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Inside a blue glass building overlooking the main river in Kabul sits a busy market where migrants looking for a better life begin their journey West.
It is here where Afghans seeking to cross the English Channel transfer payments to smugglers before venturing abroad, The Telegraph can disclose.
The bustling hub is home to hundreds of money exchange brokers that oversee a vast network of global transfers outside the traditional banking model.
They act as middlemen between migrants and smugglers by holding payments – made by people hoping to get to the US, UK, or other European countries through illegal means – in escrow accounts.
Only after a person successfully arrives at their destination do they instruct the broker to release the funds to the smuggler.
Worldwide, people-smuggling networks are estimated to net criminals billions of pounds. According to the European Commission, the total could be anywhere between £4 billion and £5 billion, as millions of people fleeing poverty and instability continue to leave their homes every year.
Investigating how this money is moved around the globe, a Telegraph reporter – posing as an Afghan national inquiring on behalf of a relative seeking passage across the Channel – was referred by a smuggler operating in Calais to one of the vendors at the Kabul market.
“My exchanger is only in Kabul and I will message you his number now. Just call him and say I gave you his number and send him the money,” the smuggler said.
“If your relative does not reach the UK, the vendor in Kabul will pay you back,” he said. “No one can steal your money ... You make your decision now, and he’ll be in Britain tomorrow.”
This practice, known as the “hawala” system, relies on interpersonal trust and allows for millions of dollars to be transferred around the world – all without a paper trail.
There’s no blockchain or Swift foreign exchange records, making it near-impossible for law enforcement to track the money trail which could be key evidence for use in court to tackle criminal smuggling networks.
“The goal is to transfer the money so it will be anywhere in the world,” said Yvon Dandurand, a fellow at the International Centre for Criminal Law Reform and Criminal Justice Policy based in Canada. Such methods “are not easily traceable; it could be in Pakistan, or wherever”.
“The beauty of this, for the smugglers, is that they don’t have to move the money [themselves] across borders, transfer it or send it.”
Phones ring off the hook in the Kabul market called Saraye Shahzadeh – which means “The Prince’s House” – as money brokers accept deposits and disburse payments using their own informal networks and keep records in shorthand using notebooks.
Some of these Kabul vendors specialise in sending money to specific countries, such as the UK or Germany, and work with only a few brokers based there. Others have a network that stretches across Europe.
This system means that money paid between migrants and smugglers does not physically move across borders to them directly, but instead via a series of transactions at the start and end of the transfer.
Many layers of funds change hands both at the source and at the destination.
Money brokers then eventually settle up between themselves, either earning a commission for putting through the transfers, or turning a profit by exchanging the money at a favourable rate.
In that sense, it’s similar to a bank charging a transaction fee when processing a transfer.
“The money flows like water – from families in Afghanistan to [migrant journey] facilitators in Turkey, from relatives in London to smugglers in France,” explains Haji Zia, who runs one such money exchange shop at the Kabul marketplace.
“Many exchange brokers transfer money to and from Europe that belongs to smugglers,” said Mr Zia “Without them, the whole [smuggling] network does not really function; they underpin the entire operation.”
The informal exchange system is thought to have come from the days of the ancient Silk Road trading route to facilitate payments and protect against theft.
Since then, “hawala” – Arabic for transfer or trust – has evolved in the modern era to primarily handle legal remittances between immigrants and relatives back home.
Many such families are often living in countries where access to banks is limited due to poverty, war or poor financial infrastructure.
Afghanistan, for example, was cut off from the international banking system after the Taliban seized control in 2021. There has been little effort since to improve the war-torn country’s lack of financial infrastructure.
In Iran and Iraq, sanctions in place for decades mean that even legitimate global banking transactions are impossible. Also people don’t often trust domestic banks, given political and economic instability.
But as illegal migration has spiked in recent years, the money transfer system has adopted new functions.
“People are trying to manage the risk on both sides,” said Mr Dandurand. “That the smuggler will only get paid later is a way for the person being smuggled to feel that there’s some protection against someone who would be defrauding them or not living up to the agreement.”
