Thursday, October 29, 2020

Somali money transfer companies aided suspected weapons traffickers in moving millions

-

Somali money transfer companies moved more than $3.7 million in cash between suspected weapons traffickers in recent years, including to a Yemeni under U.S. sanctions for alleged militant links, according to a report seen by Reuters.

The findings by a Geneva-based research group, the Global Initiative Against Transnational Organized Crime, could further complicate attempts by Somali transfer companies to retain access to international banking services.

Though they provide a lifeline to millions in the anarchic Horn of Africa nation, few banks will do business with them because of the risk of falling foul of international transparency and anti-money laundering regulations.

Asked about the report, the Central Bank of Somalia, which regulates money transfer firms, said it was unaware of the transfers but would investigate and was in general making progress in countering terrorism financing.

- Advertisement -

Contacted by Reuters, the four companies each said they did their best to comply with global “know your customer” norms despite Somalia having no national identity card. The firms also said they maintained databases of internationally-sanctioned individuals.

The Global Initiative analysed nearly six years of transaction records from the city of Bossasso, matching them with mobile phone records provided by security sources and database searches.

The report identified 176 transactions from the last six years that it said appeared to be linked to suspected weapons dealers in Somalia and Yemen. Nearly two-thirds were over the $10,000 threshold that should trigger an automatic report to regulatory authorities.

They include two transfers totaling nearly $40,000 to numbers linked to Sayf Abdulrab Salem al-Hayashi after the U.S. Treasury sanctioned him in 2017 for allegedly providing weapons and financial support to al Qaeda in the Arabian Peninsula and Islamic State in Yemen, the report said.

- Advertisement -

Al Hayashi could not be reached for comment.

Somalia-based Amal Express and Iftin Express handled the transactions, which used different combinations of his name and nickname, the report said.

Amal Express said a transfer slip shown in the report and allegedly linked to al Hayashi was a forgery. Iftin Express declined to comment on individual transactions.

MULTIPLE IDENTITIES

The report did not find any instances where the other two companies, Dahabshiil and Taaj, made transfers to any sanctioned individuals. But it noted instances where individuals were able to make transfers with them using multiple names and numbers, a violation of Somali law.

One man used 24 names between the four companies, the report said.

All four companies said they did not allow customers to use multiple identities or phone numbers. Dahabshiil also said it has stopped doing transfers between Somalia and Yemen.

The companies did not say whether the six men named in the report are in their databases.




Apart from al Hayashi – the only one under U.S. sanctions – three others whose names appear in the suspect transactions were identified as suspected arms dealers in public reports by the United Nations panel of experts on Somalia.

Two were flagged – one as a proxy for al Hayashi, and one as an arms trafficker – in a confidential annex to a 2018 report by the same panel.

Few Somalis have bank accounts. Money transfer companies – often known as hawalas – are vital to economic activity and delivering humanitarian aid.

Cutting companies off from banking is not the answer, said the report’s author, Jay Bahadur, former head of the U.N. panel of experts. “Excluding companies from international banking services will punish families that rely on them and drive financial flows underground,” he said.

- Advertisement -

But he said companies must ensure their agents follow anti-money laundering laws and Somali authorities must improve enforcement.

“Financial regulatory bodies in Somalia are understaffed, under-resourced, and aren’t trusted by domestic financial institutions,” he told Reuters. “They receive limited reporting data and aren’t able to take much action with what they do receive.”

Abdirahman M. Abdullahi, governor of Somalia’s central bank, said cooperation was improving. Somalia is working with the World Bank on developing a national identity card, he told Reuters.

He said arrests have been made for breaking anti-money laundering and terrorism financing law, citing the case of a trader convicted in August of running an unregistered bank.

MUST READ

Nigerian court declines to issue international arrest warrant for fugitive ex-Petroleum Minister in corruption case

The Abuja Division of the Federal High Court, on Wednesday, refused an application by the Economic and Financial Crimes Commission, EFCC, for an arrest...

South Korea’s former Vice Justice Minister sentenced to jail for bribery and sexual favors

Former Vice Justice Minister Kim Hak-eui, the figure at the center of one of Korea’s biggest political sex scandals, was placed under pretrial detention...

Beam Suntory Inc. fined $19.6 million in foreign bribery case

Beam Suntory Inc. (Beam), a Chicago-based company that produces and sells distilled beverages, has agreed to pay a criminal monetary penalty of $19,572,885 to...

Julius Baer to deny two former CEOs their bonuses over money laundering scandal

Julius Baer will withhold millions of francs in bonuses from its former chief executives Boris Collardi and Bernhard Hodler, as a result of a...

Goldman Sachs executives to cover part payments of $3 billion fines in 1MDB scandal

Nine current or former Goldman Sachs executives, including CEO David Solomon, will have to pay back hundreds of millions of dollars in compensation over...

Subscribe For More

Get our daily notification on the latest financial crimes news around the World

Advertisement
Advertisement

Latest News

This Week

Guatemala seeks arrest of ex-minister linked to a $16m cash discovery

Guatemalan prosecutors are seeking the arrest of the former communications minister for ex-President Jimmy Morales on money laundering charges after finding a connection to...

Former Malawi minister sentenced to six years in prison over passport corruption scandal

A court in Malawi’s capital Lilongwe on Thursday sentenced a former home minister to six years in prison after he was found guilty in...

Goldman Sachs executives to cover part payments of $3 billion fines in 1MDB scandal

Nine current or former Goldman Sachs executives, including CEO David Solomon, will have to pay back hundreds of millions of dollars in compensation over...

Former Harris County deputy constable pleads guilty to transporting drug money and heroin

A former Harris County deputy constable and her husband pleaded guilty Wednesday to charges of conspiracy to possess with intent to distribute heroin, according...
Advertisement

Adblock Detected!

Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by whitelisting our website.

Enable Notifications    Ok No thanks