SCS Azerbaijan Helps CSOs, Government, Adopt Best Practices to Prevent Money Laundering and Financing of Terrorism
FHI 360

SCS Azerbaijan’s Empowering Civil Society Organizations for Transparency (ECSOFT) project hosted an international workshop in December 2019 to disseminate best practices on preventing the abuse of CSOs in relation to money laundering and financing of terrorism.

The workshop brought together government, civil society, and international experts to discuss the role government and CSOs play in preventing the abuse and exploitation of CSOs. They also discussed Azerbaijan’s current legislation on CSO reporting obligations related to the prevention of money laundering and the financing of terrorism and how legislation can better align with the Financial Action Task Force’s (FATF) international best practices.

Speaking at the event, USAID Mission Director Dr. Jay Singh emphasized the vital role CSOs play in advancing the economy and providing essential social services. Dr. Singh noted that USAID recognizes the difficulty but also the importance of striking the right balance in order to prevent money laundering and financing of terrorism while avoiding the imposition of overly restrictive or burdensome reporting requirements on CSOs.

Workshop participant Natalia Bourjaily, Vice President of the International Center for Non-For-Profit Law (ICNL), said, “It is important to note that any effective counter-terrorism strategy must strengthen, not weaken, civil society. Imposing burdensome reporting requirements on all non-profit organizations often does not contribute to combating financing of terrorism, but instead causes ineffective spending of government resources, which otherwise could have been dedicated to fighting terrorism.”

In 2019, SCS Global partner ICNL collaborated with the European Center for Not-for-Profit Law (ECNL) to develop the Anti-Money Laundering and Counter-Terrorism Financing Laws and the Financial Action Task Force (FATF) Standards and Procedures: A Toolkit for Non-Profit Organizations. The toolkit helps non-profit organizations and CSOs understand FATF standards, procedures, and options for engagement; map relevant local laws and actors; evaluate local laws related to money laundering and terrorism financing to determine how well they comply with FATF standards; and develop advocacy strategies that anticipate and counter government arguments for restrictive policies based on inaccurate understandings of FATF standards.

"It is important to note that any effective counter-terrorism strategy must strengthen, not weaken, civil society." - Natalia Bourjaily, Vice President, ICNL