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Unethical Practice Essay

5078 words - 21 pages

What is Sharia Banking?
London is the leading Islamic banking center in the West, and the Netherlands is seeking to overtake London in this regard. Wall Street is becoming enamored with Islamic banking (also known as Sharia banking) and this banking model is rapidly gaining acceptance in the Western world.
Unlike the traditional banking model most Westerners are familiar with, Islamic banks are managed according to Sharia law. The main difference between Western banking and Islamic banking is the Quran prohibits the collection of interest in all monetary transactions, charging fees (and donations) for services provided in lieu of charging interest on loaned capital.
Islamic banks are also ...view middle of the document...

According to the Brussels Journal, these groups have openly expressed hopes of returning Islam to Europe "as a conqueror" either by preaching and ideological change or "by the sword".
Islamic banks now position themselves as the moral alternative to Western banks, and 3 in 4 Muslims in England prefer sharia-compliant banking products over their Western banking counterparts. In Europe, Islamic banking is now reaching beyond the Muslim community, seeking to become the preferred choice of non-Muslims for banking transactions, citing their products (and banking ethics) are superior to the Western banking system. In London alone, some 20% of inquiries into Islamic banking products is now coming from non-Muslims.
As Sharia banking becomes increasingly accepted as an alternative to the Western model, the opportunity to spread Islamic ideology to non-Muslims increases. According to Sheik Yousef Al Quardawi (a leading Sunni cleric, spiritual leader of the Muslim Brotherhood, and head of the fundamentalist European Council for Fatwa and Research), the introduction of Islamic banking into the West will be the vehicle through which Islam will establish a caliphate (Islamic government rule based on the Quran) throughout the world.
According to Helena Christofi of The Brussels Journal, "Replacing western institutions with a global Islamic order is, in fact, the goal of Al-Qaradawi's Muslim Brotherhood. According to its founder, Hassan Al-Bana, the Brotherhood seeks to "[reclaim] Islam's manifest destiny; an empire, founded in the seventh century, that stretched from Spain to Indonesia," and its 1982 "secret plan" exhorted its members "to channel thought, education and action in order to establish an Islamic power on the earth." The Muslim Brotherhood is a central link between Islamic banking and Islamic fundamentalism; the first Islamic bankers were members of the Muslim Brotherhood who wanted to use "the structural power of bank ownership" to advance the fundamentalist movement in the Gulf States in the 1970s.
Today, its most powerful progeny, the Kuwait Finance House, covertly finances fundamentalist groups in Kuwait and abroad."
To educate the West, the Islamic Bank USA has created a website (www.islamic-bank-usa.com) to inform non-Muslims about Sharia banking. According to their website, Sharia compliant banking products must be:
1. Interest free
2. Trade-related with a genuine need for the fund in its purest form, so it is therefore equityrelated.
3. Ethically directed.
Certain areas of finance are permitted, while others are not. For example, funds cannot be provided for liquor, pork, gambling, pornography and anything that Islamic law deems unlawful.
Most products offered through Islamic banks include a profit (mark-up) rather than charging interest on the amount at risk. Islamic banking prohibits trading in debt, so Islamic banks do not issue conventional bonds. Islamic bonds are not interest based, but returns are based on a mathematical formula that...

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