Ten years ago, the Charity & Security Network opened its office and launched a campaign to address serious problems that post-9/11 laws and enforcement actions created for charities, especially those that serve people in parts of the world plagued by conflict and humanitarian crises.
The network’s founders represented diverse stakeholders in the U.S. nonprofit sector, including grantmakers, international NGOs, civil liberties groups and legal experts. They had been working together since passage of the PATRIOT ACT in 2001 to push back against ill-informed and hostile U.S. government action that shut down charities without adequate due process and froze millions of dollars in donations that could have been used to save lives and relieve human suffering. With a new administration taking office, we believed there was an opening for the collective voice of the nonprofit sector to be heard, and for new approaches that would respect both charity and security to be taken. With initial support from the Open Society Foundations, a staff of two, including myself and Suraj Sazawal, came on board to provide support for this effort.
While there have been no quick fixes, C&SN, through the coordinated work of its members, has made substantial progress in the past ten years, despite headwinds that are putting pressure on civil society space and weakening respect for international humanitarian law globally. Engagement with government has been productive. This might be best reflected by Treasury’s recent update to its National Terrorist Financing Risk Assessment, which acknowledges that the nonprofit sector as a whole is not a high terrorist financing risk and that “self-regulation initiatives within the charitable sector” have been a factor in reduced risk of terrorist financing abuse of U.S. charities.”
Reflecting on the past should help us to think about the future and the direction C&SN takes for the next ten years. We encourage you to share those thoughts with us as we move through 2019.
Below is a history of our work and accomplishments.
The Charity & Security Network (C&SN) opened its doors in January 2009 with Kay Guinane serving as Director. The Open Society Foundation provided initial funding and OMB Watch served as project sponsor. The website was launched a few months later. C&SN continues to serve as a resource for civil society members – educating stakeholders and the public about humanitarian law, counterterrorism restraints and the varying impacts on U.S. nonprofit organizations (NPOs). It began its work by tackling the limitations placed on charitable giving and program operations by U.S. national security rules after passage of the PATRIOT Act in 2001. For example, on July 2, C&SN sent a letter to President Obama, co-signed by a diverse group of 16 other NPOs, including faith-based charities, civil liberties groups and grantmakers. This letter called for new rules to govern charitable giving and protect the essential work of humanitarian organizations in conflict zones, recognizing the important support NGOs give to reduce the roots of terrorism, including “the hopelessness of poverty, anger at injustice, and frustration at being shut out of the political process”.
In tandem, C&SN hosted an event on July 1, 2009, with a panel discussion titled, “Dilemma for U.S. NGOs: Counterterrorism Laws vs. the Humanitarian Imperative.” The panelists, including civil society leaders from the Global Emergency Group, the ACLU, Life for Relief & Development, the Homeland Security Policy Institute and defense counsel for Hamdan v. Rumsfeld, joined C&SN’s director, Kay Guinane, to discuss the tensions between U.S. counterterrorism laws and widely accepted international standards for aid and development.
During the year, C&SN facilitated discussions among NPOs on how U.S. counterterrorism rules should change in order to address the chilling impact on charitable programs. The specific proposals generated through this process served as the basis for advocacy going forward.
C&SN’s inaugural year concluded with the publishing of its report, How the Work of Charities Can Counter Terror and How U.S. Laws Get in the Way in December. This issue gathered testimonies from representations of the U.S. nonprofit sector and international civil society leaders from Colombia, the Palestinian States and the Philippines. The report was based on a March 20, 2009 panel discussion sponsored by the C&SN and Cordaid, which addressed the need to acknowledge the critical role nonprofits play in improving security by alleviating suffering and promoting human rights in global hotspots.
The Charity & Security Network commenced a new decade by hosting the U.S. launch of Civil Society under Strain: Counter-Terrorism Policy, Civil Society and Aid Post-9/11 (Kumarian Press). C&SN’s Kay Guinane and Suraj K. Sazawal co-authored the chapter, “Counter-Terrorism Measures and the NGO Section in the United States: A Hostile Environment.” This book was the first comprehensive examination of the restrictive and punitive impact from counterterrorism legislation on NPOs since 9/11, and C&SN’s contributing chapter, focusing on the U.S., included a four-part analysis of the legal counterterrorism regime, the tensions between U.S. security policy and international law, the impact on domestic NPOs and the political context. The chapter concluded with strong repudiation of the myth that charities are a significant source of terrorist financing.
