In a recent blog "Anti-Money Laundering Regulations: Can Somalia survive without remittances" the
This is a timely reminder. Following the inaugural meeting of the
It is worth re-emphasising that the crisis for Somali remittances was caused by a broken banking system and the subsequent response of regulators - not by Somali money transfer operators (MTOs).
This is a point which is certainly acknowledged by DFID and all other participants in the
The opening paragraph of official replies usually asserts that "the government recognises the important role that remittances play in supporting the people and economies of developing countries and the use of money service business (MSB) services by
All well and good, but then the template continues: "As you will be aware, MSBs are a high risk sector for banks. The Government estimates that £1.5 billion is laundered through MSBs every year".
For those seeking a solution to the Somali situation, this wording is distinctly unhelpful. In effect, it places the blame for the current crisis squarely at the feet of MSBs while exonerating the risk management of
As a blanket statement, it also confers guilt on all MSBs without drawing any sectoral distinctions between, for example, forex brokers, bureaux de change and remittance MTOs.
For companies and sectors unfairly tarnished in this way, mounting an effective defence is the stuff of
Of course the
In private, the
As Somali MTOs prepare to work with government, some new wording in official correspondence and statements on Somali remittances which omits the guilty-by-association cast would surely lead to more constructive discussions.
On a related topic, it was announced last week that the
Somalis no doubt hope that the
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