The hawala system is “also valued as it allows migrants and refugees to pay the smuggler and other service providers in instalments along the journey,” noted a 2023 report published by the UN Office on Drugs and Crime. In some cases, migrants pay a deposit up front pre-departure, then the rest upon arrival.
For both migrants and smugglers, this alternative transfer method allows them to guard against robbery or loss – few dare to risk losing their life savings in the water on boat journeys.
“People at the border may not stop you, but are interested in seizing whatever money you have,” said Mr Dandurand. “A lot of smugglers and people getting smuggled get extorted as they go through certain borders around the world, because of corruption.”
Many migrants take on significant debt to make payments to these vendors. Some sell their homes, businesses and land, while others borrow money from relatives – funds that they will have to repay regardless of whether they make it to their final destination.
Depending on the deal negotiated, some smugglers accept other forms of payment.
In Pakistan, residents told The Telegraph that people would sometimes give their cars to 59-year-old Master Uzair – among the country’s most wanted criminals – as partial payment for their journeys. Uzair put several people aboard the Adriana, which sank off the Greek coast in June 2023, killing at least 600 people in one of the most deadly Mediterranean migrant shipwrecks.
Top smugglers based in Turkey that head a vast global network have also told The Telegraph that they are increasingly taking payments in cryptocurrencies, using bitcoin or flashcoin, which are similarly difficult to track.
Cash is still accepted, though most migrants consider this option to be the least safe option.
“Or, if your relative wants to bring cash to the Jungle, that’s also OK,” one smuggler in Calais told an undercover Telegraph reporter, referring to the now-demolished sprawling migrant camp along the French coastline where people sheltered while waiting to cross to the UK.
Some migrants try to arrange their own money transfers.
“When the market is closed, they do it through Telegram groups,” said Aziz, a hawala broker in Afghanistan.
“There are messages where people say they have $10,000 in Switzerland, France, or Germany and want it in Herat (a city in Afghanistan), or the other way around,” he said. “These large sums are always funds linked to smugglers – no one [can afford to] send their family $10,000 all at once.”
Such money exchange shops are easy to find in the north London neighbourhoods of Finchley and Harrow, home to large Iranian and Afghan communities. Many have their names written in Persian and facilitate money transfers between the UK, Iran, and Afghanistan.
Turkey is also home to many of these brokers, as many migrants coming from the Middle East often pass through en route, and must arrange payments for the next leg of their journey – usually the segment that gets them to Europe.
In some areas of Istanbul, numerous shopfronts advertise the service; other brokers run these transactions out of corner markets selling soft drinks and snacks. Just west of the historic Hagia Sophia mosque in the Aksaray neighbourhood, vendors also sell life jackets – a one-stop shop for migrant needs.
Many smugglers have, over time, developed relationships with specific brokers in multiple countries.
One smuggler operating in Turkey, who facilitates passage to Italy, told The Telegraph: “If your money is in Iran, I’ll give you an exchanger’s phone number there; his name is Jafari. Pay him the money. And if your money is in Herat, you can keep your money with Haji Nazir.”
These days, the flurry of illegal activity taking place at “The Prince’s House,” is well-known, at least to much of the local population.
Chaotic scenes play out as traders clutch bundles of cash and bark out exchange rates for dollars, euros, rials, and rupees. Some have store fronts; others occupy stairways. A sudden price shift sparks a frenzy among dealers.
That this is a transit point for smuggling proceeds is “something everyone knows about and not a secret to hide”, said Mr Zia, who admitted that most vendors at the Kabul market, including him, generally “prefer to know as little as possible about the money’s origin [and reason for payment]”.
Bazaars in other cities, like Herat, also have numerous exchange brokers; some, too, similarly acknowledge that the profits from smuggling probably pass through their hands, but say it’s simply business, and one built on trust.
“They run it like a business because that’s exactly what they are doing,” said a local shopkeeper whose store is near the Kabul market. “They say they are only trading money, but many of them are transferring criminals’ money.”
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