By Abdullahi Mohamed

Dalsan was the second largest money-wiring Somali owned company. The company’s mission was to provide fast, efficient, and reliable service to Somalis working overseas who want to send money to their families and relatives living inside the country. The company had main offices in Nairobi, Kenya; Dubai, United Arab Emirates; London, UK; several states in the United States including Minnesota.

Starting from mid 2004- to April 2006, the founders of the company started selling shares to hundreds of investors. Finally, On May 2006, the company collapsed because of financial trouble. Ironically, the company officials have not reponded to the public about the causes of the of collapse, what they are going to do about it, and where is investors’ money ?

Personal story:

I would like to share my financial tragedy with the public so it can be a lesson to the future investors. Think deeply before you put your hardworking money into somebody’s hands. As Somali nationals, we usually follow stories about armed warlords that are fighting on gaining the power of Somalia. Beware! there are an emerging warlords who are trying to get all your money and get away with it, taking advantage of lawlessness and the Diaspora that happened to the Somali people. As far as I know Dalsan administrators are the latest perpetrators of such large-scale fraud schemes.  They collected more than  $ 10 million from the Somalis living all over the world, after eluding them of what they described as risk-free investment, and today these administrators have pocketed all the money and left the people who trusted them in the darkness without informing them how things have happened and without saying if they have any plans in hand of  giving  people’s money back.

To give you victim’s perspective about Dalsan’s fraud, first I thought it was like a dream to me. I tried my best to think positively. Then I thought investors would get their initial investment but sacrifice the profits of those glowing years. I believed that every administrator would try to protect the money for the people who trusted them. What a naïve thought!

 Finally, the reality touched me or I touched the reality. It become clear to me as a broad daylight that my money is gone forever and it is in the hands of group of mobster who still considers it as a part of their fortunes. They are Somali Mafia who horded nearly ten million dollars into their accounts.

I would like to divide Dalsan Fraud scheme into three steps process: input, operations, and output:

Input: which defines how Dalsan administrators collected millions of dollars from thousands of people living around the world. In year 2004 Administrators and founders  have used the following input efforts inorder to attract more $$$ as the company was financial bankrupt

-         Holding a meeting in Nairobi in mid 2004 in which they planned  a way to collect money from the Somali communities around the world.  Dalsan officials decided to send representative to major cities inhabited by the Somali community. These envoyes were carrying highly designed solicitations.

Mohamed Farah ( Daafeedow)  was assigned to go to Minneapolis where I met with him. He was telling prospective investors that Dalsan has free-risk money-wiring business basing the reason that : They have established a computerized accounting system that doesn’t allow any of their branches to send money unless they have equivalemt  amount of deposit with Dalsan. He also told us that branches have guarantors who posses big shares with Dalsan. He promised that there is no way that Dalsan losses money. I heard him saying Hawala is one of the safest investments. 

He was bragging that Dalsan is run by experienced professional accountants and managers who know well their responsibilities and task.

-         He also assured us that if it comes to the worse, Dalsan has enough asset properties such as buildings, guaranting public investments.

-         In addition, he named famous Somali figures who have big shares in the company who watch, according to him, company’s periodic operations.

-         He was also telling us that Dalsan is the second largest money wiring company operating in Somalia. “ Soon it will be the first” he added.

Operation: let talk about what investors didn't know but really was happening inside Dalsan at the time: It is very important to note that the financial misuse that swept almost ten million dollars from Somali overseas working people as well as psychological abuse that touched thousands of  Dalsan investors have not received the media attention it deserves. Most of the victims are shocked and they don’t where to go for help.

Here are number of tactics that Dalsan insiders were using:

-         Inflating the profit by issuing individual semi-annual financial statements, showing more than 15% yearly investment growth.

-         A large number of Dalsan  managers were receiving more than $50,000 salary in cash, assumingly paying no taxes.

-         Dalsan officials were traveling to anywhere at anytime they want while charging the traveling airline tickets, hotels, taxis, and overtime to Dalsan. 

-         Cashing and withdrawing their shares from the company. None of Dalsan official lost money after its collapse.

-         All Dalsan managers have been running their own  personal business, while using cash from Dalsan. According to insiders, most of the cash were misused in borrowing cash from Dalsan and never returning it back. In addition, some of the insiders have been for years running their personal business in buildings belonging to Dalsan and paying no rent to anyone. What a chance! What a Scum!

-         Creating false shares to friends and family members and then cashing them.

-         The outside personal wealth of Dalsan officials have at least tripled. They have existing and flourishing business and real-estate properties in Australia, Kenya, United Arab Emirates, Zambia, Egypt, Somalia, and even in Europe and United States.

Output: The administrators who pocketed this huge amount of money are the winners while the investors who were left in the darkness and deprived from their little saving are losers of the year. Here are some of tactics that Dalsan management is playing now:

-         Management and owners stopped talking to the public.

-         Dalsan officials were not answering phone calls.

-         Insiders became busy to scramble what is  left.

-         Insiders have no plans to give back money to the investors.

-         Victims are feeling stress, sleeplessness, and confusion.

-         Dalsan insiders and operators do not have any remorse of what happened.

-         Insiders started fingerpointing and blaming each other.

-         Insiders established  new business and act as they have nothing to do with the  financial disaster.

-         Telling  lies after lies.

Conclusion:

Fraud is an intentional deception whereby persons deceived are deprived of money or other properties. Embezzlement fraud happens when a person lawfully entrusted with another’s money takes it for his own use and attempts through false entries in the records of the rightful owner to conceal the fact that the money is missing.

Embezzlement differs from larcenery in two ways: first, embezzlers must had the right to posses the item e.g. money. Second, embezzlers use their position of trust to convert property or fill the blank. Embezzlement usually involves falsification of records in order to conceal the theft.

Dalsan embezzlement scheme, which was very successful to its founders, managers and friends, have continued for many years before detected. They used professional

skills of concealing the real balance sheet of the company from the investors.

In Dalsan Money wiring, managers were reporting annual statements to investor, using illusory inflated profits for 2 reasons: to retain their investors, while most of them were increasing their deposits because of willing to get more profit, secondly, the inflated profit reports were attract more and more new investors around the world to put their money in Dalsan.

Highly compensated bosses and their managers can stick their head in the sand and blame others for the collapse of the company. These men should be judged for embezzlement fraud.

Justice should be served in international level. The dollar amount involved with fraud is so huge that it has direct and indirect financial impact on millions of Somalis living inside the Somalia, Kenya, Europe, United States, Middle East and Australia. They were plundering the money for their personal benefits.

Dalsan case stands for a Somali white-collar crime which is today limited within the Somalis, but surely their crime will expand to the other communities around the world.   If they get away with this crime, surely they will get into deeper pockets that may shake some of international financial institutions. The western civilized world should take an action from Dalsan and their business affiliates.

These are allied financial warlords attacking the little saving of their people living overseas. I feel they are worse than the armed warlords who are now fighting in Somalia.

These financial mobsters have established flourishing business and bought land, luxury hotels, mansions in Kenya,Zambia, Egypt,  United Arab Emirates, Europe,United States, and Somalia.

I would like to conclude by quoting one line  fromMohamed Hadrawi’s poetry:

“ Allahayow nin daacad ah, Allahayow nin  daalina deeqdaada  haw simin”

One advice to the victims:

Please report whatever you know about and whoever you know involved in this fraud to your nearest authorities. Don’t let somebody else enjoy your hardworking money. International communities can cooperate to arrest these mobsters.

Abdullahi Mohamed

E-mail: [email protected]