On Feb. 17, 2009 a Swedish court in Malmo acquitted the head of a charity of charges that he financed terrorism through a charitable group. Khalid al-Yousef, the leader of al-Aqsa Spannmal (Grain Foundation), faced a six year jail sentence if convicted. It has also been reported that $150,000 in donations raised by the charity which had been frozen by the United States and Britain will be returned.
The rising numbers of attacks against global aid workers is threatening their safety and the humanitarian work they provide in many of the worlds' turbulent areas. Government action that intrudes into the operations of nongovernment organizations has contributed to the problem, according to experts. In the U.S. a proposal to require United States Agency for International Development (USAID) grant applicants to collect and submit personal data on program partners threatens to exacerbate the situation.
In a letter sent Nov. 6, a group of charities and nonprofit sector leaders asked the Treasury Department to release frozen funds belonging to charities designated as supporters of terrorism "to trustworthy aid agencies that can ensure the funds are used for their intended charitable purposes."
Nonprofit leaders recently called on the Treasury Department to withdraw its anti-terrorism financing guidelines for charities and to replace them with principles developed by the charitable community. Treasury's Anti-Terrorist Financing Guidelines: Voluntary Best Practices for U.S.-Based Charities, were initially issued in 2002 and revised on Dec. 5, 2005. Treasury sought comments on its revision, despite their having been operational since Dec. 5; it is unclear how the department will use the comments submitted by the nonprofits.
BNA Money and Politics reports that the Council of Foundations sent a letter to Treasury Secretary Paulson on behalf of the Treasury Guidelines Working Group. OMB Watch is apart of the Working Group, that is once again asking for the withdrawal of the Anti-terrorist Financing Guidelines: Voluntary Best Practices for U.S.-based Charities.
President Obama's June 4 speech in Cairo had encouraging words for nonprofit organizations in the U.S. and around the world, as he recognized that U.S. charitable giving rules have made charitable donations difficult for Muslims and committed himself to working with American Muslims to resolve the problem. The Charity Security Network and Muslim Advocates each responded with statements pledging cooperation in developing new rules that protect and promote legitimate charitable programs and their donors, both Muslim and non-Muslim.
The Court of Appeals for the Ninth Circuit upheld a ruling declaring the statute making it a crime to provide "material support or resources" to any group designated a "foreign terrorist organization" as unconstitutional. The decision reaffirmed that previous attempts to adjust the statute failed to do so.
Effective as of December 2008, the U.S. Department of Treasury's Office of Foreign Assets Control (OFAC) has expanded its scope of mandatory licensing affecting legal services available under the Global Terrorism Sanctions Regulations and payment for legal services under the Foreign Terrorist Organizations Sanctions Regulations.
Donors are growing increasingly weary as court decisions against charities have created an environment of suspicion for numerous Muslim charities. The decrease in contributions will lead to smaller numbers of people receiving relief.
USAID has released a notice of its proposed "Partner Vetting System" (PVS) for nonprofit and charitable groups. This policy creates unnecessary and potentially dangerous barriers for humanitarian groups from providing relief in global hot spots. Its final implementation will be determined by members of the Obama administration.