Foreign Ministry, CBB hold workshop on terror financing

Manama, Nov.21 (BNA): The Ministry of Foreign Affairs and the Central Bank of Bahrain, in cooperation with the GCC General-Secretariat and the US, held today a workshop on charitable donations, combating the financing of terrorism and violent extremism. Participants included the Kingdom of Bahrain, the United Arab of Emirates, Kingdom of Saudi Arabia, Sultanate of Oman, Kuwait, the United States of America, Canada, the United Kingdom, Italy, the Middle East and North Africa Financial Action Task Force (MENAFATF), World Bank, the United Nations, and the Countering Violent Extremism Community Policing (COVEXCOP) from Belgium. The workshop is an implementation of the recommendations of the Manama Declaration on Combating the Financing of Terrorism held by the Kingdom of Bahrain between the foreign affairs and finance ministries in November 2014. The meeting reaffirmed recommendations in line with the international law provisions and the UN international strategy related to combating terrorism. The workshop featured the exchange of views on the means of protecting civic organizations from the dangers of terrorism as well as the means of combating this phenomenon. It reaffirmed a number of recommendations on the importance of conducting a realistic and detailed evaluation in the non-profit organizations sector and identifying the dangers related to the exploitation of these organization in financing terrorism as well as encouraging these organizations to be part of the official financial sector to avoid the risk that pushes non-profit organizations to use other channels. It stressed not to disrupt the regulatory measures for legitimate charitable activities, which aim to promote transparency, integrity and public confidence in the management and work of all non-profit organizations, and the need for continuous communication with non-profit organizations to ensure that they improve their performance as well as raise awareness among workers in this sector on the risk of the misuse of charitable work as a cover for terrorist financing and the steps that can be taken to avoid it through awareness activities for the community in coordination with charities and non-profit organizations. It also stressed on the importance of preventive systems that aim to protect the non-profit organizations from abuse or to be used for suspicious purposes, and to enhance international cooperation to ensure the implementation of effective control over international activities of the voluntary and non-profit organizations sector, including the flow of funds, as well as to promote the exchange of information in accordance with the best practices between stakeholders and the relevant authorities. The workshop agreed that the systems should not only be punitive but that financial monitoring authorities of non-profit and voluntary organizations must be able to prosecute those organizations and their employees in the event of the violation of regulations and applicable laws such as dissolving the board of trustees, imposing financial sanctions or revoking the license in the event of non-compliance with the law. This is in addition to bolstering the implementation of procedures that impose the appropriate penalties in the event of non-compliance with the applicable regulations and laws. Non-profit organizations should also make available to the public annual financial statements audited by an auditor and exert all efforts to make sure of the identity and the status of the beneficiaries of the services, including major donors with respect to maintaining the confidentiality of such entities, as well as facilitate for the relevant authorities getting the information they need from non-profit voluntary organizations in order to create appropriate mechanisms and ensure the exchange of information about the misuse of these organizations for the purposes of the financing of terrorism with all the relevant authorities. On November 21, representatives from nine countries met in Manama, Bahrain to discuss the importance of implementing standards to prevent the exploitation of the charitable sector to finance terrorist activities, made all the more relevant given the threat posed by Daesh, foreign terrorist fighters, and other terrorist groups. Particular attention was devoted to how community-based approaches to countering violent extremism can be adapted in countering the financing of such groups. Workshop participants include practitioners representing the Kingdom of Bahrain, the UAE, Kingdom of Saudi Arabia, Sultanate of Oman, Kuwait, the GCC General-Secretariat, the United States, the United Kingdom, Italy, Canada, the World Bank, the United Nations, and the Middle East North Africa Financial Action Task Force (MENAFATF). During the event, participants reaffirmed: Commitments made at the November 2014 Manama Meeting on Combating the Financing of Terrorism (CFT), where countries promised to strengthen the international CFT regime by implementing the recommendations of the Financial Action Task Force (FATF), increasing international cooperation and the sharing of best practices, and taking proactive action to disrupt terrorist financing. Accordingly, workshop topics included discussion of appropriate implementation of FATF Recommendation 8, discussions of best practices relevant to CFT in the charitable sector, and the importance of having dialogue between non-profit organizations (NPOs) and relevant government agencies. CFT practitioners also explored government approaches to engaging communities on radicalization into violent extremism, and how such approaches may be useful in raising public awareness about CFT. The need for comprehensive action in preventing and countering violent extremism (CVE) in cooperation with both governmental and nongovernmental actors. States emphasized the effectiveness of a strategy that involves a "whole-of-society" approach in addition to a "whole-of-government." Commitment to international CVE best practices, including, but not limited to, those put forth by the United Nations, and coming out of the international CVE Summit process and the by the Global Counterterrorism Forum (GCTF). Commitment to fully and appropriately implement FATF Recommendation 8, which calls for countries to use a risk-based approach to ensure that NPOs cannot be misused by terrorists either by posing as legitimate entities, exploiting legitimate entities as conduits for terrorist financing, or concealing diversion of funds intended for legitimate purposes. Practitioners discussed how to protect NPOs from such abuse by implementing appropriate mitigation measures that are commensurate with the terrorist financing risks identified and in line with the risk-based approach, given that FATF has clarified that Recommendation 8 do not apply to the NPO sector as a whole. The assertion that regulatory measures, such as those implemented by central banks, should promote transparency, integrity and public confidence, not disrupt or discourage legitimate charitable activities. And the recognition of the importance of charitable and humanitarian services to provide assistance to people in need all around the world. The idea that by sharing good practices and lessons learned in the development of risk-based approaches, effective, targeted and proportionate financial investigative techniques to address specific TF threats, and engagement with the non-profit sector and community leaders, the workshop fulfilled the 2014 Manama Meeting’s call for multilateral initiatives that contribute to the strengthening of the global CFT regime. Commitment to building a healthy charitable sector that not only promotes good giving, but also protects against exploitation by terrorist groups, and engages NPOs and community leaders to raise public awareness about the importance of legitimate charitable contributions and solicit their feedback in working together to protect the non-profit sector from abuse.