Charity & Security Network Director Kay Guinane has authored a chapter in a new book from CAF America, Cross-Border Giving: A Legal and Practical Guide. Guinane co-authored, with Nancy Herzog of the National Endowment for Democracy, the chapter on U.S. Financial Transaction Laws and their Impact on International Grantmaking.
According to Ted Hart, President and CEO of CAF America, cross-border donors face daunting challenges. "Complex U.S. and international frameworks apply to cross-border giving, and a lack of understanding of these rules and regulations can result in excessive exposure to donors to risks impacting both their bank accounts and their reputation." The book covers topics such as ethical grantmaking, the closing space for civil society, equivalency determination and expenditure responsibility, preparing for an audit, and more.
Over the past decade, many banks have limited or terminated their correspondent banking relationships (CBRs) to a variety of regions, jurisdictions or categories of clients – a practice known as derisking. According to a new report from the World Bank, the effect of this practice varies widely from country to country and is does not affect broad categories of clients.
The report, The Decline in Access to Correspondent Banking Services in Emerging Markets: Trends, Impacts and Solutions, examined the impact of derisking through eight country case studies and found the effect at the macro level to be limited. At the same time, impact at the micro level is often intense, with banks losing access to the international financial system. Read more
A new report from the Human Security Collective and the International Center for Not-for-Profit Law examines the drivers of the global trend known as "de-risking" as it relates to nonprofit organizations (NPOs).
Inordinate delays in cash transfers, onerous due diligence requirements, inability to open bank accounts and arbitrary closure of bank accounts are all components of de-risking. The report, At the Intersection of Security and Regulation: Understanding the Drivers of "De-risking" and the Impact on Civil Society Organizations, examines these practices an looks at how regulations on money laundering and terrorist financing "permeate policymaking, influencing institutions (perversely, at times) and negatively impacting humanitarian and development work." Read more