On May 26, 2010, Kay Guinane testified in the first Congressional oversight hearing since 9/11 to look at the impact of anti-terrorist financing enforcement policies on the U.S. charitable sector. The hearing, Anti-Money Laundering: Blocking Terrorist Financing and Its Impact on Lawful Charities, was held by the House Financial Services subcommittee on Oversight and Investigations and included testimony from members of the Treasury Department, the ACLU and the Washington Institute for Near East Policy. At the hearing, a Treasury official acknowledged that the laws aimed at stopping terrorist financing have hurt charitable programs. Kay outlined specific problems faced by the U.S. nonprofit sector, including the freezing of bank accounts indefinitely, stating, “the impact of U.S. Treasury enforcement on legitimate charitable organizations has largely been negative.”
C&SN continued its series of informative events throughout 2010, including a Roundtable Discussion on Zakat Committees in the West Bank, and a briefing on the Supreme Court case Holder v. Humanitarian Law Project. This case centered on whether the NPO, Humanitarian Law Project, had violated criminal law when they sought to train two organizations designated as Foreign Terrorist Organizations by the Department of State on the United Nations conflict resolution process and other nonviolent dispute resolution. Criminal statute 18 U.S.C. 2339B prohibits “knowingly providing material support or resources to a foreign terrorist organization.” The definition of “material support or resources” in this statute encompasses many different types of activities. At issue in this case is the prohibition of providing “training,” “services,” “expert advice or assistance,” and “personnel.” The court rejected HLP’s claims that the law was impermissibly vague in violation of the Fifth Amendment Due Process Clause or that it violated HLP’s First Amendment right to free speech and association. Over the course of this litigation, C&SN stepped up its advocacy, including coordinating NPO response to court decisions, such as a press briefing with legal experts; publishing summaries, blogs, and creating a Peacebuilding Working Group to work on ways to fix the problems the decision created.
As the 111th Congress drew to a close in December 2010, two bills were introduced that address critical fairness issues for U.S. charities in the context of national security law. One, filed on Dec. 16 by Rep. Keith Ellison (D-MN), would have created due process for U.S. charities accused of supporting terrorism. The other, filed on Dec. 20 by Sen. Benjamin Cardin (D-MD), would have addressed procedures for dealing with classified information in federal criminal proceedings. In 2011, the Charity & Security Network continued to visit the Hill to advocate for these reforms that would enable access to due process for charities.
In May 2011, C&SN joined a bipartisan group of 18 organizations and 27 foreign policy and peacebuilding experts in sending a letter to Secretary of State Hillary Clinton calling on her to exempt conflict resolution programs and other activities aimed at ending violence from the ban on material support of terrorism. The letter noted that, “For many years, U.S. organizations and private individuals have paved the way for peace by helping to bring fighting factions together and providing alternatives to violence as a means of redressing grievances. We know that these initiatives can be the key to success in resolving conflicts.”
It also noted that although the Supreme Court upheld the constitutionality of the ban on material support in June 2010 in Holder v. Humanitarian Law Project, “the court held that the law may impose such restrictions, not that it must.”
On June 21, 2011 C&SN sponsored a forum at the National Press Club featuring Ambassador Soderberg and a panel of U.S. NPO experts calling on the Obama Administration and Congress to remedy the negative effects of counterproductive security measures on peacebuilding activities and charities and donors. The event, “The Humanitarian Law Project Decision: Problems for Peacebuilding, Aid, and Free Speech One Year Later,” focused on the overbroad application of the “material support” of terrorism laws that create restrictions on humanitarian aid delivery, First Amendment rights and criminalizes peacebuilding efforts aimed at turning terrorist groups away from violence.
A major issue in 2011 was the tragic famine in Somalia, where counterterrorism restrictions stopped NPOs from providing much needed humanitarian assistance to al Shabab-controlled regions of Somalia. C&SN advocacy included articles, briefings, and continuing dialogue with Treasury. C&SN’s efforts within the NPO sector led Sen. Patrick Leahy to call on the State Department and Attorney General to work with the sector on clear guidance that would permit humanitarian access.
In December 2011, C&SN published a comprehensive study of counterterrorism policies and their impact on U.S. civil society in U.S. Muslim Charities and The War on Terror: A Decade in Review. The report included testimony from U.S. Muslim charities and C&SN partners, condemning the growing pressures on civil society across the U.S. since 9/11. In particular, the report highlighted the decline in donations to overseas humanitarian assistance as a result of U.S. security barriers. It found that there were far fewer organizations making donations to Somalia in the wake of the shutdowns, which was causing a trend away from international to domestic giving, even many of the neediest recipients reside overseas.
