'Stop wiring money illegally'

An inspetor searches Korean bills, cards and other belongings confiscated from Nepalese hundis who were arrested by the Gyeonggi Nambu Provincial Police Agency in October 2016. / Yonhap

New IOM Seoul-Nepal policy will safeguard migrant workers from “hundi” when remitting hard-earned wages

By Ko Dong-hwan

The International Organization for Migration’s Korean arm hopes to help migrant laborers wire their hard-earned cash safely home amid the danger of theft from illegal channels.

IOM Seoul’s mission targets migrant workers from Nepal, where remittances from outside the country make up almost 30 percent of its gross domestic product and exceed all other external sources of foreign capital. But only 10 percent of the remittances have been used for savings, household property or education, according to Nepal’s Central Bureau of Statistics.

“The workers send most of their incomes to their families in Nepal,” said Miah Park, IOM Seoul’s Head of Office. It was based on her survey of 250 Nepalese migrants in Korea under the Employment Permit System (EPS) and 20,000 households in Nepal, including potential and returnee migrants. EPS is a bilateral agreement between the Korean government and 15 Asian countries for cross-border labor migration.

“But in most cases, the workers, who wish to start businesses back in their country, found that their remittances have not been saved enough by their families. Not only the workers had not prepared financial plans with their incomes, their families spent most of the money in acquiring properties or daily consumption. The workers then need to tackle another trip of hard migration labor.”

The research, “The Role of Remittances as Effective Development Finance for Sustainable Development in Nepal,” was IOM Seoul’s 2015-16 research project. It was funded by the Korea International Cooperation Agency (KOICA) and the IOM Development Fund, and co-organized by Ewha Womans University. The project result was given to KOICA and the Nepalese government in December.

The laborers’ financial stagnation owes a lot to their risky dependence on “hundi” ― Nepali-speaking business operators in Korea who illegally do money transfers to Nepal ― instead of formal channels, like banks, when remitting money. And the informal value transfer method, also known as “hawala,” poses a threat to the money, such as being used for illegal activities.

Last October, two Nepalese criminal rings were busted by the Gyeonggi Nambu Provincial Police Agency.

A Nepalese hundi, with a Chinese accomplice, smuggled into China Korean cosmetics worth 28 billion won ($23 million) he bought with money entrusted to him by Nepalese workers in Korea. The two had been dealing contraband since 2011.

Another ring of eight Nepalese hundis used Nepalese remittance money of 24 billion won through 56 bank accounts registered in fake names.

Police said at least 2,000 Nepalese in Korea handed their money to the two groups.

Dustin Kerns, Labor Migration Project Coordinator from IOM Seoul, said the Nepalese consider hundi “much more convenient than banks.”

“Over 80 percent of Nepalese in Korea use hundis,” he said. “They believe hundis are faster than banks and provide a remittance service at lower costs. Despite the risk of being robbed of the money, they seek hundis because they do not have to speak Korean and hundis have flexible accessibility ― even on weekends.”

IOM Seoul's Head of Office Miah Park

The coming safety policy between Korea and Nepal aims to shake up the systems in both countries.

Korea, as a labor-recipient country, will organize access to more convenient and low-cost formal remittance channels, online and mobile, and will establish a “proof of income” service that can help migrants get loans.

Nepal will reduce excessively high migration costs by improving the transparency of the recruitment process, provide financial literacy education to women in Nepal ― who become de facto households after their spouses leave for foreign employment ― and encourage savings and investment with remitted wages via migrant-centric financial products and services, which in turn contribute to Nepal’s national development priorities.

IOM Seoul has been monitoring migrant laborers of diverse ethnicity and helping refugees to Korea since 2015, when it officially began to provide refugee resettlement backing. Resettlement is provided by 29 developed nations, including Korea and Japan. The U.S. accepts over 80 percent of global refugees seeking resettlement.

In 2015, Seoul accepted 22 refugees, followed by 34 the next year. They were all Myanmarese from refugee camps in Thailand who passed screening by Korea’s Refugee Division of the Ministry of Justice.

Wrestling global challenges

Following the Geneva-based headquarters’ overarching Migration Governance Framework and updated Sustainable Development Goal 2015-30, IOM Seoul contributed financial and human resources support for Syrians who were forced to flee because of the civil war.

The clash between President Bashar al-Assad’s regime and rebel forces has been raging since 2011, killing over 310,000 civilians and displacing about 11 million Syrians, almost half the nation’s population.

“We regularly trained Korea’s local NGOs with capacity building as they took to helping forced migrants, including those from Syria,” Park said.

Harsh climatic conditions are among the reasons many people are forced to leave their homes, and IOM Seoul has helped people on Bangladesh’s Maheshkhali Island with Korean internet technology to protect against nature.

The solution included building LTE networks to provide a fast internet service to every corner of the island, turning the land with vulnerable infrastructure into “GiGA Island.”

“People had to leave the island that often suffered natural disasters to seek medical help and other health services,” said Park, who added the project was one of a few private company-involved initiatives IOM pushed.

“The project will provide the island’s residents with fast internet connection and access to educational, social and health services, improving their cultural productivity and beefing up resilience through climate change adaptation,” Park said.

The project began last February when IOM inked a memorandum of understanding in Barcelona with Korean mobile carrier KT and the Bangladesh government. Park will fly to the island later this month to oversee the project ― which the headquarters called “innovative.”

Participants of a charity basketball tournamaent to help Sansa Rani, an Indonesian woman who survived an abusive human trafficking, play basketball at Jamwon Han River Courts in November 2016. The event raised about $3,000 that contributed to crowd-funding for Rani on IOM's 6Degree.org. / Courtesy of IOM Seoul

After IOM established humanitarian crowd-funding portal 6Degree.org with Microsoft in June 2015, IOM Seoul also reached out to an Indonesian woman who survived human trafficking.

The story of Sansa Rani, a domestic laborer who was abused, and later rescued on the side of a road in Malaysia at age 28, featured on the portal. To support her dream of opening a bakery shop in Indonesia, IOM Seoul co-hosted a charity basketball tournament with Korea’s largest amateur expat basketball team, GOAT (Greatest of All Time), last November. Some 90 participants raised about $3,000 through the hoops at Jamwon Han River Courts.

“Human trafficking abounds in Korea as well, where sex traffickers bring many Filipino women and exploit them to provide sexual services at bars or parlors,” said Park, who added the victims were lured by the traffickers’ lies that they could work in Korea’s show business industry with E6 visas and who even held auditions.

Whether the migrants were tricked into the trap or willing to work as a sex worker, it presents a systematic loophole in Korea’s working environment for migrants that their working visas do not hold legitimacy granting them to work as a foreign entertainer in sex industry, according to Park.

“The victims all told me, ‘Our bosses never treated us humanely,’” Park said.

“It is important for Korea to recognize the existence of human trafficking in the country and improve its efforts to not only identify and assist the victims and persecute traffickers, but update relevant policies to effectively prevent human trafficking.”