DAYS after a classified report was leaked, suggesting that Peshawar’s currency exchange market is a hub of the illicit trading of money and a major source of terror financing, I thought the market would be in a panic.
But the historic Chowk Yadgar market, known for the money exchange business, reflects no signs of fluster. The usual rush of customers buying or selling international currencies continues.
As I enter the market, people sitting on carpets or behind glass counters displaying currencies from several countries stare at me, evaluating whether I could be a potential client. For my part, I’m looking for a suitable host who could divulge some information.
There are Pakhtuns here, some Hindko-speaking, and many Afghans. I scan the market, which takes a turn behind the famous Chowk Yadgar Kulfa Faluda shop (and selling chicken corn soup in the winter).
I spot a possible hundi (informal money transaction) dealer and approach him through my friend, a local, who asks him in Pashto to cooperate for a transaction from Saudi Arabia. The man, in his early 30s, with Central Asian features and a Pashto dialect that confirms him as an Afghan, tells us to go to the bank. I say that bank charges very high and I’m looking for another option. He asks about the amount and my friend tells him it’s 20,000 Saudi riyals.
He ponders for a moment, then signals towards a plaza and tells us to ask for a man called Ilyas.
In that building, a few yards ahead of the Afghan dealer’s tiny shop, people are having lunch, sitting on carpets behind their counters. We can’t find Ilyas. Then finally, we enter a shop where four men — apparently from the tribal belt — have just finished their meal. Again we ask for assistance to receive money from Saudi Arabia. One of them writes a name on a piece of a paper, and guides us to another building close to Chowk Yadgar Kulfa Faluda shop. There, a man signals towards the second floor.
Upstairs, on a small balcony, about a dozen men are sitting on plastic chairs. They are waiting for their turn to get money from the man behind a locked glass counter which is protected by a steel grill. My friend approaches him and hands him over the chit. He directs a probing look at us, then advises us to go downstairs and see his brother.
Down we come and meet his brother, a man in his 40s. He is very careful in his conversation.
“How much money will be sent to you?” he asks.
“At least 70,000 Saudi riyals from Riyadh to begin with,” my friend says. “We’re expecting some amount from the UAE too.”
“Okay, we’ll handle it. Just come to me when you need to get the money,” he says. “We will deliver it to you, but not at this shop, at my house, because the authorities are always after us.”
“Why are the authorities after you?” I ask.
“There are a number of spies here in this market, who sniff around as to which dealer has currencies in bulk. When they confirm it, a robbery takes place and all the money is taken. These spies and FIA [Federal Investigation Agency] men are making money from here,” he replies.
“But the large trade of dollars is still continuing in this market and dollars are being smuggled to Afghanistan?”
“It’s everywhere, dollars come here from Kabul too,” replies another dealer in the shop.
“So what if I need to buy dollars?” I ask.
“How much you need?” the first dealer shows interest.
“Twenty thousand at the moment, but I will buy more later.”
“Okay, we will provide you as much you require. But not here, at our house.”
We leave the place with a promise to contact them when the transactions are ready.
On taking another round of the market, we enter a three-storey building where the shops are closed but a few dozen men have gathered in the courtyard and are shouting.
“What is going on here?” I ask a person standing there.
“American dollars are being auctioned. These people are announcing the rates.”
“And why are these shops closed?”
“The FIA sealed them many months ago for involvement in hundi, hawala and the smuggling of dollars,” I am told.
“So why do people gather here and trade dollars in this way?”
“They come here for a short time and disperse if there is any risk.”
On our way back, I try to contact Abdullah Sarraf, president of the money changers association. His phone is off. A local trader tells me he is busy because the FIA is raiding money changers’ offices and shops.
“The illegal trade of American dollars and hawala andhundi is taking place everywhere in the province,” says a senior official of the FIA who is involved in action against the activity. “There are hundreds of illegal money changers here, and only 83 are legal. We have sealed over 200 shops, arrested around 150 illegal traders and registered 126 cases. But still the smuggling of American dollars continues.”
According to the FIA official, the legal trade of American dollars in Peshawar’s currency market is almost $40,000 a day.
“However, the illegal trade — which includes smuggling, hawala and hundi — is approximately $4 million a day.”
Published in Dawn, December 20th, 2015
