Govt Warns Nonprofits Against Misuse of Donor Funds Amid Terrorism Financing Concerns » Capital News
NAIROBI, Kenya, Dec 19—Interior Principal Secretary Raymond Omollo has cautioned non-profit organizations against the misuse of donor funds for illegal activities, including terrorism financing.
Speaking on Thursday during the launch of the 2024 Terrorism Financing Risk Assessment for Non-Profit Organizations, PS Omollo underscored the critical responsibility of NGOs to ensure donor funds are used strictly for their intended purposes.
“We are working towards strengthening our regulatory frameworks, fostering intelligence collaboration, and increasing capacity-building efforts,” Omollo said, highlighting the government’s proactive measures to safeguard the sector from financial abuse by terrorist entities.
The report, aligned with Financial Action Task Force (FATF) Recommendation 8, identifies vulnerabilities in the nonprofit sector, particularly among Faith-Based Organizations (FBOs), and proposes measures to mitigate risks. It noted that some organizations have resisted disclosing funding sources, raising transparency concerns.
As of June 2022, 3,005 NGOs registered with the Public Benefit Organizations Regulatory Authority (PBORA) reported a combined income of KSh 175.9 billion (US$1.24 billion). Extrapolated estimates suggest the sector’s total income could reach KSh 640 billion (US$4.5 billion). During the 2018/19 fiscal year, NGOs received KSh 166 billion in funding, with 88% originating from foreign sources. These organizations spent KSh 134 billion locally, representing 4.5% of Kenya’s national budget.
The assessment revealed gaps, including limited data on financial income across various NPO types, such as Community-Based Organizations (CBOs), Companies Limited by Guarantee (CLGs), trusts, and FBOs.
To address these challenges, the report recommends capacity-building initiatives, robust governance practices, and ethical leadership within NPOs to enhance transparency and foster public trust. Additionally, awareness campaigns will be undertaken to educate organizations on mitigating terrorism financing risks.
The technical group spearheading the assessment included PBORA, the Financial Reporting Centre (FRC), Muslims for Human Rights (MUHURI), and the Kenya National Civil Society Centre (KNCSC).
Oversight was provided by 14 government authorities and 13 civil society organizations, with methodological support from Greenacre Associates and technical assistance from the Global Center on Cooperative Security. The initiative was funded by the U.S. Department of State Bureau of Counterterrorism.
PS Omollo reaffirmed the government’s commitment to promoting transparency, accountability, and fairness within the sector, emphasizing that safeguarding the nonprofit sector’s contributions to national development remains a priority.
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