[casi] AMEX (& others ) discriminating against Muslims/Arabs?

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http://www.citylimits.org/content/articles/articleView.cfm?articlenumber=988

City Limits MONTHLY
Date: <A HREF="http://www.citylimits.org/content/articles/articleContents.cfm?issuenumber=84">May 
2003</A>

LEAVE HOME WITHOUT IT
Credit card companies cancel on Muslim New Yorkers. > By Hilary Russ

  
Say that you are one of those fortunate people who manage to pay off most of
their credit cards every month. Then imagine your surprise when one of your
cards is cancelled for no apparent reason. You'd be outraged, especially if
you found out this was only happening to you and your friends.That's exactly
what Farooq Firdous experienced. Last summer, Firdous, a Pakistani who got
his green card in 1997 after 11 years of legal residence in the U.S.,
received a phone call from an American Express representative regarding a
credit card he held. The rep requested that he send the company a mountain of
paperwork: three years of tax returns, six months of bank statements and a
job verification letter.

His wife, Yasmin Khan, who is Indian, received a separate phone call that
same day for her own AmEx credit card. In each case, the rep told them they
had 15 days to submit the paperwork or their cards would be cancelled.
Firdous and Khan called back later--twice--to ask reps if they could send the
request in writing. They refused.

Firdous and Khan were confused, to say the least, because they always paid
off their AmEx cards on time. After conferring with his wife, Firdous called
the company back again. "I told them strictly, 'You're probably
discriminating against minorities with Muslim names,'" he recalls. He and his
wife refused to submit the documentation, which on at least three different
occasions company reps said they needed for "security reasons."

A few weeks later, each received a letter saying his or her credit card was
cancelled: "You did not provide the banking information, financial
statements, income tax return, and/or identification documents requested."
The letters also stated that the reasons for cancelling the account included
"information received from a consumer reporting agency," hinting that credit
problems might be to blame.

But Firdous' credit is excellent, according to the credit report he
subsequently obtained. (Indeed, after his AmEx card was cancelled, he
immediately applied for and received a Citibank Mastercard.) The status of
his closed AmEx account reads "Paid/Never late."


_______

The government's post-9/11 infringements on civil liberties have been well
documented and debated. But what happens when private companies take the
fight against terrorism into their own hands? If you're Pakistani, or Muslim,
or both, you might just find your credit cards cancelled, despite the good
credit you've worked hard to build.

City Limits has found 12 cases in which Muslims, nearly all
Pakistani-Americans, with good credit, all of whom claim they made no unusual
or exorbitant charges or late payments, had their American Express credit
cards cancelled. We found no cases of non-Muslims' credit cards being
cancelled outright, or even non-Muslims who were asked to send in paperwork
for existing accounts.

For Pakistanis in particular, losing access to financial services is neither
simply the misfortune of discrimination, nor minor fallout from the U.S. war
on terrorism. All over New York City, Pakistanis are proprietors of small
businesses: medical practices, bodegas, restaurants and, in Firdous' case, a
computer store in Sheepshead Bay. For them, maintaining access to credit and
other financial services is a matter of survival.

So Firdous was alarmed when he soon began hearing more stories like his. He
had considered the AmEx matter a freak event--until he brought it up at a
dinner party a couple of months later on Long Island. That's when he and his
wife realized they weren't alone.

Two other guests at the table, Dr. Iqbal Siddiqui and his wife, Dr. Faizah
Zuberi, who live in a stately home in New Jersey, had gone through almost
exactly the same baffling series of events: Same request, same documents,
same cancellation. And the same, immediate suspicion of discrimination. "They
asked for too much stuff. I said, 'Why are you asking all this? We have very
good credit. There's no need to do this,'" says Siddiqui. "We are sympathetic
Americans; we like America. They gave me bullshit on the phone." Siddiqui and
Zuberi recall reps telling them that they had been selected at random. The
couple had used their AmEx almost exclusively to buy groceries at the local
Costco.

