An Oman-based hawala network used WhatsApp, mobile-linked transfers and e-wallets to facilitate suspected unlicensed cross-border remittances to Pakistan, highlighting how traditional underground banking networks are adapting to digital financial tools.
The case was detailed in a new report by the Financial Action Task Force (FATF) on professional money laundering, underground banking and hawala networks. Dawn reported the case after the report was published on September 3.
Table of Contents
Key Takeaways
- Countries involved: Oman and Pakistan
- Network: Suspected unlicensed hawala/remittance operation
- Main communication channel: WhatsApp
- Payment methods: Cash, mobile-linked transfers and e-wallets
- Target customers: Expatriate communities in Oman
- Group identified: “XX Money Exchange”
- Transaction flows identified: Approximately $72,293 over one year
- Pakistan-side channels: Included lower-cost digital payment options such as Raast
- Authorities involved: Central Bank of Oman and other relevant authorities
- FATF report: Published September 3, 2026
How the Oman-Pakistan Hawala Network Operated
According to the FATF case study, Omani authorities received intelligence through a whistleblower channel concerning individuals suspected of operating an unlicensed cross-border remittance business targeting Pakistan.
The Central Bank of Oman became aware of unusual activity after detecting a decline in customer remittances through certain corridors. Authorities subsequently conducted enquiries, engaged with customers and monitored relevant online activity.
Investigators identified a WhatsApp group called “XX Money Exchange”, which was reportedly operated by foreign nationals to advertise foreign-exchange and remittance services to expatriates living in Oman.
WhatsApp Used to Recruit and Coordinate Customers
The operators reportedly promoted exchange and remittance services through WhatsApp.
Their offers were attractive because they provided exchange rates below formal market rates while charging minimal or no fees. Customers were also encouraged to share the WhatsApp group with other people who wanted to send money.
This illustrates how messaging platforms can allow informal financial networks to reach customers quickly without relying on traditional physical branches or advertising channels.
Cash and Mobile Transfers Were Used
Customers reportedly transferred money to the suspected hawaladars either in cash or through mobile-linked transfers.
After receiving the funds, the operators provided screenshots showing proof of payment through an e-wallet to a corresponding e-wallet maintained with a payment service provider in the destination jurisdiction.
The arrangement effectively connected an informal money-transfer network with digital payment infrastructure.
Raast and Other Digital Payment Channels
The FATF case study said the scheme exploited lower-cost remittance channels in destination countries, including fee-free transfers to Pakistan through channels such as Raast, alongside exchange-rate differences offered by some digital wallet and payment providers.
These differences allowed the operators to generate margins while still offering customers cheaper remittance services than conventional channels.
The case therefore demonstrates that digital payment systems can be incorporated into informal transfer arrangements even when the overall remittance operation itself is outside the regulated framework.
Omani Authorities Identified Six Suspected Hawaladars
According to reporting on the FATF case, Omani authorities identified six suspected individuals believed to be part of a connected hawala network.
Transaction flows of approximately $72,293 were recorded over a one-year period.
The case was one of several examples used by FATF to demonstrate how underground banking and hawala networks can operate across borders and increasingly interact with formal financial technology.
FATF Warns of the Rise of Digital Hawala
The Oman case forms part of a much broader trend identified by FATF.
The organisation’s new report found that more than 80% of reporting jurisdictions identified underground banking and hawala or similar service providers as among the principal channels or techniques used for professional money laundering.
FATF also highlighted the emergence of “digital hawala.”
Nearly 70% of respondents identified the integration of new technologies and a growing shift toward digital hawala. These networks can use encrypted messaging applications such as WhatsApp, Telegram and Signal, while customers may initiate transfers through bank accounts, mobile wallets, fintech applications and instant-payment systems.
The report also identified the use of virtual assets, including stablecoins, AI-based tools and even purpose-built hawala applications.
Why Digital Hawala Is Difficult to Detect
Digital tools can make underground financial networks faster and more geographically flexible.
Instead of relying entirely on physical cash and face-to-face transactions, operators can coordinate customers through messaging applications, receive funds through digital wallets and use payment providers to settle transactions across borders.
FATF warned that this integration with the formal financial sector can create regulatory blind spots, particularly when bank accounts, fintech platforms, payment service providers, virtual IBANs, prepaid cards or virtual asset wallets are used as entry and exit points.
Hawala Is Not Always Illegal
The FATF report makes an important distinction: hawala and other similar service providers can have legitimate uses for remittances and value transfers.
However, unregistered or unlicensed operations can create significant risks and may violate national laws. FATF recommends that countries ensure relevant service providers are licensed or registered and subject to appropriate oversight.
Therefore, the Oman case concerns a suspected unlicensed remittance operation, rather than establishing that every hawala transaction is illegal.
Implications for Pakistan’s Remittance System
Pakistan receives substantial remittance flows from overseas workers, making efficient and regulated transfer channels particularly important.
The Oman case highlights how customers may be attracted to informal operators by lower fees and more favourable exchange rates. At the same time, such arrangements can make it more difficult for authorities and financial institutions to trace the origin, destination and purpose of funds.
The FATF findings reinforce the need for effective monitoring of digital payments, stronger cooperation between financial institutions and regulators, and greater international information sharing.
Why This Matters
The Oman-Pakistan case shows that underground banking is no longer limited to cash-based networks.
Messaging applications, mobile wallets, fintech platforms and instant-payment systems are increasingly becoming part of the infrastructure used to coordinate and settle informal cross-border transfers.
For regulators, the challenge is therefore not simply identifying traditional hawaladars. It is also understanding how informal networks interact with legitimate digital financial services.
FATF’s latest report argues that stronger detection capabilities, public-private information sharing, international cooperation and proportionate financial inclusion measures are needed to disrupt professional money-laundering networks without unnecessarily restricting legitimate financial services.
FAQs
What happened in the Oman-Pakistan hawala case?
Omani authorities investigated individuals suspected of operating an unlicensed cross-border remittance business to Pakistan. The network reportedly used WhatsApp, cash, mobile-linked transfers and e-wallets.
How did the network find customers?
The suspected operators used a WhatsApp group called “XX Money Exchange” to advertise foreign-exchange and remittance services to expatriate communities in Oman.
How much money moved through the network?
Omani authorities identified transaction flows of approximately $72,293 over one year involving the suspected network.
Did the network use Raast?
According to the FATF case as reported by Dawn, lower-cost destination-country channels included fee-free transfers to Pakistan through systems such as Raast.
What does FATF mean by digital hawala?
Digital hawala refers to the growing use of digital technologies by underground money-transfer networks, including encrypted messaging applications, mobile wallets, fintech platforms, instant-payment systems and, in some cases, virtual assets.
Is all hawala illegal?
No. FATF notes that hawala and similar service providers can serve legitimate remittance and value-transfer needs. However, unlicensed or unregistered operations can be illegal and create money-laundering and terrorist-financing risks.
When was the FATF report published?
FATF published its report, “Investigating Professional Money Laundering, Underground Banking, and the Use of Hawala and Other Similar Service Providers,” on September 3, 2026.
