Investigative Reports

How Somalia is trying to Stifle Somaliland – US ties with an Online Troll and a pseudo-Charitable Organization

In February, June, and  August 2022, Mr. Okeke-Von Batten filed Lobby Disclosure Act...

Organized Corruption: How Government Appointees and Employees Are Pillaging Coffers through their Private Companies

According to Somaliland government records examined by Somaliland Chronicle,...

Guban View: How Dahabshil Group subvert the rule of law and governance in Somaliland 

Recently,  the CEO of Dahabshil Group, Abdirashid Duale, has denied that his group has nothing to do with the riots and the mob violence orchestrated by the desperate Waddani party in Hargeisa. But there was a video showing Hersi Hassan, a former employee of Dahabshil and the leader of Waddani party, and other party hacks using Dahabshil Damal hotel as the command-and-control center to stage the mob violence and hooliganism in the morning of Thursday, June 9. 

There are also serious allegations on social media that Dahabshil bank facilitated the wire transfer of the 3 million US dollars that Hersi used to buy out the leadership post of the Waddani party. The money came from a Chinese funded Somali fishing company in Mogadishu. After Hersi winning the leadership position, the Waddani presidential nominee Mr. Cirro called for close ties with communist China and severing relations with Taiwan, Somaliland’s closest friend, if he wins the 2022 presidential election.

Since foreign money funding our political parties could undermine our national security, for the government to protect against foreign meddling in national political parties and the integrity of our elections would be prudent.

Subverting the rule of law, deception, bribes, and undermining governance are Dahabshil modus Operandi to control Somaliland government and communities. And now, it is giving material support to those who are trying to undermine our peace and order just to control the Waddani party. 

Therefore, it is judicious for the Interior Ministry and the Somaliland (JSL) Treasury to do a thorough investigation about the financial relationship between Hersi-, Waddani party and Dahabshil. Who is financing the mob violence and the ‘hate factory’ media that are tearing down Somaliland public safety and cohesiveness nowadays? 

The founder of Dahabshil, Mohamed Duale, started his business at a tiny grocery store in the town of Burao. Then in 1980’s he operated his money transfer business for the Somali workers in the Arabian Gulf. His business exploded after the shutdown of Al-barakat money for allege ties to terrorism by the US treasury on September 11, 2001. He then deeply involved the Somaliland clan identity based political system by bankrolling the Kulmiye party, which drew its support from the East Burao area constituents. 

Dahabshil group contributed financially to the presidential campaigns of former President Silanyo of the Kulmiye party, because they were expecting a quid pro quo for their support of Kulmiye. But that arrangement allowed Dahabshil to even appoint key Somaliland cabinet Ministers: in 2010, one of those appointments included Hersi who was a former employee of Dahabshil to become senior aide to President Silanyo whose health was rapidly deteriorating. Hersi and Dahabshil took advantage of the poor health of the president Silanyo to a point that they effectively took over the whole Somaliland government. 

During the Silanyo/Hersi administration, the collusion between JSL government and Dahabshil was obvious. Hersi used every opportunity for Dahabshil to blatantly undermine the rule of law, judicial system, public safety and to bankrupt our treasury.    

What Dahabsiil has pulled off in Somaliland during Hersi tenure was extensive and the wholesale plunder of our country. Hersi systematically used the government as a vehicle to enrich himself and his cohorts, including Dahabshil by plundering aid money, public funds intended for development and infrastructure. 

Dahabshil used Hersi as a conduit to illegally acquire public lands and buildings, government contracts, and even Hargeisa Electric Utility without proper vetting, or public auction. 

Here is the Dahabshil heist of Somaliland resources that Gubanmedia has uncovered. Some of this looting was in public discussion, but the so-called JSL media failed to report 

For instance, please note the site for the Damal hotel used to be the Headquarters of Somaliland Traffic unit. They acquired it through bribes and illegal means with no proper vetting or public auction Everything was done in secrecy and in backroom deals. 

Moreover, Hersi gave Dahabshil, for free, the Hargeisa public Electric utility, with a customer base of 120,000, 300 plus employees, and assets close to $100 million. Dahabshil fired all employees who lost income to support their families. The monthly electric cost for the struggling Somalilanders was $10 a month. But after Dahabshil took over the utility and renamed it Sompower, the price of electricity went up 5 times. 