In response to the September 2011 announcement that United States Agency for International Development (USAID) was planning a pilot Partner Vetting System (PVS) program, C&SN joined numerous NGO partners in opposing this proposal. On February 17, a group of American aid workers and NPOs filed with State Department their arguments against PVS, including the warning that this system would drastically increase the dangers aid workers face abroad.
In addition to a full calendar of events, C&SN also published two reports in 2012. The first, Deadly Combination: Disaster, Conflict and the U.S. Material Support Law, was published in April. This study looked at two devastating humanitarian crises, the 2011 famine in Somalia and the summer 2010 floods in Pakistan, and evaluated the politicization of U.S. security policy as barrier to international humanitarian aid. The study condemned U.S. government policy as “at best, a ‘wink and nod’ gesture that allows for limited access for humanitarian groups (and no legal protections) and, at worst, a blanket ban on any humanitarian operation.”
In June, C&SN released Safeguarding Humanitarianism in Armed Conflict: A Call for Reconciling International Legal Obligations and Counterterrorism Measures in the United States. After a review of U.S. counterterrorism laws impacting charities, the report explained the legal framework of international humanitarian law (IHL), focusing on provisions that address civilian relief operations during situations of armed conflict. It then analyzed how current U.S. counterterrorism laws and enforcement policies, particularly the broad prohibition on material support to terrorism, do not adequately incorporate these provisions and are inconsistent with humanitarian principles and obligations. The report urged the U.S. to work with the NPO sector to better incorporate international humanitarian law principles and concepts into U.S. law and enforcement policy. On July 26, C&SN hosted a Capitol Hill briefing, using examples from this report, and featuring a panel of experts.
Following publication of a report on how FATF’s R8 contributes to shrinking civil society space, C&SN joined with allies in Europe to begin advocacy aimed at addressing this problem. C&SN became a founding member of the Global NPO Coalition on FATF. This coalition was set up to ensure that civil society is effectively engaged in the debate on anti-money laundering and counter-terrorism financing. Its vision is to have a free and fully enabled operating space for civil society.
An important facet of the Charity & Security Network’s advocacy has been to increase dialogue with and to put pressure on the Financial Action Task Force (FATF) with regard to their Recommendation 8m which pertains specifically to NPOs. It calls on countries to “review the adequacy of laws and regulations that relate to NPOs which the country has identified as being particularly vulnerable to terrorist financing abuse.” The identification of the nonprofit sector as “particularly vulnerable” to terrorist abuse created undue stigmatization of the nonprofit sector, causing increased risk-averse behavior from potential donors and bank derisking practices. On April 24 2013, FATF convened a consultation and dialog with 20 civil society representatives from around the world in London. C&SN participated. This event was the first time the intergovernmental financial body formally met with NPOs to discuss its standards for governments’ anti-terrorist financing rules for NPOs and the need to protect NPOs from both abuse by terrorists and the adverse impacts of poor governmental implementation of FATF’s R8. After the meeting, FATF issued a statement saying it “will continue working on this issue.”
In June 2013, three years following the Holder v Humanitarian Law Project ruling, C&SN joined a distinguished groupof former ambassadors, foreign policy experts and peacebuilders – including former President Jimmy Carter – in signing a petition that was sent to Secretary of State John F. Kerry asking that he exempt peacebuilding activities from the ban on engagement with groups on the terrorist list.
At the end of the calendar year, C&SN joined a 24 U.S. NPOs suing the National Security Agency (First Unitarian Church of Los Angeles v. NSA). The suit challenged the legality of the NSA’s bulk collection of phone call information as an impediment to citizens’ freedom of association.
In 2013, bipartisan legislation was introduced in the U.S. House of Representatives that would have removed barriers to providing aid and promoting peace created by U.S. counterterrorism policy. C&SN was proud to support this bill along with more than 60 prominent civil society organizations, including the American Red Cross, Care USA, Oxfam America, and World Vision. The Humanitarian Assistance and Facilitation Act (HAFA), introduced by Rep. Chris Smith (R-NJ) and co-sponsored by Reps. James McGovern (D-MA), Jeff Fortenberry (R-NE) and Randy Weber (R-TX), did not pass but became the basis of the Humanitarian Assistance and Peacebuilding Protection Act (HAPPA) of 2015.