After the dinner party, Firdous conducted his own informal survey. He
discovered that American Express reps had contacted at least five more of his
friends and acquaintances, requesting information for their existing American
Express accounts. All of the friends' cards were then cancelled, whether they
sent in the paperwork or not. All are Muslim, while none of his Jewish or
Chinese friends, he says, have received the dreaded call. "He was pretty
angry about it," recalls one American-born Chinese friend who did not want to
be named.

Zuberi noticed the same trend, and even asked the AmEx representative, "'How
come I ask a lot of family members and friends and they say it all happened
to them, but when I ask my American colleagues it hasn't happened to them?'"
she recalls. "They say, 'We have a lot of Joneses and Smiths on the list,
too.'" Zuberi wasn't convinced.

American Express Vice President of Public Relations Tony Mitchell claims that
company policy prohibits him from going into detail on Firdous' or Khan's
specific cases, even though City Limits obtained their permission to do so.
"We routinely monitor all of our card accounts," Mitchell says. "As part of
that, we may ask a card member for additional financial information to gain a
fuller picture of the account and to assess the current credit and financial
condition of the cardholder."


_______

Financial institutions have always had to be diligent about checking
customers' identities. After September 11, notes American Bankers Association
spokesperson John Hall, the federal government has increasingly scrutinized
all financial institutions, especially their ability to identify customers.
"There's a need to go beyond just checking ID and actually verify who they
are," says Hall.

The banking industry has been actively assisting the government in post-9/11
efforts to find and block money directed to terrorists, using the same tools
they've employed for years in the war on drugs. Financial institutions work
with the Financial Crimes Enforcement Network, or FinCEN, part of the
Department of Treasury. Companies and banks check names against the
80-page-long list of names maintained by OFAC, the Treasury's Office of
Foreign Assets Control. It includes approximately 5,000 "Specially Designated
Nationals and Blocked Persons"--people and organizations with whom Americans
are not supposed to do business, including terrorists, narcotics traffickers
and money-launderers. Banks have used this list for about a decade, but
"September 11 served as a stark reminder to everyone involved that they
should really be rigorous in looking at these names," says OFAC spokesperson
Tony Fratto.

When new names are added, financial institutions check them against their own
customer lists. The repercussions of noncompliance with reporting
requirements are very serious: Institutions can be held liable if they even
inadvertently do business with one of the Treasury Department's banned
customers--up to $10 million in fines and 30 years in prison.

None of the full names of people mentioned in this story appear on OFAC's
master list. But other lists of alleged terrorism supporters are now
proliferating. Just after September 11, the FBI drew up a list of names of
people it wanted to question, giving the dossier out to private businesses,
such as hotels and airlines, here and abroad, as a new experiment in
information-sharing called Project Lookout.

But the FBI soon lost control of the Project Lookout list, and bootleg copies
with added names and even typos were passed around the private sector. As
many as 50 different versions may now exist. "This thing took on a life of
its own," says FBI spokesperson Bill Carter, who says that from the very
beginning, companies may have misinterpreted it as a list of people not to do
business with. "It's a defunct list that shouldn't be used for that purpose."

And it's not the only one. Among the other watchlists businesses or local
governments can refer to (and which sometimes overlap) are the "Denied
Persons List" and an "Entities List," both issued by the Commerce Department.
The "Debarred Parties" list comes from the Office of Defense Trade Controls
in the State Department. There's a "World Bank Debarred Parties" list, a
"Blocked Officials File," a "Bank Secrecy Act," the FBI's "Violent Gang and
Terrorist List," and, of course, the USA PATRIOT Act's "Terrorist Exclusion
List."

Joshua Salaam of the civil rights department of the Council for
American-Islamic Relations, a Washington, D.C.-based nonprofit that conducts
public education and advocacy about Islam, says the lists "are powerful,
infiltrating Muslims' daily lives, affecting them more than they know and
more than the general public knows."

A Brooklyn man named Muhammad found that out for himself when he tried to
wire $80 to Connecticut via Western Union. His transaction at the Western
Union office completed--or so he thought--Muhammad went home, only to later
receive a call from the company requesting that he come back in to show photo
ID and reveal his country of birth. If he didn't, the rep informed him,
Western Union would neither send nor release his $80. Muhammad's full name,
it turns out, is on the OFAC list.

