Money remittance firms serving U.S.-based Somalis have more than doubled their monthly cash declarations at border crossings since last spring, according to data provided by an American official. The jump closely aligns with a decision in February by Merchants Bank of California to drop its accounts for money services businesses linked to Somalia, said the U.S. Immigration and Customs Enforcement official. The bank was at the time the largest financial conduits for Somali expatriates in the United States to send money to the Eastern African nation. Prior to the closure, couriers working for the MSBs declared several millions of dollars...
Drug traffickers and other criminals are increasingly seeking out indirect relationships with community banks and credit unions to move and launder their illicit proceeds after being turned away by larger financial institutions, say sources.
Money services businesses on a sanctions list in Kenya targeting terrorist organization Al-Shabab will have their licenses reinstated but face enhanced scrutiny going forward, the head of the country's financial intelligence unit said.
U.S. bank restrictions have exacerbated the troubles of Somali money services businesses to the point that companies and individuals alike are resorting to complex workarounds to send money to the East African nation.