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Banks’ fear of breaching counter-terrorism laws hinders the work of UK charities in Syria – new report

Written by Sara Pantuliano

Press Release

​Press release
Embargoed until Thursday 5 March 00:01 GMT

Banks’ fear of breaching counter-terrorism laws hinders the work of UK charities in Syria – new report

A lack of guidance from the UK Government, specifically the Treasury, on how banks should respond to counter-terrorism legislation has resulted in overly risk averse actions being taken towards UK charities working in conflict zones says new report launched today.

Driven by a fear of financing terrorism which is a breach of this legislation, international banks including HSBC, UBS and NatWest are effectively “de-risking” by closing and freezing bank accounts held by these charities and delaying, blocking or returning millions of pounds of donations with “no detailed explanation” says the report by UK think tank the Overseas Development Institute (ODI).

“Tens of thousands of people in conflict areas such as Syria, Somalia and Gaza are depending on the life-saving assistance provided by UK charities, but these are precisely the locations that present the highest risks to banks under the counter-terrorism legislation,” said an independent researcher for the ODI’s Humanitarian Policy Group (HPG) Tom Keatinge.

For example, one charity which requested to remain anonymous was forced to forgo donations worth £2 million in the last 12 months as a result of funds being blocked by a bank. Salaries paid to the bank accounts of aid workers who live outside of the UK have also been delayed or blocked by banks.

The report ‘UK humanitarian aid in the age of counter-terrorism: perceptions and reality’ recommends that the UK Government, namely the Treasury, provide greater guidance on how banks, credit card companies, online donation websites and internet payment service companies can comply with the counter-terrorism law without adversely affecting legitimate aid activities.

The report also investigates the claims that UK Muslim charities are being disproportionately affected by counter-terrorism legislation, an issue that has been compounded by repeated allegations of links to extremism and terrorism in the media.

Researchers found that this may relate to UK Muslim charities’ increased exposure to risk due to the nature of their work - local connections and language skills means they are often able to gain greater access to people in dangerous conflict areas in Syria, Iraq and Gaza -, the recent poor image of Islam in the media and, in some cases insufficiently robust institutional practices which is a problem across the charity sector.

“Many UK Muslim charities sprung up quickly in response to crises such as the Syria conflict, driven by the generosity of their local communities to help. But managing such rapid growth – and ensuring that appropriate professional standards are in place – can be a challenge,” said the director of HPG Dr Sara Pantuliano.

To ensure funds are adequately safeguarded from financing terrorism, the report recommends that All UK charities ensure they have instituted adequate risk management and due diligence processes, including financial and administrative standards in line with UK charity law and the guidance provided by the Charity Commission.

There are 11,659 charities registered with the Charity Commission in England and Wales that are engaged in some form of overseas aid or famine relief.

This research was conducted with support from the Muslim Charities Forum (MCF).

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For a copy of the report ‘The impact of counter-terrorism measures on British INGOs: perceptions and reality’ or to interview Tom Keatinge or Dr Sara Pantuliano please contact ODI’s media manager Clare Price on +44 7808 791 265 or [email protected]

For interviews with the Muslim Charities Forum (MCF) representatives Omayma El Ella and Shahid Bashir please call MCF's Communications Officer Mohammad Shakir on 07708 681 014.

The Muslim Charities Forum is the umbrella organisation of Muslim NGOs with members including Islamic Relief, Muslim Aid, Muslim Hands, Human Appeal International, Human Relief Foundation, Islamic Help, Muslim Charity, READ Foundation, Orphans in Need and Al-Imdaad Foundation.