Somalians caught in crossfire as US bank withdraws cash lifeline

The plight of millions facing starvation is to be made worse by America's new anti-terror legislation

New York

There were urgent warnings yesterday that a decision by a large American bank to stop allowing money transfers from Somali-Americans to relatives and friends in Somalia – a vital lifeline for much of its famine-struck population – could lead to a worsening of the already dire humanitarian crisis there.

Hundreds of Somali-Americans were due to march through Minneapolis last night to protest against the decision by Sunrise Community Banks to back out of executing remittances to Somalia for fear it may find itself in violation of US government anti-terror regulations. The Somali government, as well as its mission to the United Nations, is also appealing to Washington to step in to keep the money flowing.

“This is the worst time for this service to stop. Any gaps with remittance flows in the middle of the famine could be disastrous,” said Shannon Scribner, Oxfam America's humanitarian policy manager, who calculates that up to $100m in remittances could now be in jeopardy. “The US government should give assurances to the bank that there will be no legal ramifications of providing this service to Somalis in need.”

The Somali government says as much as $2bn a year – one third of its gross domestic product – comes to the country as remittances handled in Somalia by local transfer enterprises called hawala. Any drop-off in that source of income threatens only to further destabilise the already impoverished country, which has suffered a prolonged civil war and has no traditional banking system.

A group of money-wire businesses in Minneapolis, home to the largest Somali-American population in the US, said they could no longer accept payments for Somalia because they relied on the Sunrise Community Banks to execute them. Hinda Ali, for the Somali-American Money Services Association, underlined the hardship it could cause.

“A tremendous amount of lives will be lost because they cannot get medical care,” she said. The association added: “Remittance is an essential lifeline for the Somali people, and it is the only source of funding that sustains the livelihood of millions of Somalis, mostly women and children.”

US financial institutions face large penalties if they fail to guard against handling money bound for any terror-related entities. Transfers to Somalia have came under particular scrutiny since the conviction a few weeks ago of two women from Rochester, Minnesota, for raising and transferring funds to al-Shabaab rebels in Somalia, which, according to the US government, has links to al-Qa'ida.

In a statement, Sunrise Banks said it empathised with the Somali people “during this very difficult and uncertain time”. It added: “We continue to work tirelessly with the community and government officials to create a temporary legal and regulatory solution. Until that solution is found, the bank must continue to comply with all US laws and banking regulations.”

Among those pressing the Obama administration to intervene has been Keith Ellison, the only Muslim member of the US Congress whose district includes Minneapolis. “The problem is not just this one bank. The problem is nearly all the banks have sort of stopped out of the business of facilitating remittances to East Africa,” he said.

In New York, the first secretary of the Somali mission to the UN, Omar Jamal, held out hope an arrangement to re-open the remittance lifeline would be reached. “This is a crisis, a humanitarian one, and hopefully a solution will be reached soon,” Mr Jamal said.

Many Somali-Americans feel they are being discriminated against because of a very small, but highly publicised, number of cases linking them to Islamic rebels in the Horn of Africa.

Start your day with The Independent, sign up for daily news emails
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: Chef de Partie

£7 per hour: Recruitment Genius: This award winning conference venues provider...

Recruitment Genius: Admin Assistant

£12000 - £15000 per annum: Recruitment Genius: An expanding Insurance Brokerag...

Recruitment Genius: Experienced Mechanic / Plant Fitter

£24000 - £34000 per annum: Recruitment Genius: This Lancashire based engineeri...

Recruitment Genius: Service Advisor

£16000 - £17000 per annum: Recruitment Genius: Due to expansion and growth of ...

Day In a Page

Revealed: Why Mohammed Emwazi chose the 'safe option' of fighting for Isis, rather than following his friends to al-Shabaab in Somalia

Why Mohammed Emwazi chose Isis

His friends were betrayed and killed by al-Shabaab
'The solution can never be to impassively watch on while desperate people drown'
An open letter to David Cameron: Building fortress Europe has had deadly results

Open letter to David Cameron

Building the walls of fortress Europe has had deadly results
Tory candidates' tweets not as 'spontaneous' as they seem - you don't say!

You don't say!

Tory candidates' election tweets not as 'spontaneous' as they appear
Mubi: Netflix for people who want to stop just watching trash

So what is Mubi?

Netflix for people who want to stop just watching trash all the time
The impossible job: how to follow Kevin Spacey?

The hardest job in theatre?

How to follow Kevin Spacey
Armenian genocide: To continue to deny the truth of this mass human cruelty is close to a criminal lie

Armenian genocide and the 'good Turks'

To continue to deny the truth of this mass human cruelty is close to a criminal lie
Lou Reed: The truth about the singer's upbringing beyond the biographers' and memoirists' myths

'Lou needed care, but what he got was ECT'

The truth about the singer's upbringing beyond
Migrant boat disaster: This human tragedy has been brewing for four years and EU states can't say they were not warned

This human tragedy has been brewing for years

EU states can't say they were not warned
Women's sportswear: From tackling a marathon to a jog in the park, the right kit can help

Women's sportswear

From tackling a marathon to a jog in the park, the right kit can help
Hillary Clinton's outfits will be as important as her policies in her presidential bid

Clinton's clothes

Like it or not, her outfits will be as important as her policies
NHS struggling to monitor the safety and efficacy of its services outsourced to private providers

Who's monitoring the outsourced NHS services?

A report finds that private firms are not being properly assessed for their quality of care
Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

The Tory MP said he did not want to stand again unless his party's manifesto ruled out a third runway. But he's doing so. Watch this space
How do Greek voters feel about Syriza's backtracking on its anti-austerity pledge?

How do Greeks feel about Syriza?

Five voters from different backgrounds tell us what they expect from Syriza's charismatic leader Alexis Tsipras
From Iraq to Libya and Syria: The wars that come back to haunt us

The wars that come back to haunt us

David Cameron should not escape blame for his role in conflicts that are still raging, argues Patrick Cockburn
Sam Baker and Lauren Laverne: Too busy to surf? Head to The Pool

Too busy to surf? Head to The Pool

A new website is trying to declutter the internet to help busy women. Holly Williams meets the founders