The growing focus on terrorism is unfairly raising suspicion about Muslim charities, warns Abdurahman Sharif.

Recent comments on charities and extremism made by William Shawcross, chair of the Charity Commission, indicate how charities are perceived negatively by UK policymakers as entities that can easily be abused.

Charities around the world have come under greater levels of scrutiny over the past decade as new, and ever more stringent, counter-terrorism measures have placed their operations under the microscope.

Pressure on charities

The implementation of these initiatives has considerably reduced the humanitarian space within which all international NGOs have been able to operate, particularly impacting their ability to assist people in volatile, high-risk regions, such as Somalia and Syria.

In Somalia, for instance, the decrease in aid as a consequence of counter-terrorism legislation is considered to be one of the factors that contributed to the famine there in 2011.

The burden of suspicion has fallen disproportionately upon Muslim charities, whose activities, funding streams and financial transactions have been unreasonably scrutinised.

There are over 2,000 Muslim charities in the UK, with a significant proportion of these organisations carrying out some form of international humanitarian work.

A number of reports and research papers – for instance, see Islamic charities and the war on terror: dispelling the myths, ODI, 2007 – have argued that, rather than protecting charities from abuse, increasing levels of regulation have actually restricted the work of legitimate charities.

Regulations have affected charitable activities at different levels. Many countries have struggled to find a consistent approach to registering and regulating non-profit organisations, with governments experiencing difficulties in managing the large administrative burden involved.

Where independent regulators like the Charity Commission haven’t been created to carry out this role, financial institutions have been used instead, to ensure funds are not channelled to illicit activities.

This has been problematic, because financial institutions lack sufficient knowledge of the charity sector to investigate claims appropriately.

Many banks have simply adopted a zero-tolerance approach by rigorously policing all financial transactions.

Even in jurisdictions which do have charity regulators, the legal framework requires banks to regulate charitable transactions right across the ‘money chain’. Scrutiny of the money trail is exacerbated by government rhetoric about the risk charities pose and ‘due diligence’ software that highlights uncertainty.

NGOs working in high-risk countries regularly face significant delays in the transfer of money by banks, which is having a damaging impact on the speed with which they can deliver emergency aid.

Inquiries into the activities of Muslim charities, most of which found no evidence of foul play, have increased feelings within the sector of a lack of trust, and have harmed the reputation of these charities among donors.

Breaking the bottleneck

The way the new regulations are being implemented needs to be assessed and better understood by all parties.

Developing an increased understanding of each agency’s obligations would be a good place to start. Financial institutions often need better information about how an international NGO intends to deliver its services on the ground, and – for their part – many charities need to be more aware of the internal working practices and organisational requirements with which their bank has to comply.

Similarly, policymakers should engage in discussions with the regulators and the NGOs to better understand the damaging impact counter-terrorism legislation is having on charitable activity.

In particular, there needs to be an acknowledgement of the way in which Muslim charities feel targeted and stigmatised by these measures, and how they are specifically affecting the capacity of these NGOs to deliver humanitarian aid in many parts of the world where it is so desperately needed.

Abdurahman Sharif is operations manager at the Muslim Charities Forum.