Charities and terrorism offences – staying on the right side of the law

Insight

08.02.2016

When the draft Protection of Charities Bill was being considered, a number of humanitarian charities expressed concern that terrorism offences had been added to the list of crimes that would lead to automatic disqualification from trusteeship. These charities explained that it can be difficult for them to work in certain countries without co-operating with proscribed groups that wield local power, and that fear of committing terrorism offences has a chilling effect on their work in those regions. They asked if the Government would consider amending terrorism legislation to exempt humanitarian NGOs, pointing out that similar exemptions exist in other countries.

The Government refused, arguing that this would create a loophole that could be exploited by unscrupulous individuals. However, it agreed that it would be helpful for NGOs to be helped to understand how to comply with the law. Recently, the Charity Commission and the Home Office have both published guidance on anti-terrorism legislation.

Charity Commission: Terrorism Act alert

This alert explains the duty of trustees to report certain offences. It was prompted by a small number of cases in which charitable assets were lost to proscribed organisations overseas.

Section 19 of the Terrorism Act 2000 obliges a person who, during the course of their employment, comes across information leading them to believe or suspect that a terrorist financing offence has been committed, to disclose the information to a "constable" as soon as possible. The Commission notes that this duty can be fulfilled by contacting the National Crime Agency or the police. Links to the NCA and the Metropolitan Police Anti-Terrorism hotline are provided.

Where a s.19 report is made, the Commission expects the charity also to file a serious incident report.

It is an offence to fail to make a report (though the statute lists a number of defences). The alert explains that delay in making a report can constitute an offence and that this has occurred in one charity's case, though the police decided against prosecution.

The Commission advises charities:

to report beliefs/suspicions to a "constable" as soon as possible, to ensure compliance with s.19;
to make a serious incident report at the same time;
to ensure that their policies reflect their s.19 duties;
to make sure that staff are aware of their legal duties in this area;
in the case of charities operating overseas, to put mechanisms in place so that offices in other countries, their staff, agents and other partners report any relevant beliefs or suspicions promptly.

Home Office note: operating within counter-terrorism legislation

This was published in November 2015 and can be read online here. It begins by pointing out that NGOs operating in high-threat areas are responsible for complying with UK law and for taking steps to reduce the risk of non-compliance, but states that the risk of prosecution for humanitarian work is low (with no known recent convictions) and outlines the steps leading to prosecution. These include the Crown Prosecution Service concluding that prosecution will be in the public interest and, in the case of many terrorism-related offences committed overseas, obtaining the Attorney General's consent to prosecution. The aim of listing the steps – and discussing the Code used by the CPS to decide whether or not to pursue prosecution – is to reinforce the message that the risk for international NGOs is not high.

The Guidance restates the Government's opposition to relaxing counter-terrorism laws for NGOs, noting the Government's view that not only could this create a loophole, it could leave NGOs vulnerable to abuse.

In a short paragraph on how NGOs can reduce the risk that their staff will be prosecuted, the Home Office mentions the chapter of the Charity Commission's compliance toolkit on charities and terrorism and guidance produced by the Disasters and Emergency Committee and the Humanitarian Practice Network.

The next section of the note outlines the law on asset-freezing and proscribed organisations, describing what NGOs can and cannot do within the law. There are links to the lists of individuals and organisations whose assets have been frozen, and of proscribed organisations. It explains that whilst it is possible to obtain a licence to transfer funds to those whose assets have been frozen, it is unusual for the Treasury to issue licences for payments overseas, noting that "this has only been done where HM Treasury has been able to satisfy itself that the risk of the funds being used for terrorism can be mitigated".

On the question of whether NGOs can meet with proscribed organisations when working abroad, the guidance states that the offences only apply to meetings in this country and "do not prevent non-governmental organisations interacting with proscribed organisations overseas although, of course, we would encourage compliance with the Charity Commission’s guidance on conduct…"

The Guidance ends by discussing the worry that some organisations have about losing access to financial services, acknowledging that some NGOs have had their banking services restricted or withdrawn. It describes some of the steps taken by the Financial Conduct Authority and the Financial Action Task Force to help financial institutions understand their position, but adds that neither the Government nor regulators can force banks or other institutions to provide services and suggests that organisations experiencing problems contact their banks directly.

This article does not describe everything covered in the guidance produced by the Home Office and the Charity Commission. If you have concerns about your charity's risk of falling foul of counter-terrorism legislation, please read the guidance in full or contact us for bespoke advice.

If you require further information on anything covered in this briefing please contact James Maloney ([email protected]; 020 3375 7114), Rachel Holmes ([email protected]; 020 3375 7561) or your usual contact at the firm on 020 3375 7000.

This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.