Anti-terrorism financing

Anti-Terrorism Financing Overview

Date: 
January 16, 2012

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

Date: 
January 8, 2010

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.

Sen. Franken Supports Restoration of Money Transfers To Somalia

Date: 
February 1, 2012

A small number of Minneapolis-area Somali money transfer shops have reopened amid heightened scrutiny from banks, reports the Minnesota Star Tribune on Jan. 25, 2012. Though the amount transferable is limited to $500, the services are the only means many Somali-Americans have available to send remittances to family living in Somalia, a country lacking a functioning government or banking system, and plagued by drought and civil strife for almost 20 years. The inability of nearly 70,000 Somalis that live in the state to send money home had drawn strong criticism from Sen. Al Franken (D-MN) and other Minnesota legislators. At the end of December, the state's 14 Somali money transfer shops were shut down after the last Minnesota bank to wire money to Somalia closed their accounts.

Court Upholds Islamic American Relief Agency Asset Freeze

Date: 
February 27, 2007

On Feb.13, the U.S. Court of Appeals for the District of Columbia upheld a lower court decision that allowed the Treasury Department's Office of Foreign Assets Control (OFAC) to freeze the assets of the Missouri-based Islamic American Relief Agency. The court said the asset seizure was lawful because the court found the organization is an affiliate of a Sudanese group that was designated as a terrorist organization in 2004, making this the first case to allow such designation based solely on an alleged branch relationship. There was no finding that the U.S. group used funds to support terrorist activities, and no criminal charges have been filed.

Another Treasury Myth about U.S. Charities Busted

Date: 
October 18, 2011

U.S. charities are not alone in sending money overseas with little or no economic return back to the U.S.  In fact, unlike some of these areas (e.g. online gambling and remittances) that have little or no record of where the money goes, U.S. charitable groups and foundations must comply with Internal Revenue Service and state and local reporting requirements. Read more…

Wrong Way: Another Treasury Myth about U.S. Charities Busted

Date: 
October 17, 2011
 
The Department of Treasury has continuously mischaracterized international U.S. charities as a national security threat since 2001. In his 2010 testimony before Congress, Daniel L. Glaser, the Deputy Assistant Secretary of Terrorist Financing and Financial Crimes at Treasury said that charities were “an attractive target for terrorist organizations” because “[u]nlike for-profit organizations, charitable funds are meant to move in one direction only. Accordingly, large purported charitable transfers can move without a corresponding return of value.”

WikiLeaks Exposes Terrorism Funding Sources

Date: 
December 16, 2010
Author: 
Suraj K. Sazawal

Amidst all the “secrets” revealed in November 2010 by WikiLeaks, such as which First Lady had too much plastic surgery and where Qaddafi’s buxom personal nurse originates, it wouldn't have been hard to miss a few cables from the State Department identifying “the most significant source of funding” for terrorist groups like al-Qaeda.  

Was it donations from U.S. charitable groups? Guess again.  

New Treasury Rule Improves Access to Lawyers for Listed Charities

Date: 
December 15, 2010

For years, charities put on U.S. terrorist watch lists by the Department of Treasury (Treasury) have had problems defending themselves, in part because, except in limited circumstances, it was illegal for lawyers to represent them without first getting a license from Treasury. That could be a slow and difficult process. But on Dec. 7, 2010 Treasury took a significant step toward solving this problem by issuing new regulations that permit free legal services and make it easier to arrange payment for lawyers. The move follows an ACLU lawsuit involving the old regulations. 

Judge Hears Former Charity Heads Appeal in Tax Case

Date: 
October 27, 2010

On Oct. 4, 2010, three leaders of Care International Inc., a defunct Massachusetts charity, argued their appeal of convictions for failing to report information about the charity’s newsletter to the Internal Revenue Service (IRS).   In 2005 federal prosecutors accused them of supporting jihadist movements.   Despite the prosecution’s claim that the cases were about supporting terrorism, the only charges made were related to tax fraud and no evidence of the use of charities to promote terrorism was produced during trial. 

Convictions Based on Publications Raise New Questions for Nonprofits

Date: 
January 23, 2008

On Jan. 11, three former leaders of an Islamic charity based in Boston were convicted of tax fraud and making false statements because they did not include a description of their newsletter and its content in their tax-exempt status application and annual Internal Revenue Service (IRS) Form 990 filings. The prosecution argued that the now-defunct group, Care International, supported jihadist movements in articles in its newsletter and postings on its website. The defense argued that no funds went to jihadist groups and that the leaders were being prosecuted for expressing unpopular political views. The convictions, which could result in prison terms of up to five years, are being appealed. The circumstances of the case, combined with public statements of the prosecutors, raise questions about the free expression rights of nonprofits and the level of detail required when reporting to the IRS.

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