Delayed action on NGO funding
Posted on November 11th, 2024
Sugath Kulatunga
Thursday, November 7, 2024, ECONOMYNEXT reports that – Sri Lanka’s Central Bank signed an agreement to obtain and exchange information on investigations and prosecutions of Money Laundering (ML), Terrorist Financing (TF) and related crimes in Non-Governmental Organizations (NGO) and of any persons connected with such bodies.
The Central Bank’s Financial Intelligence Unit (FIU) and the National Secretariat for NGOs entered into the Memorandum of Understanding (MOU) on Monday (04) with this regard, the Central Bank said.
Non-Governmental Organizations (NGOs) could be misused for Money Laundering/Terrorism Financing and related crimes, and thereby could threaten the stability of the national and global economic and financial systems,” the Central Bank said in a statement.”
This is too late as usual and too limited in scope. Why did not Sri Lanka follow the Foreign Contribution (Regulation) Act of India and ensure that foreign donations are used in a way that is consistent with national interests and the values of a democratic republic” Was it because political parties and pro-west NGOs were dependent on foreign funding?
Indian law has existed since 1976 and was revised in 2010 to meet new developments. The government and the CBSL should be ashamed of their inaction. A summary of the Indian law is given below.
The Foreign Contribution (Regulation) Act (FCRA) is a law in India that regulates the flow of foreign funding into the country. The FCRA was originally enacted in 1976 and significantly revised in 2010. The FCRA’s purpose is to ensure that foreign donations are used in a way that is consistent with national interests and the values of a democratic republic.
The FCRA requires that:
- All NGOs register with the Ministry of Home Affairs (MHA)
- Individuals or NGOs seeking to receive foreign donations must be registered with the MHA
- Individuals or NGOs seeking to receive foreign donations must be structured as a Trust, Society, or Section 8 Company
- Entities must obtain prior approval or registration from the MHA to receive foreign contributions
- Entities must adhere to various reporting requirements
The FCRA also prohibits the acceptance of foreign contributions for activities that are detrimental to the national interest.”