.
• "However, the global downturn has taken its toll on this vibrant sector as well and a few months ago the World Bank predicted that the remittance business globally would fall by about four per cent to eight per cent as the economic crisis has resulted in job cuts everywhere especially in the developed countries.
• Traditionally there has always been a major flow of transaction from the West ie United States and Europe to the other parts of the world, but due to the current recession, remittances from the West fell due to a slump in job markets. For instance, as per the statistics published by Mexican Central Bank, there has been a drop of nearly four per cent in remittances to Mexico.
• The US to Mexico remittance corridor is the largest in the world in terms of volume remitted.
• However, there is still hope for the sector as after the initial gloomy outlook the World Bank revised its findings in March and said that the remittances to developing nations would see a growth in 2010.

Farah said: "The revised World Bank report issued in March forecasts that remittances to developing countries will return to modest growth in 2010 as the mobile work force continues to seek employment throughout the globe.

And recently, the Philippines Central Bank reported that remittances from Filipinos working overseas are unlikely to decline this year.

"According to Shetty remittances to Asian countries, especially South Asia has been increasing over the past few years, though the rate of growth has come down now.

Talking about what the future looks like for the business, Farah said: "It is important to keep in mind that migrant workers, the majority of customers who use money transfer services, need to send money home to support families for basic services.

Remittances are not a discretionary spend. So despite the economic slowdown, remittances continue to be sent."

Talking about what the market is doing to boost business in the current scenario, Farah said:

"The industry comprises global money transfer providers like Western Union, small corridor specialists that serve limited countries and banks that offer their own money transfer products.

It is difficult to generalise in terms of strategy, however, signing up new agents and expanding the network continue to be priorities.

"We, for our part, are constantly getting feedback from our customers and co-operation partners, and proactively restructuring our services and rates to provide the customer a value-added experience through flexible solutions at competitive prices."

The experts also touched upon the challenges faced by the sector like the informal channel of remittance called Hawala that is practiced globally and the fact that banks have also entered the fray.

Farah said: "Hawala has always been a reality in the money transfer industry.

• Recently, we have seen many countries change rules in this area to formalise and regulate this system of money transfer.
• We welcome all initiatives by the local authorities in managing this.
• "The experts however seemed unfazed by the banks' fishing in the same waters as them.

Farah said: "It is estimated that the world remittances market is over $37 Billion.

• This is a huge market and as such there is room for many more players.
• We as Western Union have nearly 17 per cent of the market share and I am sure there is room for many. "
• Also, remittances is an added revenue stream for a bank and is not their core competency. We do not see them as competition and in-fact partner with banks to extend our services through their branch locations.

In the end its all about empowering the customer with a full bouquet of services and options, and with a proven product, reach and brand recognition as ours, we stand clear ahead of the competition," added Farah.

Shetty said: "All banking institutions have been hit by the economic downturn. Probably, they are looking into other avenues of business as additional sources of revenue, including money transfer.

These banks are further boosted by the launch of money transfer models by Visa and MasterCard, which enable card-to-card transfers.

"If we compare them with money transfer companies with respect to the transaction fees or charges, I don't think there is any particular value added for the customer. The nature of the service remains the same. However, in defence of money transfer firms, they have the added value of customised services for its customers."

"Regarding the question of the banks eating into our profits the definite answer is 'no'. This is because, most money transfer companies and particularly companies such as the UAE Exchange, who have been around for years and who have numerous very conveniently located outlets, have a committed customer base and will continue to provide the best services to them.

We are confident that our customers will continue to be loyal to us," said Shetty.

Keep up with the latest business news from the region with

The Rest @ the Emirates Business 247 daily newsletter.

MOHAMED Y. ABSHIR WALDO familiar with Somali Remmitance Companies in US

MOHAMED Y. ABSHIR WALDO is the founder and director of the Sandi Consulting Group, a political, business and strategic consulting group whose primary focus is the revival and reconstruction of the Somali nation.

Starting out as a radio journalist with the BBC World Service and as Director of the Somali Broadcasting Service in the 1960s, he has been, at various points in his career (and sometimes all at once), a political activist, an entrepreneur and a development consultant.

His recent writings on the remittance industry stem from his development work on micro-finance issues as well as his interest in regional rehabilitation through small-business initiatives.

Mohamed is a graduate of Columbia University Journalism School (MA in Mass Media, 1968).

the Rest @ AUNDP Wach

A Hawala Example

A recruited Jihadist in the United States, say Minneapolis, MN collects enough funds to finance their service, from family or "mystery Scholarship." They then take the funds they will need to a Hawaladar (One who operates a Hawala) in their home city in the US (they are all over).

