Duhaime's Law Dictionary

Hawala Definition:

Arabic: a form of international money transfer often used to conduct money laundering.

Related Terms: Money Laundering

In US v Elfgeeh, Justice Kersh reiterated this description provided by FBI witnesses;

"A Hawala operates in a similar fashion to a Western Union business. It's a money transfer operation.

"The word Hawala translated from Arabic into English means transfer. Hawala business is used to send money from one location to another.

"(Re) the benefits of using a hawala instead of using an official money-transmitting business such as Western Union, one, it's conducted outside the realm of licensed banking activity. There is no regulatory oversight. Therefore, the transactions are basically conducted without any sort of legal review of how the transactions are conducted.

"It also enables the transactions to occur without any review by banking officials that they are conducted in accordance with procedures and laws which govern banking activity....

"The true originator of the funds and the true beneficiary of the funds are not identifiable in the banking transactions."

Canadian Jurist C. Duhaime writes:

"A hawala is an informal system of money transfer whereby funds are transferred by customers to a hawala operator, called a hawaladar, in one country and disbursed to recipients in another country by other hawaladar associates."


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