2012 Ellison Working with U.S. Treasury on Somali Money Transfers

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Ellison Working with U.S. Treasury on Somali Money Transfers

Rep. Keith Ellison and Sens. Amy Klobuchar and Al Franken are seeking a balance between helping Somalia and preventing terrorism.

James Warden, Patch Staff
Posted Fri, Feb 17, 2012 at 5:24 pm CT | Updated Fri, Feb 17, 2012 at 6:26 pm CT

Rep. Keith Ellison and Sens. Amy Klobuchar and Al Franken are working with the U.S. Treasury to find a way for Somali-Americans to send money to Somalia without facilitating transfers to terrorist groups.

In a conference call Thursday, Ellison noted that money Somali immigrants send to their famine-stricken homeland dwarfs foreign aid from the federal government.

“Really no degree of foreign aid can replace the remittances that they’re sending back to their families every day,” Ellison said, estimating that they total well in excess of $100 million annually. “Remittances are a primary way to keep Somalia afloat.”

By contrast, the U.S. Agency for International Development reports that it provided $47 million to the country in fiscal year 2011.

Ellison also cautioned that shutting down remittances would allow the Somali militant group al-Shabab to gain influence. The group formally joined al-Qaida just over a week ago.

Somali money-transfer businesses in Minnesota, known as hawalas, shut down for more than two weeks in January because the bank that oversaw the transactions worried it might unintentionally break laws that prohibit sending money to terrorist groups. The hawalas have since reopened but remain unsure about the situation.

Ellison said he, Klobuchar and Franken discussed the issue with David Cohen, under secretary for terrorism and financial crimes, who suggested a handful of options.

Treasury is considering a memorandum of understanding between the federal agency and individual banks. The memorandum would give banks some comfort that they were compliant and not likely to face prosecution—although it wouldn’t give them immunity.

That document has not been finalized.

There also is a proposal that would provide greater oversight over who receives remittances in Somalia.

Finally, Cohen spoke with the legislators about the possibility of a humanitarian license in order to expedite the establishment of a credit union or bank that would facilitate

Travelers can also physically carry money to Somalia, Ellison said. But even though it can be legal, it is more opaque than money transfers and potentially dangerous for those who actually carry the money.

“If we didn’t know much about where these remittances were going in the first place, we’ll know a lot less if this money is being transported in a suitcase,” Ellison, adding that that’s the most likely outcome in the short term.

Although the meeting didn’t result in any firm conclusions or timeline, Ellison said he’s satisfied that officials are taking the issue seriously.

“(Cohen) assured me and all of us that solving the issue was a top priority for Treasury and the Obama administration,” Ellison said.