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Why is it that Great Britain is now faced with Islamic extremism every where they turn? They have 12 Shariah courts, publicly-funded Shariah Islamic education, welfare benefits for up to four wives for every Muslim man, honor killings, children falling off school rosters and suspected of being forced into child marriages, raging domestic violence and spousal abuse, and "no-go" zones where even British police are afraid to enter for fear of Islamist violence.
Britain’s policy of “outreach” to the Islamic community has failed to accomplish what it hoped to accomplish. A critical aspect of this “outreach” has been Britain’s embrace of shariah finance. As Prime Minister Gordon Brown declared in 2006, London was going to be the Islamic Banking Capital of the World. Why? Money. And he got it.
At the June 13, 2006 Islamic Finance Trade Conference in London, Brown revealed,
"Today British banks are pioneering Islamic banking - London now has more banks supplying services under Islamic principles than any other Western financial centre."
Because so many top business leaders, university professors, government officials, and religious leaders in Great Britain have bought into the fiction that Shariah Banking is just a harmless religious requirement for Islamic investment, there are few there in positions of leadership left to fight against Shariah. The re-thinking of some of the British policy regarding the connection between Islamist doctrine and terrorism, can such a shift actually occur with Britain so beholden to Shariah finance and its money?
For those of you who have seen Joy Brighton's video about Shariah finance, you know that one of the leading "Shariah finance scholars" himself, Sheik Qawadari, describes Shariah Banking as "Jihad with Money." You know the story of what Shariah Banking is, its connection to the Shariah Law of Saudi Arabia, Iran and the Taliban, and you know its creation as a tool of political Islam to control global economics is not being told.
You also know that Shariah is already here in the U.S., thanks to the acceptance of Shariah finance by institutions such as Citibank, HSBC, UBS and AIG, and the lack of oversight by the SEC and U.S. Treasury Department. As the headline in the Washington Times article below asks, is the West ready for this? Actually, the better question to ask is this: Does the West understand that the embrace of Shariah finance is the eventual embrace of brutal and oppressive Shariah law?)
By Simon Roughneen
SINGAPORE | Backers of Shariah-compliant finance see an opportunity for expansion amid the global economic downturn, and some Western banks are welcoming this growing source of new business.
"Islamic bankers should do some missionary work in the Western world to promote the concept of Shariah banking, for which many in the West are more than ready now," Indonesian President Susilo Bambang Yudhoyono said at the World Islamic Economic Forum last month in Jakarta.
Such statements have given rise to fears that Shariah finance is a stalking horse for hidden political or religious aims. Shariah finance is an extension of Islamic law, pushing a faith-based alternative to Western banking.
Key Islamists who advise Shariah financial houses have called for full Shariah law to be adopted in Western countries and, in some cases, have made statements supporting terrorist groups.
Shariah finance means institutions and norms that fit with Islamic law. Fully compliant Islamic financial institutions are prohibited from interest payments and require transactions to be backed by tangible assets.
Speculation and hedge funds are off limits — ditto for anything connected to porn, gambling, alcohol or pork. Shariah finance targets Muslims who want to avoid what are deemed "un-Islamic" Western banks or financial practices, and appeals to clients' faith as well as their bottom line.
The practice has its detractors.
"A shift from present global economic practices [in which many Muslims participate] to Shariah-based practice" would mean "an unacceptable intrusion into Western culture," said Stephen Schwartz, executive director of the Center for Islamic Pluralism.
Mr. Schwartz said the sector is arguably un-Islamic by contradicting the traditional Islamic teaching that "Muslims living in non-Muslim societies must accept the laws and customs of the countries to which they immigrate."
Depending on the measurements used, the Shariah finance sector manages assets of $700 billion to $800 billion, according to the Islamic Financial Services Board, an industry body. Standard and Poor's estimates that the sector could reach $4 trillion before long.
Shariah banks make up a small fraction of the global banking sector, and they may have suffered less than Western counterparts by being sheltered from the subprime crisis.
However, as Duncan McKenzie, director of economics at International Financial Services London (IFSL), told The Washington Times: "Islamic finance is one model but is by no means a panacea. The Islamic finance industry faces a number of challenges, including the need to standardize interpretation of Shariah law, harmonize tax and regulation of the industry, and develop the skills base."
Christopher Holton, vice president of the Center for Security Policy and director of its Shariah Risk Due Diligence Project, told The Times: "It is a myth that Islamic finance has provided a hedge against crisis. The FTSE Islamic Index has fallen 41 percent, and the all-world index 44 percent, similar losses over the past six months."
Shariah finance remains dominated by banking, but the sector is diversifying. A growing proportion — up to 20 percent according to some estimates — is taken up by sukuk, which is a Shariah-compliant bond issuance. Malaysia is a dominant base for this particular service. Bonds can play a key role in helping countries deal with the global economic crisis, but the global sukuk market has fallen for two years in a row, in step with the global downturn.
Despite the varying prohibitions, some Shariah banks find creative ways to make the equivalent of market interest rates by other means, such as by pegging debtor repayment rates to his or her future profits, or when a bank offers a "hibah," or gift to those who open an account — in essence a way of attracting new customers in lieu of interest accruals on savings.
Shariah finance likely will grow in coming years, with Saudi Arabia and the United Arab Emirates being followed by Indonesia, Turkey, Singapore and some Western countries as viable locations for expansion.
The IFSL recently published a detailed report on the sector highlighting how "the U.K. is getting ahead of the game, in Europe at least, in facilitating this sector" — as noted by Emile Abu-Shakra, media relations manager at British bank Lloyds TSB.
Lloyds stole a march on the competition by greasing the wheels for Shariah-compliant bank-to-bank transactions, and now Britain has a bigger Shariah finance sector than Egypt or Pakistan.
In total, 22 financial institutions offer Shariah-compliant services in Britain, compared with nine in the United States. However the American financial sector is eager to source and provide new products — among them Shariah finance.
American International Group Inc.'s December pledge to bring Islamic home insurance to the United States was met with a written rebuke by Rep. Sue Myrick, North Carolina Republican, and Rep. Frank R. Wolf, Virginia Republican, who warned that opaque charitable transfers made by Shariah finance advisers could end up funding terrorists.
Mr. Holton said some Islamic financial institutions have been implicated directly in bankrolling terrorists. "From 1988 to 2001, when it was designated a terrorist entity by the United States and the United Nations, Bank al Taqwa [registered in the Bahamas] transferred tens of millions of dollars to Hamas, al Qaeda, the Taliban, and others," he said.
An elite cadre of scholars dominates the advisory boards of Shariah institutions, and these same thinkers are often called by Western institutions who want to develop Shariah-compliant products. However some, such as Sheik Yusuf al-Qaradawi, are banned from entry into Britain and the United States for making statements supporting Islamist terrorism, while another, Mufti Taqi Usmani, who has advised the Wall Street Islamic index, has promoted extension of full Shariah law into Western countries.
Most troubling, perhaps, is the appearance of Bank Melli of Iran at the top of a listing of the world's top 500 Islamic financial institutions, published by the Banker in November 2008 and reproduced in the IFSC report. Bank Melli is under U.S. and EU sanctions for facilitating Tehran's support of Hamas and Hezbollah and funding Iran's uranium enrichment program. In total, Iran has six of the 10 biggest Shariah-compliant institutions and double the Shariah assets of any other country.
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