UPDATED: Treasury Data Shows Charities Not Significant Source of Terrorist Support

Printer-friendly version

There is debate over how much of a threat charities (and U.S. charities in particular) pose to national security. In public statements and meetings with the Treasury Guidelines Working Group, Treasury has made broad statements charging the charitable sector with being a significant source of terrorist financing and support. But evidence to support these claims has not been forthcoming. As a result, there has been significant disagreement between Treasury and the nonprofit sector on the extent and nature of the relationship between charities and terrorists. The issue is highlighted by the fact that Treasury's Annex to the Guidelines only cites examples of foreign charities.

Treasury bases its position on a claim that 15 percent of terrorist financing comes from charities or individuals associated with charities.[1] This figure is misleading because it:

• Distorts the data by using the number of designated individuals, companies and organizations on Treasury's Specially Designated Nationals (SDN) list, and not the total dollars alleged to have been diverted to terrorists;
• Unfairly lumps individuals and charities together;
• Ignores what is known about major sources of terrorist financing.

Using information from Treasury, it is clear that charities do not make up a significant portion of SDGTs. These figures suggest that U.S. based charities represent less than two percent of organizations with suspected ties to terrorists. It also suggests that the threat associated with charities has decreased.
 
Table 1: Charities & Individuals Associated with Charities on OFAC's 2006 SDN List

 (Of approximately 480 entities listed on the 2006 OFAC list)

 
Table 2: Charities & Individuals Associated with Charities on OFAC's 2009 SDN List

 (Of approximately 530 entities listed on the September 2009 OFAC list)

*This includes KindHearts for Charitable Humanitarian Development, which has not be designated as an SDGT but its assets were frozen in February 2006.
 
Terror Assets report 2008

Data from the Terrorist Assets Report Calendar Year 2008 Seventeenth Annual Report to Congress on Assets in the United States of Terrorist Countries and International Terrorism Program Designees [2] further raises questions about how much of a threat charities pose.  According to the report, as of December 31, 2008, the U.S. government had seized $24,880,496 from U.S entities. Compared to the amount seized from state sponsors of terror ($473,600,000), the money from charitable groups is dwarfed.  The Terrorist Assets Report, which is prepared by OFAC is based on information from the Department of the Treasury and other Government agencies and nongovernment parties.
 
Table 3: Percent of Frozen Assets

**There is no publicly available information on how much of this amount includes charitable funds, or as a subset, how much includes funds of U.S. charities.
 

[1] Annex, Anti-Terrorist Financing Guidelines, 2006 version, at http://www.treas.gov/press/releases/reports/0929%20finalrevised.pdf

[2] TERRORIST ASSETS REPORT Calendar Year 2008 Seventeenth Annual Report to Congress on Assets in the United States of Terrorist Countries and International Terrorism Program Designees