also important to note here that complying with the United States banking
regulations and satisfying the regular periodic examinations conducted by
the bank regulators is a very important and essential aspect of running a
viable bank—both RF and conventional—in the United States and most
other Western nations, as well as other nations in the world.
In our efforts to establish a viable RF banking operation in the United
States, we started by realistically listing the facts. Here is a list of what we
came up with:
&The OCC^13 ruled that the Islamic banking models of cost-plus (Mura-
baha) and lease-to-own (Ijara wa Iqtinaa) proposed by the United Bank
of Kuwait—which follows the Shari’aa-compliant model—are in fact
regular finance transactions with different names.
&Almost all Shari’aa-compliant contracts we reviewed and analyzed
were in fact similar to the regular finance contracts, but with different
names and procedures that make them look ‘‘Islamic’’ on paper. In
fact, the contracts stated implicitly that they are indeed regular finance
contracts in case they are brought to the courts of law.
&There is sensitivity associated with the mixing of religion with busi-
ness and also the stereotyping of Muslims in many Western societies.
These sensitivities intensified after the heinous attacks of September
11, 2001.While developing an RF finance model in the United States, we decided
that our goal was to find a workable solution that would abide by Shari’aa
and would not violate or attempt to change the laws of the land. We drew
on our experience in developing the Islamic marriage procedures and con-
tracts in the United States. There were many reasons for us to adopt this
strategy. The first is that we do not have the money, the human resources,
or even a standardized and universal working legal code that we could pres-
ent as a foundation. The basis of our strategy was to achieve small successes
in our endeavor to prove the viability of this new RF banking and finance
system, and not to limit our growth and success potential by trying to
achieve impractical and unrealistic goals. We started from the fact that the
United States has, as described earlier in the book, the most sophisticated
and fair banking system representing the fruits of many years of improvisa-
tion; it is rooted in the fairness of the Judeo-Christian-Islamic set of values.
In our efforts to develop RF banking and finance, we decided that we should
not start from ground zero and reinvent the wheel, but should draw on the
huge body of human experience in banking and finance, which cannot sim-
ply be ignored or thrown away, as that approach would not be fair and wise
and indeed would have been counterproductive. Our priority was to prove
RF Banking Model for the 21st Century 247