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Minn. Hawala To Re-Open With Small Money Transfers

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(credit: Jupiter Images)

(credit: Jupiter Images)

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MINNEAPOLIS (AP) — One of the Minnesota businesses that stopped sending wire transfers from the U.S. to Somalia last week re-opened Friday to allow transfers in small dollar amounts.

Garad Nor, president and chief executive of Tawakal Money Express, said customers begged him to resume the business so they could help their relatives in the Horn of Africa. He said he would allow transfers in amounts of no more than $500 and for emergency situations only.

“They are asking me, please, please, please,” he said of his customers. “So I have to open it. … I think it’s gonna be OK. I decided. That’s it. We will open it under limited amounts.”

Tawakal was one of 15 Minnesota money transfer businesses, also known as hawalas, that stopped accepting wire transfers last week because the bank that handles the majority of the transactions closed their accounts. Minnesota-based Sunrise Community Banks said it feared it might unintentionally violate complex regulations designed to combat terror financing.

Somalis in the U.S. use the hawalas to send money to relatives in their famine-stricken homeland and nearby refugee camps. The African country hasn’t had a functioning government since 1991 and has no banking system.

Sunrise’s decision came weeks after two Minnesota women were convicted in October of conspiracy to provide support to al-Shabab, a group at the center of violence in Somalia and one that the U.S. says is tied to al-Qaida. Evidence at the Minnesota trial showed the women sent the money through the hawalas.

Nor told The Associated Press his business has accounts with other banks outside Minnesota and would be able to continue to legally send remittances. He wouldn’t be more specific about his other accounts, out of fear they might close too.

The U.S. Treasury has said Somalis have other legitimate ways to send money home. Those include sending money through other money transmitters or U.S.-based banks to clearinghouses or hubs in Dubai, which arrange for payouts in Somalia, or declaring the money and shipping cash or money orders to the hubs for payout in Somalia. Somalis in Minnesota, which has the largest Somali population in the U.S., said those options aren’t practical.

Abdulaziz Sugule, former chairman of the Somali Money Services Business and now a consultant on the issue, said that to his knowledge, there were no other hawalas in Minnesota that planned to reopen Friday.

Omar Jamal, first secretary of the Somali Mission to the United Nations, has been meeting with Somalis in Texas this week. He said he’s met people who are openly crying because they can’t get money to their families in East Africa — who need the remittances to pay for food, rent or medicine. Jamal said he met one person whose relatives can’t pay rent and face eviction from an apartment in Nairobi, Kenya, because they didn’t receive their remittance at the start of January.

“It’s getting worse every single day,” Jamal said. “The majority of the people who use that lifeline to support their siblings and family members can foresee the crisis — that his mother doesn’t have anything to eat next week, or that his wife and kids are being evicted. They can see the sky falling on them and they become very distraught, very emotional.”

He said Nor’s decision will create a little bit of relief, but it won’t cover the need in the long term. Members of the Somali community, government officials and others continue to look for a solution.

After reopening, Nor said: “People were crying, But now my customers, they are happy. At least they can send $100 to their family now.”

Tawakal Money Express held a four-day training workshop for its staff and agents in Somalia on compliance of anti-money laundering regulations. The goal of the workshop, held last week, was to give workers a better understanding of regulations and train them on ways to detect and prevent illegal transactions.

Jamal said the training is important at this time because if someone is arrested for using Tawakal to send money to al-Shabab, “that will be the end of the story.”

(© Copyright 2012 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)

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