Opinion: How Dahabshiil Group subvert the rule of law and governance in Somaliland

This week the CEO of Dahabshiil Group aka Dhiigshiil (“The blood Smelter”) in Somali, Abdirashid Duale, has denied that his group has nothing to do with the riots and the mob violence orchestrated by the desperate, one- clan based Waddani party in Hargeisa. But there was a video showing Hersi Hassan, a former employee of Dahabshiil and the leader of Waddani party, and other party hacks using Dahabshiil 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 Dahabshiil bank, which is not an actual 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 a close ties with communist China and severing relations with Taiwan, Somaliland’s closest friend, if he wins the 2022 presidential election.

Subverting the rule of law, deception, bribes, and undermining governance are Dahabshiil 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 Treasury to do a thorough investigation about the financial relationship between the despicable human being Hersi, Waddani party and Dahabshiil. Who is financing the mob violence and the ‘hate factory’ media that are tearing down Somaliland public safety and cohesiveness nowadays?

The founder of Dahabshiil, Mohamed Duale, started his business at a tiny grocery store in the dusty town of Burao. Then in 1980’s he operated Dhiigshiil money transfer business for the Somali workers in the Arabian Gulf. His business exploded after the shutdown of Al-barakat money transfer 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.

Dahabshiil 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 Dahabshiil to even appoint key Somaliland cabinet Ministers: in 2010, one of those appointments included Hersi who was a former employee of Dahabshiil to become senior aide to President Silanyo whose health was rapidly deteriorating. Hersi and Dahabshiil, took advantage the poor health of the president Silanyo, to a point that they took over the whole Somaliland government.

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

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

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

Dahabshiil’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 selling at a staggering price close to $150,000. For example, a former cabinet minister is living there.

Dahabshiil’s looting 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 Dahabshiil 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.

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Without regulations, weak government and corruption have enabled Dahabshiil to get involved in any kind of business, including fuel business. Hersi allocated a 20-acre land for Dahabshiil 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 Dahabshiil’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, Dahabshiil 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 Dahabshiil at a higher exchange rate. The criminal syndication allegedly went on for years until Hersi was eventually fired from his post by the former 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 Dahabshiil up to now.

It is a shame that Hersi gets up every morning 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 Dahabshiil corruption and excess?

Because the Dahabshiil group have silenced, censored, or bought out any media trying to expose their lawlessness and corruption. They also bribed or offered jobs to the relatives of the government officials, prominent clergymen, community leaders to silence them, especially those from north Hargeisa in which most of their businesses depend on.

Blame also, 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 Dahabshiil 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 Dahabshiil Group should have been accountable for their alleged transgression. We need a special prosecutor to investigate him and Dahabshiil 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 Dahabshiil.

But ignoring Hersi’s and Dahabshiil 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 Dahabshiil 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 Dahabshiil Group, Kulmiye and Waddani parties for profit at the expense of ordinary Somalilanders

Ali-Guban Mohamed

Founder and Editor, Gubanmedia.com, an online source of news and commentary about the Horn of Africa

aliadm18@gmail.com