From The Bench: Sunrise Equities and Obama

Just a few miles south of where I live is a thriving Pakistani and Indo-American community centered around Devon Avenue on Chicago's North Side. Dozens of family owned businesses rake in lots of cash--Mrs. Marathon Pundit bought some things on Devon--and some of that money ended up in the hands of Sunrise Equities CEO Salman Ibrahim.

AP explains:

Between the prayers that fill the holy month of Ramadan, during the long fasts that stretch from dawn to dusk, Muslims have been meeting to discuss the disappearance of Salman Ibrahim.

The respected businessman persuaded up to 200 Pakistani and Indian immigrants to contribute their savings and mortgage their homes to finance real estate deals.

But Ibrahim vanished in August, leaving his investors with losses that could total $50 million — in some cases their life's savings.

"The scale of impact that this stands to have on a lot of people in the South Asian and Muslim communities is potentially very drastic," said attorney Salman Azam, who filed a petition last week to force Ibrahim's company, Sunrise Equities Inc., into bankruptcy. "There are a lot of very, very sad stories and dire financial situations."

Here's how Sunrise explains itself:

Sunrise Equities Inc., incorporated in Chicago in 2001, is a Shariah Compliant financial services firm dedicated to providing the market with competent and innovative Shariah Compliant investment products and services. Sunrise caters on a global basis to institutions and high net worth individuals who wish to benefit from outstanding performance even as they maintain a Shariah Compliant approach in their investments.

Okay, what does this have to do with Barack Obama? My friend Tom Mannis of The Bench, in a great piece of original reporting, explains:

Barack Obama has long had strong ties to Muslims and to Pakistanis. He also has long and strong ties to Sunrise Equities and Salman Ibrahim.

(In 2004) Obama wanted a satellite fundraising office in the "Devon Corridor," the largely Indian-Pakistani section of Chicago's West Ridge neighborhood on the north side. Salman Ibrahim was happy to help. Free office space was given to Obama's campaign within Sunrise's general offices at 6355 N. Claremont. Obama has long wooed Muslim voters, and did not have a physical presence in this part of Chicago, so the Sunrise location made logistical sense for Obama. It also made sense for Ibrahim and Sunrise as an effort to curry favor with rising star Barack Obama.

In 2004, Sunrise Investments gave Barack Obama free office space during his run for US Senate. The Bench has photographs of the ribbon-cutting ceremony. Clearly seen in the photos is Barack Obama and Salman Ibrahim.

But this is just part one of Tom's report. What's next? Part Two - Obama's Connections to Salman Ibrahim and Sunrise Equities.

Oh, if someone can explain how Shariah financing functions, please enlighten me. But I'm going to have a stab at it. As far as I can gather, with Shariah financing, a borrower buying a house gets title to the property right away (Huh?), sends the lender monthly payments, but so the borrower doesn't tell the borrower "Shove off, the house is mine now" after the title is handed over, the borrower first transfers to the lender assets worth the same as the house as collateral.

According to regular Marathon Pundit commenter "Yo," the "interest" is figured into the monthly payments, but is not called that.

But what if the collateral is assessed wrong or fraudulently? (This is what happened in the 1980s savings and loans scandals.)

What if the collateral plummets in value but the worth of the house doesn't?

And most importantly--how on Earth can anyone, Muslim or not, move ahead operating under such a financial system. How do you acquire the collateral in the first place?

Economic growth is stunted, if not stopped, under such conditions.

Related post:

Sunset on Sunrise Equities--an overlooked story

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