An agent, broker or courier in an hawala system;
like a
good bookie, an hawaladar keeps the numbers and transaction 'nodes' all in his/her head, all through an honor system, something Westerners can't seem to do. They may appear to be in the import-export or translator business.
How Hawala works, as
best understood in the
West:
1. A customer approaches a hawala broker X hawaladarin
one city and gives a sum of money that is to be transferred to a recipient in another, usually foreign, city. Along with the money, he usually specifies something
like a password that will lead to the money being paid out;
2. The hawala broker X calls another hawala broker M in the recipient's city, and informs M about the agreed password, or gives other execution instructions for the funds;
3. The intended recipient who also has been informed by A about the password
now approaches M and tells him the agreed password. If the password is correct, then
4. M releases the transferred sum to the end recipient, usually minus a
small commission.
5. Hawaladar X now basically owes hawaladar M the money that M had paid out to B; thus M has to trust X's promise to settle the debt at a
later date.
No promissory notes move between the hawala brokers.
