It could be the first step toward issuing its own currency or it could be a way for the leadership of the organization to make a quick profit. One thing is for certain—the terrorist group calling itself the Islamic State of Iraq and Syria or ISIS has outlawed the use of the two largest denomination bank notes issued by Syria.
ISIS’ Hisbah or religious police office in the occupied city of Raqqa is responsible for a memorandum banning the bank notes. A translation of the memorandum reads:
“Announcement to all exchange shops: We have decided, with the help of God, to ban the use of the newly issued currency by the Alawite regime (the 1,000 [pound] bill and the 500 [pound] bill) in our territory, starting the date of the announcement, Sept. 27. Exchange shops should not use it or exchange it. They should only take it out of the Islamic State areas. And anyone who opposes this law will be punished, starting from Nov. 14.”
The banned bank notes are to be replaced with older or smaller denomination notes. No mention was made of any coins. The banned notes are planned to be dumped in areas outside the jihadist group’s controls, according to a memorandum obtained by the media organization Syria Deeply.
ISIS Hisbah member Abu Muhammad told Syria Deeply, “We prohibited their circulation in order to protect Muslims from financial losses. There are other bills that people can use. We want them to exchange these newly issued bills with other ones, so that they do not lose any money, especially if they want to use them outside Syria.”
Muhammad told Syria Deeply that ISIS will soon issue its own gold, silver, and copper coins as the only currency accepted in areas under the group’s control. The idea of ISIS specie coinage circulating successfully is improbable. Beyond that the counter-terrorism unit of the police in Gaziantep, Turkey arrested six foreign nationals in October. These individuals had been operating a makeshift mint producing the ISIS precious metal composition coins in Sahinbey, a town south of Gaziantep.
ISIS has previously said it will issue the specie coinage, but that it would only be legal tender inside territory the organization controls. This, of course, is unrealistic logic since merchants anywhere would accept, then hoard, the coins due to their precious metal content.
Several news media outlets said merchants and citizens in Raqqa typically store most of their savings in Syrian large denomination bank notes. It has been suggested ISIS currency traders will benefit from the ban on these notes by making profits on otherwise illegal currency exchange trading.
Mazen al-Abdalla is a media activist living in Raqqa. According to Abdalla, “For months now the word on the street has been that ISIS would issue its own gold and silver currency, and that Syrian currency would eventually be eliminated.”
Abdalla also said the change in currency is more of a scheme through which non-Syrian jihadist fighters can make money than a move toward justifying ISIS as a legitimate independent state. Many local citizens have been quietly exchanging their foreign currency for months in anticipation of the new law.
“We’re talking about exchanging and taking an entire currency off the market,” said Abdalla. “There’s a lot of money to be made.”
Syria Deeply reported, “Rumors that ISIS’s monetary authorities in Raqqa may soon issue their own currency have left Raqqa’s citizens equally panicked.”
The government of Syrian President Bashar al-Assad opposes ISIS’ occupation of some of its territory.
The Central Bank of Syria issued a new 500-pound bank note on Aug. 1, 2014, followed by a new 1,000-pound bank note on June 30, 2015. The 500-pound note depicts a vignette of the Syrian Opera House on the front, with a mosaic of the first music note in the world on the back. The 1,000-pound note depicts a vignette of a Roman theater in southern Daraa on the front and a Roman mosaic painting found at Sweida on the back.
The notes replaced earlier Central Bank of Syria notes on which former Syrian President Hafez al-Assad was featured. The newer notes have a micro-perforation anti-counterfeiting feature lacking on smaller denomination bank notes.
This article was originally printed in World Coin News.
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