The Hawaladar has along established relationship with a counterpart Hawaladar in Pakistan, Afghanistan, Somalia or Iraq.

1. The Hawaladar in the US collects all the funds, and may accumulate the funds for a later purchase
2. The Hawaladar in the War zone pays cash in local currency to the Mujahadi-terrorist as he arrives in country.
3. After enough cash debt has accumulated in the US, the War Zone the Hawaladar places an order for a commodity that is in high demand in his own country, that he can sell for a profit.
4. The US Hawaladar uses the cash that has been accumulated to buy the commodity at local prices, usually less than the cash that has accumulated.
5. The US Hawaladar then arranges to ship the commodity to the War Zone Hawaladar.
6. When The War Zone Hawaladar sells the commodity order, each Hawala has made money, and the process can begin again.

• Though both Hawaladars may have bank accounts, none of the transactions with the banks are tied to the terrorist money transfer.
• All bank activities are tied to "client fees" and import and export activity.
• No money actually moves between countries

New international record keeping requirements have been set in place to prevent money laundering, but the most abusive countries don' t participate, don' t have real over site or regulation, or corruption plays a role.

Some suggested ways to stop this transaction.

• Flag and Monitor Three-party import/exports (US, Pakistan, Somalia, for example)
• Enforce new Hawala documentation requirements with enough heavy fines to shut abusers down
• Infitrate Western Hawaladars to see if there is a back-room terrorist money laundering operation going on with a legitimate remittance business going on in the front room.

Pakistan estimates that 5 Billion US Dollars a year pass through Hawalas in Pakistan.

finally, Hawalas are widely acknowledged to be the most common form of mid to low level financing and logistics for terrorism, and will remain so unless Western Hawaladars can come up with standards that will allow criminals to be tracked.

- Shimron Issachar

Some India Diamond Trading Schemes May involve Hawalas

Of the 230 entities banned by the Securities and Exchange Board of India for their role in the Nirmal Kotecha scam, 43 are actually companies registered as gems and jewellery and diamond trading companies, while 63 are registered as export-import companies. Here is a verbatim transcript of Vivek Law’s comments on CNBC-TV18. Also see the accompanying video.

We told you earlier the Nirmal Kotecha-Pyramid Saimira scam is not just confined to one stock. He has been playing in several stocks that are now under probe. There is also a scanner on the role of various banks because there was a lot of movement in and out of various bank accounts.

The Rest @ MoneyControl.com

• Along with him, 230 entities have been banned from the market.
• Now, 43 of these 230 companies are actually companies registered as gems and jewellery and diamond trading companies, while 63 out of these are registered as export-import companies.
  

We understand the authorities are now probing whether these were indeed genuine companies indulging in this business.

• If not, or even if they were, is this a situation of hawala transactions having taken place, or foreign exchange norms having been violated.
• We understand that is now in the scope of this scam, which has also caught the attention of various regulators and authorities.
• The Sebi order has already mentioned that a large deal of money laundering seems to have been witnessed in this entire scam.

Mohamed Djirdeh Houssein

Age: 63
Gender: Male
Industry: Banking
Occupation: Business
Location: Dubai : United Arab Emirates

A businessman in finance, trading and in manufacturing
location of xareed (Near Hargeysa, Somalia)
-Mr. Mohamed Djirdeh Houssein-

• CEO, Sahan Commercial Broker
• Chairman of the Somali Finacial Serves Association since 2004.
• Chairman of Somali Money Transmitters Association (SOMTA)
• Here is his blog
• Spoke at the This 2004 Conference (page84)in Dubai on the topic of Hawala in Somalia

Interests
sports
gymnastics
reading
movies
Favourite Films
Godfather
Favourite Music
Jazz
Blues

Salah Ali Samatar the Somali Pirate Tells HIs Story

NAIROBI, Kenya — There's at least one job these days that's recession-proof, if you can handle shark-infested seas, outrun some of the world's most powerful navies and keep your cool when your hostages get antsy.

A pirate's life in Somalia isn't for everyone. However, nothing comes easily in one of the poorest and most unstable countries on Earth, and when you consider the dearth of career options for Somalis on land, a pirate's life starts to look more than cushy by comparison.

"Is there any Somali who can earn a million dollars for any business? We get millions of dollars easily for one attack," bragged Salah Ali Samatar, a 32-year-old pirate who spoke by phone from Eyl, a pirate den on Somalia's desolate northern coast.

