AML/ATF Update
Aug 2021 Charity & NFP Law Update
Published on August 26, 2021

By Terrance S. Carter, Nancy E. Claridge and Sean S. Carter

   
 

Bank De-Risking Frustrates Humanitarian Aid for Countries in Need

Denial of financial services to non-profit organizations and charities to avoid the potential risk of terrorist financing or money laundering has an adverse impact on human rights, according to a recent report by a New York University legal clinic in Paris. “Bank De-Risking of Non-Profit Clients: A Business and Human Rights Perspective” was published by the NYU Paris EU Public Interest Clinic in cooperation with Human Security Collective, ABN AMRO and Dentons Netherlands, on June 1, 2021. The 27-page report offers new data and insight into the human rights consequences of the banking practice of de-risking non-profit organizations (“NPOs”), which includes charitable and not-for-profit organizations (the “Report”). At the same time, the Financial Action Task Force (“FATF”) has also recognized that financial institutions engaging in “de-risking” may have an adverse impact on charities and not-for-profits, and has launched a project to study, in part, de-risking and the undue-targeting of NPOs. This Alert provides a brief summary of the Report and discusses the impact of de-risking on the charitable and not-for-profit sector.

For the balance of this Alert, please see AML/ATF and Charity Law Alert No. 49.

   
 

Read the August 2021 Charity & NFP Law Update