Expose Finds World-Check Riddled with Errors

A February 4 expose in Vice News finds that private list-checking service World-Check erroneously lists individuals and orgnizations, predominantly Muslim, as terrorists. The article confirms what charities have heard for years, that groups with no ties to terrorism are listed in the database, used by 300 government agencies and 49 of the 50 largest banks, fueling the de-risking phenomenon. Because banks have no legal obligation to tell customers why their accounts are being closed, and because World-Check binds its users to secrecy, de-banked entities have had no way of determining the source of their woes. Those that have been able to trace the problem find that there's no clear path to successfully challenge an erroneous listing, according to the article. 

Read our blog here

58 Humanitarian, Grantmaking Organizations Ask U.S. Treasury, State for Help with Access to Banking Services

Fifty-eight nonprofit organizations (NPOs) from around the world, including umbrella groups with more than 300 member organizations, have sent a letter asking the U.S. Departments of Treasury and State to convene a multi-stakeholder dialogue as part of a broader effort to ensure that registered, law-abiding NPOs are able to access the global financial system. The signatories to this letter represent more than $8.3 billion annually in humanitarian aid and services to the world’s most needy. 

Read the letter here

More than 50 Organizations Ask U.S. Treasury, State for Help with Access to Banking Services

Date: 
February 24, 2016

On February 25, 2016, 58 nonprofit organizations (NPOs), including umbrella groups with more than 300 member organizations, sent a letter to the U.S. Departments of Treasury and State asking them to convene a multi-stakeholder dialogue as part of a broader effort to ensure that registered, law-abiding NPOs are able to access the global financial system.

Our Fears Confirmed

Date: 
February 10, 2016
Author: 
Andrea Hall

We've been hearing for years that private list-checking services such as Thomson Reuters' WorldCheck were riddled with errors and were perhaps a major driver of the bank de-risking problem. Muslim charities with no connection to terrorism, the rumors held, were somehow finding themselves on these programs, leading banks to terminate long-held client relationships. 

Bank De-risking Represents Market Failure, Report Says

Date: 
December 10, 2015

Bank de-risking represents a market failure. In such instances, either government or the public sector must intervene to re-align market factors, either through incentive programs or through enhanced regulatory guidance, concludes a new report from the Global Center on Cooperative Security and Oxfam America, Understanding Bank De-risking and its Effects on Financial Inclusion.

According to the report, the goals of financial inclusion and anti-money laundering and countering the financing of terrorism (AML/CFT) are not inherently in conflict, although tensions emerge in practice. Overly restrictive AML/CFT measures “may negatively affect access to financial services and lead to adverse humanitarian and security implications,” the report states. It adds that de-risking actually contributes to increased vulnerability by “pushing high-risk clients into smaller financial institutions that may lack adequate AML/CFT capacity, or even out of the formal financial sector all together.” 

Show Me the Money?

Date: 
December 4, 2015
Author: 
Andrea Hall

"Show me the money," Tom Cruise famously said in the 1996 film Jerry Maguire. Now, three weeks after the Paris Attacks, counterterrorism "experts" across the pond, channel and elsewhere seem to be saying the same thing: find the funding sources for these terrorist groups, cut them off, and you'll solve the problem. 

Not so fast. An array of overbroad counter-terrorism financing laws and policies have not only failed to stop terrorism over the past decade and a half, these very laws may ironically be responsible for forcing money into unregulated channels. Financial institutions can hardly keep up. With the ever-increasing costs of compliance, and a steady increase in the number and volume of fines, is it any wonder that financial institutions are cutting off relationships with any customer suspected of being the least bit risky?

Pages