By JOANNA SLATER, The Wall Street Journal
HAYMARKET, Va. One recent afternoon, New York money manager James Rickards presented Sheik Yusuf Talal DeLorenzo with a dilemma: Could his hedge fund be Islamic-friendly?
Islam prohibits all kinds of speculative behavior that is embedded in Wall Street’s DNA. But Mr. DeLorenzo, a Massachusetts-born convert to Islam, is on a mission to meld centuries-old Islamic law with modern finance in the U.S.
Mr. Rickards’s fund couldn’t bet on currency futures or some of the shares in the Standard & Poor’s 500 index, Mr. DeLorenzo said, if he wants observant Muslims to invest. But some alterations could earn the sheik’s approval such as holding currencies instead of futures, and buying only S&P 500 companies that aren’t debt-heavy or dependent on profit from interest payments. “Music to my ears,” Mr. Rickards said. “It sounds like I can still get the effect I’m looking for.”
With the Middle Eastern economy booming, partly thanks to soaring oil wealth, the Islamic financial industry has been expanding at a clip of about 15 percent a year, according to accounting firm KPMG, and is on pace to reach $1 trillion in two years. The money is seeking new outlets and Western financial institutions are seeking new clients opening the door for more aggressive methods to reconcile two worlds that don’t easily mesh.
The issue of what’s permissible has opened fault lines within Islamic finance. Malaysian adaptations of Western-style bonds, for instance, have been condemned, then copied, in Muslim countries in the Middle East. Scholars consulting for Western financial institutions are criticized for bending religious laws to serve financial ends the “rent-a-sheik” argument, says one U.S. bank official. Vendors profit by “capitalizing on people’s religious insecurities,” says Mahmoud El-Gamal, a professor of economics who holds a chair in Islamic finance at Rice University. “Don’t take my duck, sprinkle holy water on it, and say it’s a chicken.” [more]
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The Islamic Workplace 
hijabs
August 14, 2007
We have a hijab store in London where we were considering offering Islamic Finance through a larger Islamic finance firm but due to the controversy we are having second thoughts, it is not very easy to make up your mind on whether this is right or wrong.