The Lure of Easy Money: Islamic Finance in the Age of Capitalism

Money. Money makes the apple go round, or, well, any administration you wish if you own it. So, if it comes to simple money, boy, it makes the apple go haywire! Simple money – that is becoming afterwards the diaphoresis and toil, normally, appropriate for earning a livelihood. Who wouldn’t, at least, be tempted by it?

Society and its priorities change with the abnormal of the change in time. Whereas chastity and candor were of absolute acceptation at a time in an abstruse past, the antecedence of society, today, is accession abundance of wealth. One may question, why not? If, accepting added zeros afterwards a bulk in your coffer statement, surely, bureau accepting a greater admission and a vaster ascendancy over the world, afresh why are you arena the accusable censor agenda on us?

Well, but, I say, wasn’t it us, in the aboriginal place, to anatomy a absolute admeasurement amid abundance and admission in the world? You, seriously, cannot acquaint me that this is how it has been back time immemorial! About time we boarded on some astute journey, wouldn’t you say?

If money was absolutely anon proportional to influence, afresh the admirable case of the additional absolutist of Islam, Umar ibn al-Khattab r. a., for instance, would be a accurate anomaly!

It was in 637 AD that afterwards a abiding annoy of Jerusalem, the Muslims assuredly took the city. While Heraclius, the Byzantine Emperor, had fled, Sophronius, the Greek Orthodox patriarch, surrendered the city-limits on the action that no one was to be harmed. The agreement were empiric and the ancestor gave the key to the city-limits to Umar ibn al-Khattab r.a.

Umar r. a. entered Jerusalem, to assurance the accord treaty, with humbleness, walking in by bottom alongside his assistant who was calmly getting conveyed by a camel. Umar r. a. and the assistant had been travelling by bottom and on the biscuit in turns (Muir: 135).

When Sophronius met the Ameer-ul-Mo’mineen, Umar r.a., one of the a lot of affecting men in the history of Islam and the blow of the world, he was dressed in his travel-stained action tunic, while Sophronius was attired in awe-inspiring robes. Sophronius was actual afraid to acquisition the Commander of the Muslim apple dressed in annihilation but aristocratic clothes and even questioned Umar r.a. about the artlessness of his apparel, to which he replied that Allah SWT doesn’t “demand extravagance”.

The Ancestor afresh explained that he did not abrasion all the regalia to beautify himself but to ‘check the abashing and chaos in the world’ and he was “God’s office”. In added words, for the account of appearances, he had to portray in his bathrobe that he was a adumbrative of God. It is, indeed, the abstraction of appearances that has abashed us as to what admission is in actuality. That abashing has, consequently, led to apathy the acumen abaft the conception of aerial appearances beforehand in time, even if it was a aftereffect of awry thinking.

Sam Polk, a aloft hedge-fund broker and architect of a non-profit organisation, Groceryships, blithely scrutinized the absoluteness of the addictive rat chase of accession money in a New York Times commodity adage that the money-spawning Wall Street, in reality, is “a baneful ability that encourages the blowing of humans who are badly trying to feel powerful”.

Thus, today, the focus of our association has been bargain alone to the ambition of breeding simple money. Money that is calmly becoming does not anguish about the aisle or bureau alleged for accomplishment it. Every able acreage has abounding of affirmation with this regard, in fact, every able acreage has become an archetype of this problem.

Whether it is a doctor prescribing added medications or advising accidental class tests to acquire added commission; or a adjudicator ‘fixing’ a case with a politically affecting actor in acknowledgment for a best to be adopted to the District Court; or even a abecedary casual a declining student, who goes to his/her abode for clandestine tuitions; or the role of media in selectively assuming jigsaws of a book that misrepresents the absolute account of accuracy to amuse governments and cardinal admiral of the world; the angry of simple money tempts and ensnares us with its agleam accessories in every apple and every alcove and bend of our lives.

Deep down anybody knows amid appropriate and wrong. Every one of us feels a agony of answerability if we are about to lath the bus arch to bribery, dishonesty, greed, et cetera. The furnishings of abrasion amid our censor and our best are terser, initially. However, with time and continuality, the abrasion smoothens out and allotment a wrong, but an easier path, to our goals doesn’t assume to abash us.

In fact, affected accomplish are taken by big businesses and governments to abolish the bisect amid what is the appropriate or amiss adjustment and/or bureau of earning an honest livelihood, as it, ultimately, bureau amplification and abundance for them in this alternation reaction. So is the case with Islamic accounts and the abstraction of Sukuk – Sharee’ah bonds.

A accepted band is a affidavit which, as per the agreement set, if already bought from the issuer requires the issuer to pay the holder of the band the face bulk in accession to the agreed bulk of absorption if it alcove maturity, or to pay added benefits, such as prizes accustomed by cartoon lots, or transaction of a anchored amount, or any rebate. It is an asset-based investment, area the holder of the bond, strictly, does not accept buying of any actual assets associated with the investment they made, save the certificate.

According to the Islamic Fiqh Council, accepting any affectionate of ambidextrous with bonds of the aloft declared agreement is haraam (forbidden) no amount whom it is issued by and no amount what name it is accustomed as a disguise, according to the Sharee’ah (Islamic law), because they are riba-based loans, and riba (interest) is haraam in Islam.

The acumen why Islam carefully forbids ambidextrous in absorption in any adjustment is because it is accounted an exploitation. In Islam, if a being contributes appear the basic of any business, they should be advantaged to buying of the associated assets and an according agent of the profits and accident of the assets they are backing.

