Charity & Security Network is tracking the following bills during the 116th Congress:
Legislation endorsed by the Charity & Security Network passed the U.S. House of Representatives November 27, 2018.
The Global Fragility and Violence Reduction Act of 2018 (HR 5273), introduced March 14, 2018, and passed by the House Foreign Affairs Committee September 27, would require the U.S. Department of State, in partnership with the U.S. Agency for International Development (USAID), the U.S. Department of Defense, and other federal agencies - in collaboration with global civil society - to develop a 10-year strategy to bring down current levels of global violence and better address the root causes of violence, violent conflict, and fragility that drive recurrent global crises. Read more
The House Committee on Financial Services’ Subcommittee on Terrorism and Illicit Finance heard testimony from five expert witnesses in a hearing entitled Survey of Terrorist Groups and Their Means of Financing on September 7 2018. Ms. Katherine Bauer of the Washington Institute for Near East Policy noted that “critics are right to highlight the high costs of anti-money laundering and CFT regulation…and the need to better balance some of the competing but equally important priorities, such as the efficient delivery of timely humanitarian aid.”
The Charity & Security Network (C&SN) responded to misinformation in statements about nonprofit organizations (NPOs) made in a July 11 hearing in the National Security Committee of the House Oversight and Government Reform Committee in an Aug. 14 letter, saying such statements “inaccurately and unfairly portray the U.S. charitable sector as a source of terrorist financing. Such statements undermine the important work U.S. NPOs do around the world and fail to recognize the high levels of transparency, oversight and good governance they employ.” The letter addressed three main problematic themes from the hearing in detail:
- Asserting that, because Treasury has not designated any U.S. NPOs as supporters of terrorism since January 2009, there is a problem of lax enforcement. This ignores the vigilance of law enforcement as well as the charitable sector’s due diligence and good governance practices.
- Citing the criminal prosecution of the Holy Land Foundation as a model for government action against NPOs, despite the numerous and serious legal issues that render that case an outlier.
- Uncritically citing conclusions in the Middle East Forum’s June 2018 report on Islamic Relief USA as fact, when assessment of key allegations demonstrate that the report is based on inadequate background research and uses faulty logic.
In addition, Islamic Relief USA, which was a special target of misinformation and mischaracterization of facts, published a rebuttal on its website. The C&SN letter noted that, “Overall, the hearing gave the impression that Muslim NPOs are to be targeted based on their ethnic and/or religious associations, rather than on conduct that threatens national security.”
Although the primary focus of a July 11, 2018 House hearing on “The Muslim Brotherhood’s Global Threat” was on foreign organizations, the testimony of several witnesses raised the specter of a coordinated campaign against U.S. Muslim humanitarian and civil rights organizations. Many statements in the hearing reflected outdated and often discredited assumptions about how they operate. In the hearing, conducted by the National Security Subcommittee of the House Oversight and Government Reform Committee, subcommittee members and witnesses sharply disagreed about whether the Muslim Brotherhood presents a unified threat to the U.S. and what the foreign and national security policy approach should be. The video of the hearing is here.
The House Natural Resource Committee is intenseifying its ongoing investigation to “examine foreign influence on U.S. natural resource and environmental policy.” On June 13 it asked the Department of Defense (DOD) for an assessment on how a number of U.S. environmental organizations’ litigation against DOD impacts national security. A week later it sent the Center for Biological Diversity a letter demanding extensive information on its advocacy regarding relocation of a U.S. military base in Okinawa. (This follows a similar inquiry sent to the Natural Resources Defense Council on June 5.) The committee is using vague provisions of the Foreign Agent Registration Act (FARA) in an attempt to equate traditional forms of policy advocacy involving international affairs, including litigation, with being an agent of a foreign government. This is strikingly similar to a tactic used by Russia and other non-democratic governments to limit the voice of civil society.
The TAILOR Act (HR 1116), which passed the House of Representative on March 14, 2018, appears to promote implementation of the risk-based approach by bank regulators. It requires federal bank regulators to take “risk profiles and business models” of financial institutions into account when taking regulatory action. Regulators would be required to determine the appropriateness and impact of regulatory action and tailor regulatory action to limit compliance impact, cost, etc. via a risk profile. Regulaory action is defined as "any proposed, interim, or final rule or regulation, guidane, or published interpretation." The agencies would also have to review all rules promulgated in past seven years and make them consistent with this standard. The bill was sent to the Senate and referred to the Banking Committee. A companion bill, (S 366) was filed in the Senate in 2017 by Sen. Mike Rounds (R-SD). Democrats on the House committee filed a minority report opposing the bill because it could result in litigation by banks that would tie up the regulatory system.
On Dec. 19, 2017 leadership in the House Foreign Affairs Committee proposed HR 4681, the “No Assistance for Assad Act,” that would bar U.S. government funded reconstruction assistance to Assad-controlled areas of Syria unless the President certifies that specific conditions are met. The bill exempts humanitarian assistance (with some conditions) and projects sponsored by local communities. It would apply from fiscal years 2018-2022.
Both the House of Representatives and Senate held hearings in late November on proposed legislation to update the 50-year-old Bank Secrecy Act (BSA), which is the primary law setting out anti-money laundering and counter terrorist financing (AML/CFT) rules for banks. While the bills in each house vary, statements in the hearings echoed the same theme: the world has changed substantially since the BSA was updated in 2001 and gaps and strains in the AML/CFT system need to be addressed. However, neither bill addresses the negative impacts of bank “derisking” (dropping accounts or limiting services) on nonprofit organizations (NPOs) or financial inclusion goals. The contradiction between the strict liability for violations in the current AML/CFT regime and the need for a proportionate, risk-based approach, cited by the Financial Action Task Force in 2016, was also not discussed. The move the update the BSA and related AML/CFT laws presents both opportunities and challenges for NPOs in 2018. The legislation and testimony is summarized below.
Investigations into Russian interference in the 2016 U.S. election has generated high interest in the Foreign Agents Registration Act (FARA), which requires registration and disclosure by those acting “for or on behalf of” foreign governments and entities. Now several bills have been introduced in Congress to strengthen FARA. Such amendments have the potential to create problems for nonprofit organizations (NPOs) and should be closely monitored and analyzed if any move forward. FARA has been cited as a model to justify restrictive legislation in several countries that target NPOs and infringe on their rights of association, assembly and expression. This analysis provides background on FARA, a description of pending bills in Congress and links to summaries of foreign laws that distort FARA’s legitimate aims in order to close civil society space.