Among Muslims, the likelihood that many people will have the same or very
similar names is huge. "Muhammad is the most common name in the world," says
Susan Attar of the Muslim Public Affairs Council. "The majority of Muslims
probably have at least one person in their family with that name." That's a
lot of Muhammads: There are upwards of 4 million Muslims in the U.S.

Lists aren't the only measures making financial institutions exceedingly
cautious about whom they do business with. The PATRIOT Act, which stipulates
strict new reporting requirements on currency transfers and suspicious
financial activities, is now prompting further vigilance. Western Union has
already been fined for violating the reporting rules, paying $3 million in
March 2003 (without admitting any wrongdoing).

"There are all kinds of things going on here," says Kevin Jackson, assistant
professor of business ethics at Fordham University and a scholar of corporate
liability. "Corporations are trying to protect themselves, and then either
acting appropriately or inappropriately to deal with enhanced liability." The
question for financial institutions and private companies then becomes how to
fight corruption, credit card fraud and money laundering without inculpating
innocent consumers and violating procedural norms.

"It's a delicate balancing act," says the Bankers Association's Hall, noting
that law enforcement agencies must subpoena a bank to receive client records.
"We want to do our part in the war on terrorism, but at the same time we need
to protect our customers' privacy. That's the bottom line."


_______

After getting hit by punitive credit card cancellations, the owners of small
businesses are wondering what's left for them in the city they have called
home for decades.

The bright red profile of New Kantacky Halal Fried Chicken anchors its corner
of Coney Island Avenue, which cuts an industrialized swath through a
neighborhood of charming two-story homes. Kantacky co-owner Ahsin Choudhry, a
gold chain tucked into his elegant cream-colored Izod sweater, has had no
credit problems, yet he's received more than his fair share of credit card
cancellations.

Last year, he says, American Express closed his personal account right after
he paid it off; he didn't even get the initial request for documents that
other cardholders received. For a new business account he had recently
opened, an AmEx rep called and asked him to send in W-2 forms. He told the
rep that since they had already cancelled his personal account outright, he
didn't want to bother sending in paperwork for the business card they had
issued to him. He activated the business card, and within an hour, he says,
it was void.

For Choudhry, it wasn't just AmEx. In order to get his business up and
running two and a half years ago, he charged about $10,000 worth of kitchen
equipment on his Discover card. His wife, Zubaida Choudhry, charged $15,000
on her own Discover card for the business and home mortgages. After both the
accounts were paid in full last year, Discover representatives called and
asked the Choudhrys for tax returns for both accounts for "security
purposes," he says. They sent them in. Their cards were summarily cancelled
anyway. "We never missed a payment or anything," he says calmly but with
obvious frustration.

Just down the block, the owner of a Halal bodega, who didn't want to be
named, was contacted by American Express for his merchant's account. Last
spring, a representative called to request that he send in tax returns and
three months of bank statements. He couldn't find his tax returns, so he just
sent in the bank statements. His account was closed, and now he can no longer
take American Express cards from customers. He claims that the representative
told him that because customers who charged items at his store with their
AmEx cards were not paying off the charges, the company had to cancel his
merchant's account. An AmEx rep then requested that he send in paperwork for
his personal account also; since they had nixed his merchant's account, he
didn't want to bother, figuring they would do whatever they wanted
regardless. So they cancelled his personal card, too. "It's like they put
duct tape over his mouth, plastic on his face," says his best friend, also
Pakistani, who didn't want to be named either. "It's a shame really. Who's
gonna listen?"

Still more Pakistani businesses have been targeted. Hani Khoury, a lawyer and
vice-president of the Arab-American Anti-Discrimination Committee of New
Jersey, mentions the money-wiring business belonging to one of his clients.
The man, he says, has always been licensed, kept detailed records, played by
the book and even gave customer information to the FBI. Yet late last year,
Citibank and the Bank of New York called and told him they were dropping his
accounts with them--claiming, according to Khoury, that they were entitled to
close accounts at any time without having to offer any explanation. "He was
considering hiring a blond, blue-eyed American woman to deflect suspicion,"
says Khoury. (The Bank of New York has since reopened his account.)