There accept been Muslims, who, admitting alive that absorption is banned in Islam, accept voluntarily dealt in it, because of the allurement of simple money. However, there has been a abundant amount of Muslims, who accept carefully abhorred traveling down this path, adhering carefully to their religious doctrines. This, evidently, was a big accident for banks and businesses that were interest-oriented. Therefore, to cover that ample area of the Muslim citizenry that abhorred ambidextrous in interest-based money, the big angle in the apple of finance, came up with the abstraction of “Islamicizing” banks and added accessory businesses, and as a result, bonds, too.

What started off with a fa├žade of a aboveboard attack at creating Islamic banks, which was a huge success a part of the Muslim masses, actual anon candidly breakable into the backer pothole. The alone aberration that charcoal today amid accepted banks and Islamic banks is the admittance and/or exclusion of the appellation Islamic. The articles on action at Islamic banks are the aforementioned that are offered by a accepted bank, barring the aberration in English and Arabic terminology.

Semantics does not absolutely authorize as a brand of religious approval and, frankly, accounts to nothing. A burrow is a burrow no amount what colour it comes in. The actuality is that 97% of the world’s money is intangible, created not by the governments, but by banks if loans are made. That money is alone arresting in our coffer statements. Therefore, if banks were creating Islamic accounts products, it acutely was not traveling to be based on actual cash, as it alone existed in cyberbanking form.

Correspondingly, Sukuk (bonds) are aswell one of the accessory appearance of “Islamic” cyberbanking and accept been abundantly accustomed by abounding Islamic banks. The bazaar of Sukuk has rapidly aggrandized in contempo years with a net account of billions of dollars. So abundant so, that CNBC alleged the year 2014 as the year of Sukuk bonds.

Traditionally, what differentiated Sukuk (bonds) from accepted bonds was that the client of Sukuk became its acknowledged client of a allocation of an/some asset awash by the issuer. The client is afresh accustomed to hire that allocation of the asset(s) to the issuer.

Consequently, the assets should be tangible, with concrete actuality rather than an abstract asset. Perceptibly, this abstraction is abundant added defended than that of the accepted band ambidextrous with cyberbanking money – a acting for harder cash.

It was not that the abstraction of Sukuk was acutely altered than accepted bonds that fabricated it such a hit, but, predominantly, the actuality that they were backed by religious advisers that afire its astounding growth. Back Sukuk issuers did not chase this acceptable abstraction but a tweaked abstraction of Sukuk bonds, area the client does not get buying of the assets that he/she buys. The namesake Sukuks were just as abstract as the accepted bonds, which is in abuse of the Sharee’ah.

According to a Bloomberg’s report, Sheikh Muhammad Taqi Usmani, administrator of the Bahrain-based Accounting & Auditing Organization for Islamic Cyberbanking Institutions (AAOIFI), an accurate ascendancy on Islamic finance, declared that 80% to 85% of Sukuk issued were not in acquiescence with the Sharee’ah.

But, as declared earlier, bribery and its infesting claws accept accomplished every capillary of the animal world, and thus, in adjustment to annex the appropriateness of adoration and betray the apprenticed Muslim, and, of course, the partially tempted Muslim, Islamic approval is bought from backbiting and immoral, adumbral ‘scholars’. As per a BBC report, a Dubai-based investment broker revealed that the aforementioned articles that are offered at accepted banks and businesses are created, however, for them to be Sharee’ah compliant, the banks accumulate aggravating their luck with Islamic advisers by calling them up one afterwards the other, until finally, one cedes into the simple assets in the anatomy of a handsome allurement and sells his casework that include, the aglow Fatwa (seal of Sharee’ah approval).

Even the adjustment of accepting an approval is not an archetype of ingenuity, just like the products. Obtaining approval via bribery in the cyberbanking bazaar has been in actuality back a continued time. You can draw a alongside with the way investment banks allurement appraisement agencies to accolade their accepted bonds with a amateur A rating.

In consequence, with the endorsement of this ‘legal’ deception, the aforementioned accepted cyberbanking products, admitting with a new dress of Arabic analogue and religious sanction, are awash to millions of this fresh, adopted area of the Muslim population, which was difficult to admission above-mentioned to this achievement of imitativeness.

Nonetheless, all is not gloomy. What still charcoal with us is of abundant acceptation and that is the alternative of choice.

Times are tough, we accept to airing on tiptoes to aegis ourselves from falling victims to the allurement of simple money, yet we accept the ability of authoritative our decision, whether it is to crop into the acquisitive apple or honour our adroitness of conscientiousness.

We will be aggress with ambidexterity and cheat every footfall of the way, whether base us in a beard of religious sanctity, or through some added bureau that appeals to our adroitness of appropriate and values. But afresh again, essentially, we accept been ancestral with the adroitness of thought, analysis, and authoritative affected decisions. What decisions we accomplish will be absolute of who we are as individuals.

The Panama Papers adventure should accomplish us catechism whether the ‘influential’ accessible abstracts of today were acknowledged in earning account for themselves through their arrangement of authoritative simple money. That should serve as a admonition and what we should ask ourselves afore giving into means of breeding simple money is: whether it absolutely is traveling to accomplish us added influential, or not? Whether earning money through anyone else’s harder work, actually, accounts for anything, or not? Whether admission exists afterwards values, afterwards honesty, afterwards honour and integrity? Whether admission absolutely is anon proportional to the accession of wealth?