This is well known, and is detailed in this article. But Western financial institutions seem to be focused only on the bottom line. “Shariah bankers: West ready for faith-based alternative,” by Simon Roughneen for the Washington Times, April 13:
SINGAPORE | Backers of Shariah-compliant finance see an opportunity for expansion amid the global economic downturn, and some Western banks are welcoming this growing source of new business.
“Islamic bankers should do some missionary work in the Western world to promote the concept of Shariah banking, for which many in the West are more than ready now,” Indonesian President Susilo Bambang Yudhoyono said at the World Islamic Economic Forum last month in Jakarta.
Such statements have given rise to fears that Shariah finance is a stalking horse for hidden political or religious aims. Shariah finance is an extension of Islamic law, pushing a faith-based alternative to Western banking.
Key Islamists who advise Shariah financial houses have called for full Shariah law to be adopted in Western countries and, in some cases, have made statements supporting terrorist groups.
Shariah finance means institutions and norms that fit with Islamic law. Fully compliant Islamic financial institutions are prohibited from interest payments and require transactions to be backed by tangible assets.
Speculation and hedge funds are off limits “” ditto for anything connected to porn, gambling, alcohol or pork. Shariah finance targets Muslims who want to avoid what are deemed “un-Islamic” Western banks or financial practices, and appeals to clients’ faith as well as their bottom line. […]
Shariah banks make up a small fraction of the global banking sector, and they may have suffered less than Western counterparts by being sheltered from the subprime crisis. […]
Christopher Holton, vice president of the Center for Security Policy and director of its Shariah Risk Due Diligence Project, told The Times: “It is a myth that Islamic finance has provided a hedge against crisis. The FTSE Islamic Index has fallen 41 percent, and the all-world index 44 percent, similar losses over the past six months.”…
American International Group Inc.’s December pledge to bring Islamic home insurance to the United States was met with a written rebuke by Rep. Sue Myrick, North Carolina Republican, and Rep. Frank R. Wolf, Virginia Republican, who warned that opaque charitable transfers made by Shariah finance advisers could end up funding terrorists.
Mr. Holton said some Islamic financial institutions have been implicated directly in bankrolling terrorists. “From 1988 to 2001, when it was designated a terrorist entity by the United States and the United Nations, Bank al Taqwa [registered in the Bahamas] transferred tens of millions of dollars to Hamas, al Qaeda, the Taliban, and others,” he said.
An elite cadre of scholars dominates the advisory boards of Shariah institutions, and these same thinkers are often called by Western institutions who want to develop Shariah-compliant products. However some, such as Sheik Yusuf al-Qaradawi, are banned from entry into Britain and the United States for making statements supporting Islamist terrorism, while another, Mufti Taqi Usmani, who has advised the Wall Street Islamic index, has promoted extension of full Shariah law into Western countries.
Most troubling, perhaps, is the appearance of Bank Melli of Iran at the top of a listing of the world’s top 500 Islamic financial institutions, published by the Banker in November 2008 and reproduced in the IFSC report. Bank Melli is under U.S. and EU sanctions for facilitating Tehran’s support of Hamas and Hezbollah and funding Iran’s uranium enrichment program. In total, Iran has six of the 10 biggest Shariah-compliant institutions and double the Shariah assets of any other country.