THE PROGRESSIVE CONSERVATIVE, USA
An Online Journal of Political Commentary & Analysis
Volume X, Issue # 312, November 26, 2008
Dr. Almon Leroy Way, Jr., Editor
Government Committed to & Acting in Accord with Conservative Principles
Ensures a Nation's Strength, Progress, & Prosperity
U.S. GOVERNMENT EMBRACES ISLAMIC BANKING
By Supna Zaidi
THE DANGER OF SHARIA-COMPLIANT FINANCE (SCF): ITS POTENTIAL CONNECTIONS TO ISLAMISM, AMERICA'S
ENEMY IN THE GLOBAL TERROR WAR -- THE LIABILITY THAT WOULD ATTACH TO PRACTITIONERS OF SCF WHO DO NOT
UNDERSTAND THE POTENTIAL SEDITIOUS NATURE OF THEIR INVOLVEMENT -- THE MISTAKE THAT IS BEING MADE BY THE
U.S. DEPARTMENT OF THE TREASURY
FULL STORY:
On November 6, 2008, the U.S. Treasury Department hosted a seminar on Islamic banking to train government employees
on Sharia-compliant finance (SCF). According to a press release, it was "designed to help inform the policy community
about Islamic financial services, which are an increasingly important part of the global financial industry."
It is interesting to note that, while many in the West deride parallel societies, the lack of integration and overall
"foreign-ness" of its Muslim populations, they have no problem embracing Islamic banking. Maybe because this is the
one area of religious "encroachment" that allows the West to make money, and lots of it.
The U.S.A. is behind European nations like the United Kingdom and France, which are actively promoting Islamic banking.
The UK already offers:
Sharia-compliant car insurance;
Sharia-compliant credit cards;
Sharia-compliant mortgages.
Banking oversight in the United Kingdom is handled by the Financial Services Authority (FSA), a non-governmental body
whose members are appointed by the Treasury. The FSA does not regulate the Sharia compliance of Islamic financial
products, deferring instead to the Sharia Supervisory Board (SSB) of the financial institutions it has approved. Such
religious deference, especially when the U.S.A. is still engaged in a "war against terror," is a serious concern to critics of
SCF.
One critic, the Coalition to Stop Sharia, hosted a press conference on the same day to reiterate its concerns, which were
previously presented to various financial heads, but were ignored. The Coalition joins various organizations that do not
want SCF practiced in the United States because of its potential connections to Islamism, the enemy in our "war on terror,"
and the liability that would attach to practitioners of SCF who do not understand the potential seditious nature of their
involvement.
Speakers included: Robert Spencer, author of Stealth Jihad; Frank Gaffney, Center for Security Policy; Dan Pollak
for Morton Klein, Zionist Organization of America; Andrea Lafferty, Traditional Values Coalition; among others.
The role of religion in secular and global institutions presents unique concerns that should be scrutinized, since true
checks and balances are not possible where deference to religious heads is unavoidable. In the case of SCF, only Sharia
scholars can decide whether a financial product is permissible (halal) or not. They are thus the only individuals who can
theorize as to why or how a product can become "halal." This removes the ability of all practitioners who are not part of
the SSB from engaging in product development beyond doing what they are told to find and prevent any illegality. If
questions of fraud, breach of duty, negligence, criminal liability, etc., arise over any transactions, these same individuals
will nevertheless remain liable.
Consider the current global crisis related to subprime mortgages as a point of comparison. Who did what and how is on
everyone's mind. Was the cause naïve consumers or predatory lending? Financial products are complicated as it is
without throwing the element of religion into it. Moreover, U.S. Secretary of the Treasury Henry M. Paulson, Jr., does not
have the answers, though he is in charge, with no apparent oversight.
In its worst-case scenario, SSBs act just as unilaterally, can go back on previous decisions, or contradict the decisions of
other SSBs. Who is right and who decides? What administrative body or court in the U.S.A. is in a position to question a
Sharia-based product? Even if transactions state New York as the jurisdiction for dispute resolution, the courts must
invariably rely on Sharia-based decisions from foreign courts for theories and interpretation. If a U.S. court offers a
decision based on its own theory, who will make the decision binding, since Sharia is divine, i.e., not to be superceded by
secular law?
