U.S. Bank to help Somalis with money transfers to relatives

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U.S. Bancorp, parent company of U.S. Bank, will soon offer money transfer services to let Somalis living in Minnesota send money to their families in east Africa, the Associated Press reports.

MPR says the Minneapolis-based lender has agreed to open an account with Dahab-shil, a Minneapolis money service business.

Many banks stopped handling the transactions more than a year ago over concerns they could unknowingly be violating federal rules against funding terrorism.

Minnesota is home to the largest population of Somalians in the U.S., many of whom send money to Africa to support their families.

Meanwhile, U.S. Bancorp posted a net income of $1.4 billion for the first-quarter that ended March 31, up 6.3 percent from a year earlier, Twin Cities Business reports.

“As predicted, fee revenue in the first quarter was impacted by a reduction in mortgage-banking revenue, as application volumes dropped for our company and the industry,” Chairman, President and CEO Richard Davis said in a statement.

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Money transfer businesses still serving Somalis

The Fourm of Fargo-Moorhead reports three money transfer brokers are still operating in Moorhead. Sunrise Community Banks ended the wire service to Africa in late December. Banks fear they could unknowingly be violating federal rules against funding terrorism. Minnesota is home to 25,000 Somalians, many of whom send money to Africa to support their families.

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Minnesota Somalis are worried after news that the money transfer company that handles most of the community's transactions with Somalia is shutting down amid fears that it may have a hand in routing cash to terrorists. Federal officials say Somalis in America send $100 million a year back to relatives in Somalia, which lacks a formal banking system.

Somali money transfers are flowing, but future is uncertain

The Star Tribune reports most of the shops have reopened, but they're using out-of-state banks or credit and often refusing to name their new business partners. Many U.S. banks have stopped wiring money to Somalia because they fear they'll violate new federal rules aimed at clamping down on terrorism funding.