In addition, the Bihi administration provided Dahabshil a free grant from the World Bank totaling $20 million intended for the development of the Somaliland electric utilities sector. And now, they are raising the cost of electricity at a time when people are struggling with hyperinflation. 

Why should a private entity receive money intended for public use? 

Dahabshil’s greed and appetite for plunder continued unabated. It illegally acquired British colonial era officers’ townhouses in the Shacab area. Dahabshiil renovated those townhouses, and it is now selling at a staggering price close to $150,000. For example, a former cabinet minister is living there. 

Dahabshil’s looting also did not stop in Hargeisa; it moved 185 km east of Hargeisa, to the port city of Berbera. On March 2012, the Silanyo/ Hersi administration issued an executive order for Dahabshil to take over the old Berbera Cement plant without proper vetting, but it backed off after a group of elders representing the Sahel Communities (Dan iyo Duco) raised objection for the permit. 

Lack of regulations, weak government and corruption have enabled Dahabshil to get involved in any kind of business, including fuel business. Hersi allocated a 20-acre land for Dahabsiil to build fuel storage next to Berbera port, without proper vetting. It built 7 seven fuel storage tanks without approval or building permit from government agencies. These storage tanks are also hampering the expansion of Berbera port. 

But one the most devastating impact on Somaliland economy was Dahabshil’s manipulation of the value of SL Shilling. Before the Kulmiye party took over the power the value of SL Shilling used to fluctuate between 5,500 -6,500/ USD. 

While coordinating with Hersi, Dahabshil group, who run a money exchange business, started a scheme of buying SL shilling at a lower price and then hoarding it. Then the value of SL Shilling peaked. For the government to stabilize the shilling, it started buying back the shilling from Dahabshil at a higher exchange rate. The criminal syndication allegedly went on for years until Hersi was eventually fired from his post by the first lady Amina Weris.  

According to some estimates, it cost Somaliland taxpayers close to $45 million. This was the biggest wealth transfer from poorest people to one of the richest companies in Somaliland. I have heard that the JSL government is still paying that debt to Dahabshil up to now. 

It is a shame that Hersi gets up every morning to get from a JSL owned $450,000 villa, in Goljano area that he said Silanyo gave him as a gift as though Silanyo was a king while the widow of the founder of Somaliland, Egal, has no place to call home in Hargeisa.

So why was not a public outcry, or objection to Dahabshil corruption and excess? 

Because the Dahabshil group has silenced, censored, or bought out any media trying to expose their lawlessness and corruption.

They also bribed the government officials, prominent clergymen, community leaders to silence them, especially those from north Hargeisa in which most of their businesses depend. 

Blame also the Somaliland legislature which became an extension of the Silanyo/Hersi administration when Cirro was the speaker. Instead of upholding the rule of law and holding the government accountable, Cirro has played a central role of facilitating the Dahabshil land corruption, to accumulate wealth for himself. 

Add also to the smear and distractions the clan identity politics of Kulmiye and Waddani parties. 

Mr. Hersi and Dahabshil Group should have been accountable for their alleged transgression. We need a special prosecutor to investigate him and Dahabshil on allegations of power abuses and corruption, and theft. And if President Bihi fails to appoint a special prosecutor to investigate, many people would think that Bihi himself is complicit in covering up their misdeeds, or a puppet of Dahabshil. 

But ignoring Hersi’s and Dahabshil power abuses and corruption would only invite more abuses, more theft of public funds and lands, and more nepotism. 

The Alternative would be for Bihi to become another African leader who tolerated corruption and abject poverty to his own people, and denied them the opportunity to improve their lives, while the few greedy and rich money transfer and communication oligarchs such as Dahabshil became powerful enough to control our government, like Gupta brothers of South Africa, to undermine the rule of law and the integrity of the country. 

Finally, we must push back the collusion between Dahabshil and Kulmiye and Waddani parties for profit at the expense of ordinary Somalilanders.

ABOUT THE AUTHOR:

Ali-Guban Mohamed
Founder and Editor

Disclaimer: The viewpoints expressed by the authors do not necessarily reflect the opinions, viewpoints of Somaliland Chronicle, and its staff. 

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Notice: This article by Somaliland Chronicle is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License. Under this license, all reprints and non-commercial distribution of this work is permitted.

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