How to report misuse of charity funds in Saudi Arabia

How to report misuse of charity funds in Saudi Arabia

Ever been plagued by annoying messages asking for donations? With the advent of the holy month of Ramadan, the calls to collect alms and donations for poor people are increasing.

Usually, charitable organizations supervise these donations and the journey of the benefactors who make the donation ends when he or she delivers the donation. After that, the responsible charity will distribute donations to those in need. However, sometimes contributions fall into the wrong hands and are used for financing terrorism and extremist movements. 

Unfortunately, over the past decades, non-profit organizations have been the golden goose financing terrorist projects that seek to destroy nations and break down societies.

Recently corrupt organizations have started using television adverts and communication via text messages to collect large numbers of donations. They employ the trick of splitting up donations — spending some of the funds on legitimate operations and using the rest to finance terrorist activities.

This sensitive topic is being highlighted to warn people as there are legal consequences for this. Efforts must be employed to identify the corrupt use of charity funds to prevent donations being used for malign purposes.

At the end of 2013, Saudi Arabia introduced Combating Terrorism and Financing of Terrorism regulations, referencing nonprofit institutions as one of the means by which terrorists may hide behind. The system gave prosecutors the right to request records or documents from a suspicious institution. In return, the system has obliged the institutions to implement the application in a full and accurate manner.

Moreover, any person who contributes in whole or in part in collecting or transferring funds shall be punished by imprisonment of at least five years and up to 15 years. Such punishment shall also include those who were aware of the intention to use these funds in suspicious operations. Also, the regulation clearly states that in case of any misuse of a position to benefit such acts, the imprisonment sentence shall not be less than 10 years.

It is important that each nonprofit organization establishes the regulations and memoranda required to confirm its understanding of the risks of such acts and how to control this type of funding. The Ministry of Labor and Social Development is responsible for the supervision of these charities’ workflow and accessing their data and records to ensure that they are consistent with the purposes for which they were established. 

At the international level, Saudi Arabia has become a member of several organizations such as the Financial Action Task Force for the Middle East and North Africa Task Force on Combating Terrorist Financing and Money Laundering, which is also working to take measures across the region to combat money laundering and terrorist financing in a way that does not conflict with the cultural values of member states, their constitutional frameworks and their legal systems.

If an individual becomes aware of any attempt to make a suspicious transaction, he or she should inform the General Directorate of Financial Investigations at the Ministry of Interior, a public department at the Ministry of the Interior and directly linked to the minister of the interior, immediately. The directorate will ensure that the source’s anonymity is preserved. 

The directorate’s main task is to receive reports of suspicious financial transactions, analyze them, report them to the authorities and save the information to their own database for reference. It also exchanges information with relevant authorities inside and outside the Kingdom and coordinates with them to combat the financing of terrorism and money laundering.

• Dimah Talal Alsharif is a Saudi legal consultant, head of the health law department at the law firm of Majed Garoub and a member of the International Association of Lawyers. Twitter: @dimah_alsharif

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