An excellent question about the Somali pirates and all that ransom dough.

Where the hell are they keeping it?  Back in November, Kenya's Foreign Minister estimated the amount for 2008 alone to be at $150 million.  (I've seen the $100 million number thrown around, too.)  Anyway you slice it, that's a lot of jack to keep lying around. 

From Media Monitors Network.

Where in Somalia are these pirates hiding the $100 million, which is in cash, not bank drafts? On the one hand, they are free to do as they please with the money because they have no fear of being arrested because there is no government to impose law and order. On the other hand, Somalia has no banks, so if the pirates have made deposits, in which country or countries are the banks?

It begs answering, because if you believe this piece - the 'wafer-thin banditos' are spending $500,000 out of every million on food, snacks and cigarettes.

According to Farah Ismael Eid, a pirate who is serving a 15-year term In Somalia´s notorious Mandera prison, the money he and his pals collected was divided thus: 30% for government officials 20% for the bosses, 20% for necessities like guns, food and cigarettes, 30% for the gunmen.

That is a lot of ciggies folks. If one is to believe these figures that means pirates spend $500,000 out of every million-ransom dollars on snacks, smokes and guns. One assumes these wafer thin bandidos are not big eaters, and an AK-47 can be bought in this part of East Africa for under $100 bucks. This means Somali pirates are puffing their way through almost half a million dollars in cigarettes every week.

But if you believe this piece - - the piracy operations are run like a classic MBA school exercise and  Dinah's here to tell you there's no way those types are not going to earn the float off of $100 mil. 

What?  What's that you say?  The pirates' roughly $250,000 worth of seed capital is provided from a successful Somali outside of the country through the Hawala money laundering system?  Well, what do you know.  (Have a little time to kill?  You can listen to the NPR's Money Planet podcast on the subject referencing the role of Hawala in pirate financing here.  Starts at the 10:00 minute mark.)

Gee, do you think that is the way that the money is getting out of the country, too? 

Um, yes. 

In other pirate news (slightly tardy - but better late than never)  US hands over 3 dead pirates to Somalian police.

And just to maintain my personal record of the Islamist - Pirate linkage.  (Because the pirate attacks continue apace and you know the question is going to come up again and again.)

From AINA.

Already, senior Al-Qaeda member Sa’id Ali Jabir Al-Khathim al-Shihri, has instructed his Somali allies to "increase your strikes against the crusaders at sea and in

Djibouti

." Earlier in April, an al-Shabaab spokesperson praised the pirates, saying they were "protecting the coast against the enemies of Allah." The leader of the Ras Kamboni Brigades, another radical Islamic group said to be linked to Al-Qaeda, said the pirates were "part of the Mujahideen" despite being "money-seekers." Those that dismiss the possibility of a link between pirates and terrorists underestimate the forces of radical Islam’s ability to establish relationships of convenience, and underestimate the greed of pirates with a clear will to bypass principles for the sake of profit.
...

At the Somali Piracy Conference on April 7, Ambassador David H. Shinn conceded there was "no evidence that piracy is directly linked to international terrorism, although many Somali groups get a cut of the ransom money." Citing Jane’s Intelligence Review, Shinn explained that the two forces cooperate on arms smuggling, and the pirates are reportedly helping al-Shabaab develop maritime capabilities.

While the relationship is based on business and not ideology, it doesn’t make it any less beneficial to al-Shabaab. He says that they sometimes receive a "protection fee of 5 to 10 percent of the ransom money. If al-Shabab helps to train the pirates, it might receive 20 percent and up to 50 percent if it finances the piracy operation."

Andrew Mwangura, the head of the East African Seafarers’ Assistance Programme, has also said such a link exists. He told Reuters in August that "According to our information, the money they make from piracy and ransoms goes to support al-Shabaab activities onshore."

Nor is al-Shabaab the only radical Islamic group utilizing piracy. According to The Long War Journal, "Al Qaeda’s regional affiliate, Jeemah Islamiyah, is often engaged in piracy, as are the Philippine affiliates Moro Islamic Liberation Front (MILF), Moro National Liberation Front (MNLF) and the Abu Sayyaf Group. The pirates and terrorists are often one in the same, or if not, are in close cooperation."