Center for Security Policy issues repeated warnings to the SEC and Federal Reserve on Shariah-Compliant Finance.

Go the link in the title to this blog entry (reminder: click once for blog entry unique url and once again for linked article). The link is to our previous blog on the dangers of Shariah-compliant finance with good backgrounder links.

Now, if you’ve clicked through the title once and are at this blog entry’s unique url, you will see several Adobe .pdf files for downloading. This is the narrative unfolding.

The first 4 PDF files are letters from Senator Jon Kyle (R-Ariz) to, respectively, SEC Chairman Chris Cox, Fed Chairman Ben Bernanke, Treasury Secretary Paulson, and Attorney General Mukasey. The letters are essentially the same but focus on the recipient’s particular government portofolio. Sen. Kyle’s letter was in essence a request for a substantive response to the legal memorandum on Shariah-compliant finance (SCF) authored by David Yerushalmi on behalf of Frank Gaffney’s Center for Security Policy.

Only Cox and Bernanke have responded to date. These two responses are attached. Attached to Cox’s letter is an IOSCO Report he references in his letter to Kyle.

Following these, you can read the response to Cox and Bernanke from Messrs. Gaffney and Yerushalmi in the next PDF files. Also, a separate analysis of the IOSCO document is attached, which illustrates its irrelevance to the discussion suggesting quite clearly that Cox is deflecting rather than being responsive to Sen. Kyle’s query. We have also attached the cover letter to Kyle from Messrs. Gaffney and Yerushalmi.

Stay tuned for the next salvo.