Yesterday, senior officials from the Treasury Department visited Minneapolis at the invitation of Congressman Keith Ellison for meetings focused on remittances and the Somali community in the United States. The Treasury staff on the trip included Adam Szubin, Acting Under Secretary for Terrorism and Financial Intelligence, Jennifer Fowler, Deputy Assistant Secretary for Terrorist Financing and Financial Crimes, and Jamal El-Hindi, Deputy Director for the Financial Crimes Enforcement Network.
Over the course of his trip, Acting Under Secretary Szubin met with money transmitters serving the Somali community, non-governmental organizations serving East Africa, regional banks, and Minnesota elected officials. These meetings gave senior Treasury officials the opportunity to talk firsthand and in-depth with many of the groups most focused on U.S.-Somali remittance flows. Our goal is to help facilitate remittance flows, while reducing the risks of the financial channels are exploited by terrorist groups.
Cross border remittances play an important part in the economies of many countries around the world, particularly so in the case of Somalia. In recent years, some money transmitters serving the U.S.–Somali corridor have experienced challenges in maintaining U.S. bank accounts because of banks’ concerns that they could unwittingly serve as conduits for terrorist financing. These concerns primarily stem from the lack of a regulated financial sector in Somalia and the abuse or intentional use of Somali remitters to send funds to the terrorist organization al-Shabaab.
During the Minnesota visit, Acting Under Secretary Szubin highlighted a number of initiatives underway to help address the core concerns on the receiving end of the remittances. For example, Treasury, the State Department, and the World Bank are taking important steps aimed at training and staffing Somali government regulators, assisting them with developing effective regulations, and helping those involved with remittances to confirm the identities of end-recipients. We also stressed the need for the Somali government to pass anti-money laundering/counter-terrorist financing legislation, which would mark a foundational step in the development a regulated and supervised financial sector in Somalia.
Acting Under Secretary Szubin also noted that, while Treasury recognizes that some Somali money transmitters are having difficulty maintaining banking relationships, we understand that some continue to maintain bank accounts and that, overall, remittances are continuing to go to Somalia, based upon our discussions with key parties both in and outside of Somalia.
Yesterday’s trip builds on an extended history of work on this issue, including, a public hearing that Treasury hosted earlier this year to hear directly from industry stakeholders about the issue of money services businesses’(MSB) access to financial services. Also, our Office of Technical of Assistance is now providing basic training to the Central Bank of Somalia’s Supervision Department on the risk-based approach to supervision of financial institutions. Additionally, Treasury’s Financial Crimes Enforcement Network issued a statement clarifying that banks can bank even high-risk MSBs, including money transmitters, if they have appropriate controls in place.
Treasury will continue to work with Rep. Ellison, the Minnesota delegation, and other concerned Members of Congress to support their constituents’ families and communities in their home countries.
The Story was republished from U.S. Department of Treasury.