In February, C&SN submitted extensive findings on behalf of the Global NPO Coalition on FATF to the Financial Action Task Force for its 2014 typology report, Risk of Terrorist Abuse in Non-Profit Organizations. Following the publication of the report, the coalition sent a letter to FATF stating that it was pleased that several of its recommendations were included in the report, including references to the positive role that civil society plays in increasing human security worldwide and the special protections given to the sector under international human rights law and international humanitarian law. At the same time, it expressed concerns over limited data and its emphasis on a preventative approach. The Coalition’s concern that use of administrative sanctions could be used to impose excessive levels of regulation and government control of the NPO sector remained unanswered.
On September 15, the C&SN submitted a list of recommendations to the UN Human Rights Commission as part of HRC’s Universal Periodic Review process. This list recommended that the U.S. takes steps to make counterterrorism rules for NPOs consistent with international human rights standards. The filing was joined by a group of 11 civil society groups and experts.
C&SN continued to push for adequate humanitarian access to civilian populations, supporting the Humanitarian Assistance Facilitation Act (HAFA). It noted shortcomings in Treasury’s limited guidance for humanitarian groups in an October 2014 news release, entitled calling for stronger administration policy to facilitate U.S. nonprofits’ ability to work in global hotspots.
C&SN launched its Financial Access Working Group to advocate for solutions to problems NPOs with international programs experience with banking services, including account closures and long delays for transfers.
Charity & Security Network celebrated sizeable victories for civil society during 2015. First, the Financial Action Task Force’s June 2015 update of its Best Practices Paper incorporated almost all of the changes requested by the NPO sector. The update advocated for a new emphasis on a risk-based approach to counterterrorism financing regulation and specifically mentioned freedom of association, assembly and expression. In response, C&SN members renewed their advocacy with banks and U.S. Treasury for greater financial access.
In response, U.S. Treasury published the first National Terrorist Financing Risk Assessment on June 12. Its study found that abuse of the charitable sector tended to occur outside of any charitable organization recognized by the U.S. government. This acknowledgment was welcomed by C&SN, however Treasury’s report also lacked further evidence. Treasury did not conduct public outreach to solicit input or comments despite guidance from FATF encouraging it to engage all relevant stakeholders, including the NPO sector. More work was needed in the U.S. in order for FATF’s revised approach to be fully incorporated, and this message was reflected in a detailed memo submitted to FATF by C&SN in partnership with the Council on Foundations on July 6.
In January, Charity & Security Network joined more than 120 NPOs from 46 countries in asking FATF to revise its Recommendation 8 on nonprofits, citing changes already made to the standard’s Best Practices Paper.
On February 25, CSN led a group of 58 NPOs from around the world, including umbrella groups with more than 300 member organizations, to send a letter asking the U.S. Departments of Treasury and State to convene a multi-stakeholder dialogue as part of a broader effort to ensure that registered, law-abiding NPOs are able to access the global financial system. The letter condemned bank derisking practices and warned of the increasing humanitarian risk at stake if NPOs continued to be shut out of the U.S. banking system.
During the year, C&SN conducted extensive research on financial access issues, including the first scientific-sample survey on NPOs to determine the scope of the problem.
In June, C&SN and its partners celebrated the revision of Recommendation 8 by the FATF. Echoing the changes made to the Best Practices Paper in 2015, the FATF’s revision of R8, including the removal of language that identified the NPO sector as “particularly vulnerable”, set a new standard for a “risk-based approach.” This news marked a significant victory for the NPO sector.
In December, following a thorough review in 2015, the FATF released the results of its Mutual Evaluation of the United States on December 1st. This report assessed the U.S. compliance with FATF’s 40 anti-terrorist financing and anti-money laundering standards, including Recommendation 8. FATF’s recognition that the U.S. anti-terrorist financing rules are “strict liability” was helpful, but the report did not have any discussion of how such “zero tolerance” rules were inconsistent with the FATF’s suggested risk-based approach. Since this report, C&SN has continued alongside its coalition partners to put pressure on the FATF and the U.S. for the sake of protecting NPOs’ financial access.
In 2017, Charity & Security Network made the campaign for NPO financial access and against bank derisking a key priority. In February, C&SN published Financial Access for U.S. Nonprofits, which provided the first empirical data showing just how serious a problem “derisking” for NPOs in the U.S. has become. The report found that two-thirds of U.S. charities operating internationally have experienced problems with banking services, affecting all types of programs in all parts of the world. The study also included analysis from interviews with banks, government officials and NPOs that demonstrates the need for greater clarity from regulators. Its recommendations included formation of a multi-stakeholder dialogue aimed at forging solutions. As part of its outreach, C&SN staff spoke on this issue at a conference at The Hague in October and the World Humanitarian Action Forum in London in November, and Kay appeared in a documentary film on the issue produced by the Women’s Peacemakers Program. In December, C&SN’s Andrea Hall testified before the InterAmerican Commission on Human Rights, using evidence from the Financial Access Report.
