Hawala

After the horrible attacks on September 11 2001 an ancient informal moneytransfer system called hawala came under scrutiny for its possibleinvolvement in the financing. This book explores what other similar informaltransfer systems exist and what their percentage of total remittances is. Afteran analysis of its competitors hawala is further explained through a sampletransaction followed by an insight on its bookkeeping. Later the institutionalframework is analyzed and most important its considerable incentives to thecustomer are outlined. The work then tries to define the 'ideal' characteristicsof a transfer system in respect to terrorist financing and explores the currentand actual use of hawala to finance terrorism. How are the necessary fundsgenerated and moved? A brief outlook into the future of terrorist financingwill end this chapter. Being aware of the incentives to the regular customer aswell as to the terrorist organizations to use hawala the major policies to stopthe financing of terrorism will be evaluated as to their efficiency. Are theyenough to dry up terrorist funding?