NELSON INSTITUTE DIRECTOR’S COLUMN EXPOSES ELABORATE FINANCING SCHEME FOR SOMALIA’S ISLAMIST WARLORDS

September 21, 2006

HARRISONBURG— In his weekly column for the World Defense Review, Dr. J. Peter Pham, Director of the Nelson Institute for International and Public Affairs at James Madison University, exposes an elaborate financing scheme that channeled resources to the warlords of Somalia’s Islamic Courts Union while operating openly in the United States and other countries until earlier this year.

The scheme was built around the Dalsan money transfer company moved an estimated $100 million annually, netting its owners between $400,000 and $500,000 per month. In early May 2006, Dalsan folded its operations without warning, taking with it not only the $10 million to $30 million in capital invested by individual shareholders, but an estimated $9 million to $12 million in unconsummated money transfers from ordinary customers. Citing the close ties the firm’s principals have with leading radicals, the article asks: “Is it still another mere coincidence that the extremist forces within the ICU received a massive infusion of arms and men in the same month that Dalsan collapsed—reinforcements that tipped the scales in the Islamists’ battle with U.S.-backed factions for control of Mogadishu?”

Dr. Pham’s essay, “Financing Somalia’s Islamist Warlords,” can be accessed online by clicking here.