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Use of Cash a potential terrorist activity

By Jonh Bhuru
Everyday cash activities are now considered to be potential terrorist activities by the US government as the American intelligence says paying for something as petty as a kombi fare with cash is a potential terrorist activity since no one keeps a record of informal cash transactions.

For terrorist groups, there are several types of risks they might face depending on the method of fund transfer. Among the most obvious risks is that the transfer itself will be detected by authorities. For example, a transfer between two banks is much more likely to be monitored, recorded, and discovered, than a transfer of cash that goes beyond borders that might be between Zimbabwe and Mozambique or between Zimbabwe and South Africa. A related element of risk comes from the varying degrees of anonymity associated with each method of moving funds. Some methods, like formal banking, require institutions to follow “know your customer”.

With the highly sort after US dollar circulating in Zimbabwe a lot of African terrorists have resorted to the country for cash supplies considering the porosity of our borders, having cash from Zimbabwe is like taking candy from a baby, with our eastern boundary with Mozambique where dealers can smuggle goods like a whole truck of second hand clothes or even a head of cattle which makes cash smuggle a much more smaller heddle as cash is usually smuggled in more smaller packages compared to goods that have been traditionally smuggled out of Zimbabwe

Using couriers to move physical cash is the simplest and oldest way of moving value. When criminals move cash across international borders, they typically conceal it in vehicles, packages, luggage, or anything else that can hold large physical volumes of cash. Oftentimes, where borders are uncontrolled or where the state’s resources are strained, criminals do not even conceal the cash.

However using cash is terribly inefficient and expensive. It is partly down to consumer habit, coupled with a popular mistrust of banks in countries such as Zimbabwe that have suffered financial busts. Another factor is that millions of poor households in Zimbabwe, still do not use banks. Criminals, terrorists and tax-evaders also tend to use cash for their operations, particularly large denomination bills.

The other factor, though, is the behaviour of central bank itself. One unintended consequence of super-loose monetary policy is that it has reduced incentives for consumers to store their money in banks.

Illegal dealers and militants generally do not use bank accounts or mobile payments. So one way to cut terrorism and crime might be to withdraw the big denomination bills or abort to use of the highly attractive US dollar from our system.

Using cash to move money out of Zimbabwe is much more convenient than using formal banks. Likewise, al-Qaeda’s alleged trade in West African conflict diamonds was more convenient than using cash or gold to move funds. West Africa is geographically distant from South Asia, but diamonds are easy to hide, This could also be the case in Zimbabwe where the government claims to have been duped diamonds worth over $15 Billion.

A wiser move will be to adopt the plastic money system and take advantage of Bond notes that will only carry a monetary value in Zimbabwe

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