Hundreds of pirates such as Samatar — zipping around in simple fiberglass speedboats and usually armed with nothing more sophisticated than automatic rifles — have turned the waters off East Africa into a terrifying gantlet for cargo vessels, oil tankers and even cruise ships sailing between Europe and Asia.

The International Maritime Bureau says that at last count 42 ships have been hijacked off Somalia this year, and experts in neighboring Kenya estimate that Somali pirates have pocketed $30 million in ransoms.

While their countrymen suffer through another political crisis and the looming threat of famine, pirates are splashing hundred-dollar bills like play money around the nowhere towns of northern Somalia.

Residents say that the pirates are building houses, buying flashy cell phones and air-conditioned SUVs, gifting friends and relatives with hundreds and sometimes thousands of dollars and winning the attention of beautiful women, who seem to be flocking to pirate towns from miles around.

Shopkeepers charge the pirates a premium for food and khat — a narcotic leaf that Somali men chew religiously — but the buccaneers don't seem to mind.

"It is true," said a 28-year-old pirate who identified himself as Jama. "We are getting very rich."

Jama, who described himself as a high-ranking member of a group based in Eyl, has earned $375,000 as a pirate, enough to buy a Toyota Land Cruiser and to begin building a six-bedroom house in Garowe, the regional capital, for his family.

His biggest payday came last month, when he earned a $92,000 share of a $1.3 million ransom for a Greek ship, the MV Centauri, which was released after 10 weeks with its crew unharmed.

Almost overnight, Jama said, his standing with the fairer sex has improved dramatically.

"Once there was a girl who lived in Garowe," 100 miles from Eyl, Jama said. "I loved her. I tried to approach her many times, but she rejected me. But since I became a pirate, she has tried nine times to get with me.

"But I refused, because I'm already married."

For years, piracy was a middling trade in Somalia, just one way that desperate young men with guns could make a living in a desperately poor land.

In recent months, however, with food prices soaring, the interim government careening toward collapse and local authorities powerless to intervene, hardly a day has gone by without an attempt to commandeer a ship.

"Socioeconomic status in Somalia is very bad right now, as we know, and this is one of the reasons pirates have turned to hijacking," said Cyrus Mody of the International Maritime Bureau, based in London. "There are a few people who are gaining a lot."

In September, pirates captured the world's attention by seizing the MV Faina, a Ukrainian ship ferrying tanks, grenade launchers and other weapons, reportedly to southern Sudan.

In November came an even more brazen haul: the Saudi-owned Sirius Star supertanker, the biggest ship ever hijacked, loaded with $100 million worth of oil. Both vessels are still being held for ransom.

• The U.S. military and NATO have deployed warships to patrol the region, and China said this week that it would send a fleet to join the effort.
• Also this week, the U.N. Security Council authorized nations to chase pirates onto land, although U.S. military officials are skeptical of that tactic, arguing that pirates can easily blend into the local population.

Many of the pirates are former fishermen who claim that they're retaliating against rich countries for years of illegal fishing and dumping in Somali waters, and a small portion of the ransoms is thought to go to local fishermen.

One pirate group in Eyl goes by the name "Saving the Somali Sea," although residents complain that the lion's share of the cash stays in the pirates' pockets.

"This town benefits nothing from the pirates," said Bishara Said Ahmed, a 38-year-old housewife in Eyl. "There's no business increase. It's like how it was before. The pirates use this town just to take ships, and when they have their money, they go to other towns to spend it."

Ransom payments used to be made via hawala, a money-transfer system that functions as a low-fee Western Union in the Muslim world.

As the sums have grown, however, ship owners increasingly rely on helicopter drops from Kenya. Wooden crates packed with cash sometimes fall from the sky in Eyl, like manna to the impoverished civilians barely eking out an existence on dry land.

Money-counting machines like the ones at your local bank — "We have to make sure it's real money," Jama explained — tally up amounts so huge that families who have survived on fishing for generations say that young children now want to grow up to be pirates.

"Whenever we hear that a ransom was paid, children's dreams of becoming pirates just increase," Ahmed said.

It isn't just children who are starry-eyed. Mustaf Mohamed Abdi, a 48-year-old taxi driver in Garowe, marveled at the excitement in town when a band of pirates comes through on a spending spree. If he's lucky, Abdi said, a friendly pirate might tip him with a hundred-dollar bill.

"The pirates are the hottest men in town," Abdi said. "Girls from all over Somalia moved here to marry pirates. But if the girl isn't cute she's out of luck, because the pirates only go with beautiful girls."

(McClatchy special correspondent Ahmed Ali Sheik contributed to this article.)

The Rest @ Common Dreams