For Pakistanis without green cards, the Bureau of Citizenship and Immigration
Services' new special registration program has provided one more opportunity
for prying into financial records. Sin Yen Ling, staff attorney at the Asian
American Legal Defense and Education Fund, reports that during the
government's special registration interviews, immigrants are repeatedly asked
for detailed information about their credit cards. It's "as if being South
Asian and Muslim and using a credit card is a huge crime," she says.


_______

A slow but steady stream of customers flows into the computer store that
Farooq Firdous co-owns. A trio of young kids with dreadlocks and knit caps
wait for their father to finish his transaction with Firdous. The shop's fake
pine-paneled walls are bare of decoration but plastered with cables, cords,
software, games, printers, headphones, and other computer bits and parts.

Business here was good until 2000, when the stock market sagged, say Firdous
and his business partner. They haven't escaped the post-9/11 economic
sinkhole, either. But in Muslim communities, tough economic times are
exacerbated by pervasive fear.

First there were hate crimes: the 481 reported incidents in the U.S. in 2001
against Muslims included 3 murders and 35 arsons. Ordinary Muslim-Americans
were subjected to shouts of "Terrorists, go home!" in random encounters on
the street, which happened to Khan and her 4-year-old son.

Since then, government intrusion into nearly every facet of Pakistanis' lives
has created a sense of vulnerability that has slowly soaked through entire
communities. Now there's a fear of deportation, even for green card holders
like Firdous.

The FBI has visited Firdous' business three times and his home twice. They
marched into the store, looked around and then left. He says he was afraid to
ask why they were there. "When you ask one question, you don't know what will
happen," he says. "I stayed quiet." At home, an agent first showed Khan a
photo, and asked her if she knew the man in it. On the second occasion, the
FBI asked her name and left.

"In these neighborhoods, there's a lot of surveillance and movement of law
enforcement agencies, which has created a lot of harassment and
intimidation," says Ahsanullah "Bobby" Khan, founder of the interfaith Coney
Island Avenue Project, which he set up right after September 11 to provide
legal, financial and educational assistance to Muslims. "Those neighborhoods
are marked," he says. "Now they don't think that this is the place for them
to live, and they're leaving voluntarily."

Thousands of Pakistanis, most but not all undocumented, have tried to flee to
Canada. From this January to March 15, more than 1,600 applied for refugee
status after crossing the Canadian border. Many others are returning to
Pakistan.

Coney Island Avenue's moniker, "Little Pakistan," may not ring true for much
longer. Proprietors of Pakistani establishments are moving out of Brooklyn,
waiting only to see if they can get a good price for their business, and
restaurateurs have never before seen so few customers. "Brooklyn in Midwood,
if you go to Brighton Beach and downtown Brooklyn, if you go in Queens,
Jackson Heights, Astoria, Steinway Street," says Bobby Khan, "all these
shopping areas were relying on these immigrants."

Their absence in public life is obvious. On religious holidays, Firdous and
his partner go to a Brighton Beach mosque, a building that was donated years
ago by the father of Firdous' partner. The place is usually packed. But
during Eid ul-Adha this February, it was practically empty. "Everyone is
leaving," sighs Firdous.

Firdous and Khan often discuss what they would do if they and their kids were
forced to leave, even though that's an unlikely scenario. "We discuss
contingency plans," he says. "She's Indian; I'm from Pakistan. Our position
is very difficult. She doesn't want to go to Pakistan, and I don't want to go
to India." Their children only speak English. "We're very confused," he
repeats three times. "They can come and take me away anytime. What will my
family do?"

As Firdous talks about the case, he absentmindedly taps a neon orange pen,
which blinks red every time it hits the desk. In his methodical manner of
speech, which is almost a drawl, he says, "A lot of people are scared to come
forward. They said 'Forget it,' like I did."


The lists, says Joshua Salaam, "are powerful, infiltrating Muslims' daily
lives, affecting them more than they know and more than the general public
knows."









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