"Hawala" derives from the Arabic root h-w-l, which means "change," "transform," or "transfer." In the Hindu interpretation, hawala gained the additional meaning of "trust," which reflects how this informal banking system works. The typical economic transaction on which the research focuses is a transfer of funds, which includes the dispensing of funds to clients and the settlement process between financial agencies. It consists of a client in a jurisdiction (Canada or the United States) approaching a financial agent in the community and requesting a transfer of funds to another individual who resides in the same or another jurisdiction. The financial agent who accepts the funds executes the transaction through another financial agent who resides in the second jurisdiction. The transaction typically takes between 24 and 48 hours. Accounts are settled between the two financial agents via various methods. These informal transaction processes are becoming an increasingly important target for security regulations and enforcement, since they are believed to be the funding transfer mechanism used by terrorists. Following general observations regarding financial agents under the hawala system, this report focuses on its operation conducted by Afghani, Pakistani, and Indian financial agents. Although reluctant to share some information about their business, interviewees were concerned that the importance of their business to financial transactions in their cultures be respected and not outlawed or overly regulated. This report recommends the creation of a Self Regulatory Organization that consists of the financial agents and other agents that offer other financial services that can assist the government and the financial agents. 52 references and an attached list of interview questions