Following the Terrorist Informal Money Trail: The Hawala Financial Mechanism

摘要

Since 9/11, investigations into the al Qaeda financial network have led to several notable successes in the United States and Europe. Much of this achievement in the United States has resulted from strengthening the financial investigatory powers of domestic law enforcement agencies and coordinating them through the Treasury Department's new Foreign Terrorist Asset Tracking Center. In other countries, such as France, the Paris-based Financial Action Task Force is helping to coordinate the tracking of terrorist funds through the global banking system and cracking down on countries that fail to improve transparency and regulation. These efforts are already proving useful in uncovering large- scale drug trafficking and money-laundering operations. They also have helped reveal important information about terrorist group financing. Financial investigators tracking al Qaeda's assets rely heavily on data and paper trails from commercial banks and financial regulators in pursuing and investigating leads. Such data have included the tracing of wire transfers between suspected hijacker Mohammed Atta and Shaykh Saiid of Dubai, believed to be one of Osama bin Laden's key financial operatives. Unfortunately, these efforts have achieved little success to date in reaching the core of the al Qaeda financial network. The problem is that much of the organization's funding mechanisms -- like its cells -- are small and inconspicuous, often using a traditional Muslim method of money exchange called Hawala. In essence, Hawala is a transfer or remittance from one party to another without the use of a formal financial institution such as a bank or money exchange, and is, in this sense, an 'informal' transaction. This article describes the workings of the Hawala system, the extent of the system, and methods to combat terrorist use of the system.