Consortium Against Terrorist Finance Jan. 12, 2017, 1:00pm

The close of 2016 brought a scary realization for charities in the United Kingdom: terrorist actors continue to target and abuse them to further their own sinister agendas. The Charity Commission, a UK government department that regulates charity activities throughout England and Wales, has recorded nearly triple the reports to law enforcement of extremist and terrorist links since its 2013-2014 assessment. The Commission published its most recent corporate report titled “Tackling Abuse and Mismanagement in Charities: 2015-16” on December 20, 2016, that examined the growing cases of charity exploitation over the past year. When interviewed by The Telegraph, Commission Chairman William Shawcross stated that for charities, “the threat of Islamist extremism […] is not the most constant threat – it is the most potentially deadly threat”, and in his Foreword of the report, urged the importance of rectifying the “poor governance” that ultimately exposes charities to these threats.

The crux of the December 20th report identified financial crime abuse, safeguarding issues and – arguably most important – abuse of charities for terrorist related purposes, as the three principal risks facing charities today, and it beseeched charity trustees to serve as better risk mitigation gatekeepers. With respect to abuse of charities by terrorist actors, the Commission detailed a few key considerations. First, it reiterated the importance of continuing to operate from a “risk-based” approach, focusing attention and resources on the charities with the greatest vulnerability, since not all organizations confront the same level of risk. The primary factors that comprise this level of exposure were catalogued as “[cash, online and social media] fundraising methods, movement of cash, goods and people, diversion of aid internationally, abuse or misuse of charitable assets […] and misuse of a charity’s name, premises and resources to promote and facilitate extremist speakers and views”. The Commission also pointed out that, while charities within the UK are certainly not immune to the threat, charities operating in “conflict zones” – Syria, for example – have the greatest inherent vulnerability, as terrorist groups thrive on the weaknesses of these areas.

One particularly interesting example that personifies the Commission’s cause for concern of growing charity exploitation is the early 2016 case of Cage, a human rights group led by former Guantanamo Bay detainee Moazzam Beg, that had been receiving charitable donations from the well-known Joseph Rowntree Charitable Trust and The Roddick Foundation to the tune of half a million U.S. dollars total. Unbeknownst to these two organizations, Cage had been holding meetings at various universities to propagandize anti-government rhetoric and rouse students to “sabotage” the Prevent Duty program, a UK directive that applies to charities, among many other authorities, and requires “due regard to the need to prevent people from being drawn into terrorism”. Cage also purportedly had continuous close contact with Mohammed Emwazi, notoriously known as ISIS executioner “Jihadi John”, and upon his death in November 2015, a Cage research director remembered him fondly during a press conference.

Time and time again, the Commission has warned of the increasing abuse of charities by terrorist entities, and just a week prior to the release of the December 20th report, the Commission publicly issued a regulatory alert about charities at risk of cyber attack to notify charities of two recent phishing email scams. In October 2015, the UK assessed the risks posed to charities of terrorist abuse as medium-high in its National Risk Assessment. The December 20th report leads to the realization that over the past two years there has been an average of two police reports about extremist links to charities per day. In 2015-2016 alone, the Commission opened 21 reports of a “serious incident”, four new inquiries and eight operational compliance cases that contained allegations of terrorist abuse of charities.

As far as next steps, Commission Chairman Shawcross stated in an interview with The Telegraph  that he aspires to create a “whistleblowers' hotline”, similar to fundraising call centers utilized by charities themselves, to incentivize reporting and enhance information sharing amongst trustees following these types of incidents. As one of Shawcross’ final leadership initiatives, he is currently devising plans for the hotline and envisions having the charities themselves fund it through a new tax. The necessity of staying creative and evolving alongside the threat is becoming all too evident in efforts to slow the growing rate of terrorist exploitation of charities.

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