The early 2017 launch of the World Bank and ACAMS (Association of Certified Anti-Money Laundering Specialists) dialogue, in which government officials, banks and NPOs agreed to work toward financial access solutions, led to further coalition advocacy. C&SN coordinated NPO participation in drafting a joint NPO-bank proposal to revise the U.S. Bank Examination Manual section on NPOs. Submitted to U.S. regulators in the fall, the revision provided updates to the manual which would reflect the Financial Action Task Force’s 2016 changes to its Recommendation 8 on NPOs.
In the spring, C&SN partnered with CIVICUS as its North American research partner for the CIVICUS Monitor, reporting on civil society developments in the U.S., Canada, Mexico and Cuba. The Monitor is a real-time portal of country-specific information on the freedoms of expression, peaceful assembly and association around the world.
In October, C&SN led a group of 50 civil society organizations signing a statement in support and recognition of U.S. NPOs and their vital role in supporting communities and protecting democracy. The statement called on the U.S. government to protect and respect the work of NPOs; to recognize that many engage in activities that contribute to the security of individuals and institutions across the globe; and to recognize that many have an ability to carry out programs that promote peace and human rights, alleviate poverty, aid civilians in areas of disaster and armed conflict, and build democratic governance.
C&SN launched the “Know Your Rights” Campaign towards the end of this year, with a series of webinars and online information tools to answer the pressing concerns for NPOs facing government investigations, derisking and more.
This year, the Charity & Security Network stepped up its advocacy and pushback against the growing Islamophobia within the current U.S. administration.
In early May, as a follow-up to the November 2017 World Humanitarian Action Forum in London, C&SN sponsored an event on bank derisking of nonprofits at CSIS as the U.S. launch of a series of reports published by The Humanitarian Forum, Overseas Development Institute and London School of Economics. The event was followed by a series of high-level meetings at U.S. Treasury, the Department of State and congressional offices describing the research.
C&SN participated in a June 26 congressional hearing titled “International and Domestic Implications of De-risking,”held by the subcommittee on Financial Institutions and Consumer Credit of the House Financial Services Committee. Sue Eckert, the lead author on C&SN’s 2017 report on Financial Access for U.S. Nonprofits, testified at the hearing where she focused her evidence on the C&SN report’s findings. This hearing and the other testimonies indicated a growing congressional awareness of derisking.
At the same time, a July 11 hearing in the National Security Committee of the House Oversight and Government Reform Committee reminded C&SN of the work still needed in order to pushback against misinformation. In response to misleading testimony, Kay sent a letter to the committee on August 14, saying such statements “inaccurately and unfairly portray the U.S. charitable sector as a source of terrorist financing. Such statements undermine the important work U.S. NPOs do around the world and fail to recognize the high levels of transparency, oversight and good governance they employ.”
Upon learning that Treasury planned to update its 2015 National Terrorist Financing Risk Assessment, C&SN submitted suggested changes to the agency. The comments recommended a methodology for assessing risk to the NPO sector based on the revised FATF Recommendation 8 and guidance. Treasury’s updated Risk Assessment was published in late December.
In the spring, C&SN learned of several lawsuits filed in U.S. courts against NPOs that receive USAID funding. Lawyers with an anti-Muslim agenda have been using a whistleblower provision in a U.S. anti-fraud law, asserting spurious allegations, to penalize organizations seeking to provide life-saving resources to individuals in the West Bank and Gaza. These suits have fueled a sense of insecurity and uncertainty for NPOs operating under USAID grant partnerships. In response, C&SN has doubled down on its efforts to support the civil society sector – partnering with other NPOs, releasing information briefs, hosting webinars and publicly condemning this witch hunt.
Also in 2018, C&SN supported two bills that received bipartisan support in Congress. The Global Fragility and Violence Reduction Act, promoted by a broad coalition of peacebuilders, passed the U.S. House of Representatives in the fall. The Elie Wiesel Genocide and Atrocities Prevention Act, coordinated by Friends Committee on National Legislation, passed Congress in late 2018 and was signed into law in early 2019. We remain committed to protecting the work of its humanitarian NGO and civil society partners.