Besides religion, subversive political goals are another unique element inherent in SCF that subprime avoided. Renat
Bekkin, international law lecturer at the Moscow State Institute of International Relations (MGIMO-University) and
proponent of SCF in Russia, stated in an interview to New Horizon, the oldest Islamic banking magazine in the
United Kingdom, that not all Muslims in Russia favor SCF because they see it as form over substance, like creating
Islamic whiskey.
For some other Muslims, Bekkin argues, "practicing all principles of Islam, including in the financial sphere, is essential."
This latter group concerns critics of SCF because they are part and parcel of the global Islamist movement. Advocates of
Islamism define Islam as a complete sociopolitical system that should govern one's personal and private life. This is a
20th-century phenomenon fueled internationally by oil profit in the Middle East. First articulated by non-scholars like
Syed Qutb, Abul Ala Mawdudi and Hasan al-Banna, this totalitarian ideology has evolved into the separatist Salafi
movement, which encourages segregating Muslims from non-Muslims through violent jihad and non-violent means.
The Coalition to Stop Sharia believes SCF is one such non-violent strategy, since the Islamist movement advocates
replacing capitalism and constitutional democracy with Islamic law, or Sharia. While many progressive Muslims argue
and reinterpret Sharia in ways compatible with universal human rights and constitutional democracy, their position
remains theoretical. In practice, Sharia remains an archaic understanding of human relations, as evidenced by Saudi
Arabia, Iran, Pakistan (in partial codification), etc.
In this context, practitioners of SCF who are Muslim and non-Muslim and who reside in constitutional democratic nations
like the United States put themselves in the position of unintentionally aiding and abetting seditious activity by
promoting particular SCF institutions, individuals, or transactions that are potentially Islamist. How we are to know what
is and is not is beyond the scope of the U.S. government or the U.S. banks that seek to profit from SCF.
Further, by not alerting consumers and clients of the "dark side" of SCF, these same practitioners are potentially failing a
duty of care by not providing material information from which a consumer can make what a court would consider a
well-informed decision.
Thus, it is a mistake for the U.S. Treasury to host a seminar to "inform" the public of SCF, without including the criticism.
Jumping into a new, little-understood industry like SCF, with the same zeal for profit evident in subprime lending, could
lead to new problems in the future. By addressing the Coalition's concerns, the government could create the appropriate
regulation, oversight, and transparency mechanisms to counter the possible threat Islamists present to the SCF industry.
Or simply realize that the shortterm gains are not worth the longterm dangers Islamism's mission against the West
presents.
LINKS TO RELATED TOPICS:
The Fifth Column -- America's Internal Enemies:
Disloyalty, Subversion, Sedition, & Treason
Lawfare -- The Use of Law as a Weapon in War & Politics:
Islamist Lawfare & the "Legal" Jihad Against America & the West
Islamism & Jihadism -- The Threat of Radical Islam
Page Three
Page Two
Page One
Middle East -- Arabs, Arab States,
& Their Middle Eastern Neighbors
American Foreign Policy -- The Middle East
International Politics & World Disorder:
War, Peace, & Geopolitics in the Real World:
Foreign Affairs & U.S. National Security
Page Two
Page One
Islamist Terrorist Attacks on the U.S.A.
Osama bin Laden & the Islamist Declaration of War
Against the U.S.A. & Western Civilization
Islamist International Terrorism &
U.S. Intelligence Agencies
Counterterrorism & U.S. National Security
U.S. National Security Strategy
Supna Zaidi is Assistant Director of Islamist Watch, a project of the Middle East Forum. She can be reached at
zaidi@meforum.org.
The foregoing article by Supna Zaidi was originally published in Pajamas Media, November 24, 2008, and
can be found on the Internet website maintained by the Middle East Forum, a foreign policy think tank which seeks to
define and promote American interests in the Middle East, defining U.S. interests to include fighting radical Islam,
working for Palestinian Arab acceptance of the State of Israel, improving the management of U.S. efforts to promote
constitutional democracy in the Middle East, reducing America's energy dependence on the Middle East, more robustly
asserting U.S. interests vis-à-vis Saudi Arabia, and countering the Iranian threat.
(Article URL: http://www.meforum.org/article/2014)
Republished with Permission of the Middle East Forum
Reprinted from the Middle East Forum News
mefnews@meforum.org (MEF NEWS)
November 26, 2008
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THE PROGRESSIVE CONSERVATIVE, USA
An Online Journal of Political Commentary & Analysis
Dr. Almon Leroy Way, Jr., Editor
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Conservative Government Ensures a Nation's Strength, Progress, & Prosperity