For years the world has struggled against terrorist threats and the extremism, collapsed states, dictatorships and political and economic turmoil associated with terrorism. An important focus of this struggle has been to identify how terrorist groups receive and move financial assets and how to intercept funds and cut off the financial lifelines. Following the 11 September 2001 attacks, investigators revealed that some of the assets used to finance these acts were channelled into the United States via an ancient financial practice called hawala – an Arabic word to indicate a transfer. An earlier Centre publication, Illicit Money and Informal Avenues, examined how international migration patterns have kept informal value exchange systems such as hawala in high demand, and how the methods by which hawala transactions are conducted make it an ideal way to move assets to and within locations where a formal financial sector has not yet developed.

Ann Griffiths is professor, Dalhousie College of Continuing Education, Dalhousie University.Karl Nerenberg is director of public information and senior editor, Forum of Federations.

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