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NGOs should be accountable for financial frauds

Nowadays, opening an NGO is a lucrative business. Everyday hundreds of NGOs emerge and vanish too after collecting huge amount from the donors. Cheating common public to money laundering, there are many such scams under its belt and that too goes unreported. Raising cases of fraud by these Non Government bodies has compelled centre to cancel licences of nearly 9,000 NGOs for violation of Foreign Contribution Regulation Act (FCRA). In an order, the Home Ministry issued notices to 10,343 NGOs for not filing annual returns for the year 2009-10, 2010-11 and 2011-12. The notices were served on October 16, 2014 saying that the NGOs should file their annual returns within a month specifying amount of foreign funds received, sources of such funds, for which purpose they were received and the manner in which they were utilised. Out of the 10,344 NGOs, only 229 replied. There was no reply from the remaining NGOs leading to cancellation of their registration. For annual return, they must show their income.

In countries like India, there is always ‘ready road’ to escape before trap. Union government has taken a rightly steps by cancelling the licenses of NGOs. These organizations are safe haven for foreign funds and black money. The underprivileged people are deprived of the basic facilities during any natural calamity but these NGOs shows they spent funds on them. However, these organizations divert the funds because these funds are not accountable for their expenditure. At last, it is good that someone has asked them about accountability. It is really surprising that in a large amount NGOs never bothered to file their mandatory annual returns. The previous governments were so negligent in monitoring their activities. Perhaps, its suits their vote bank politics. There is no secret that some of these NGOs were indulging in religious conversions too. Under the banner of ‘Social Work’ many of the NGOs have spread ‘hatred’ in the country. Even, many religious leaders have made it a black marketing industry. In India, no one question religious leaders and NGOs about the donation received by them.

The Union Home Ministry suspects that many Non-Government Organisations registered under the Foreign Contribution Regulation Act (FCRA) are indulging in money laundering activities. Enforcement agencies have so far initiated investigation against 20 such NGOs. These NGOs, particularly those involved in protests against the Kudankulam nuclear power project in Tamil Nadu, received funds from abroad and allegedly diverted the donations for purposes other than their mandate based on prima facie evidence of money laundering, the MHA has referred the cases to the Central Bureau of Investigation and the State police. The cases involving foreign funds beyond Rs.1 crore have been handed over to the CBI, whereas the NGOs which received funds below Rs.1 crore are being probed by the State police. According to government records, there are about three million NGOs registered across the country. It is suspected that a bulk of them exist only on paper. A total of 45,000 organisations are registered under the FCRA after proper physical verification of their offices and bank accounts. The FCRA-registered organisations are classified into three broad categories: NGOs indulging in activities prejudicial to national interest and security; those routinely found violating FCRA norms and attracting commensurate action, including suspension or cancellation of FCRA registration; and those indulging in money laundering.

In the past few months, the MHA’s focus has been on taking action against the foreign donors which, according to the government, have been encouraging anti-development campaigns, impeding the country’s economic growth. There are about 3,000 foreign donors, and action has been taken against only 16 [by putting them on the MHA pre-approval list] for funding campaigns prejudicial to national security.

Recently, even Delhi High Court has called for toughening of licensing norms for NGOs observing that 99 per cent of them are “fraud” and “merely money making devices”. They believe that the most private run so called philanthropic organizations do not understand their social responsibilities. Only one out of hundred NGOs serve the purpose for what they are set up for. The harsh remarks came while the court was hearing a petition filed by children homes Chatravas and Arya orphanage challenging government’s refusal to grant them license under the Women and Children’s Institutions (Licensing) Act, 1956 and insisting on registration under the Juvenile Justice Act. The Delhi government and Union Women and Child Development Ministry opposed the plea saying that all children homes in the country have to be registered under the JJ Act 2006 which subject them to supervision, monitoring and periodic inspections by child welfare committee of the government, even if they have licenses under any other law. The stand of the centre was that a clear policy framework for the entire country has been laid out and Women and Children Institutions (Licensing) Act has no value as it stood repealed ever since the JJ Act came into being in 2006. But Singh said the option should be there for licensing under Women and Children’s Institutions (Licensing) Act or Orphanage and other charitable institutions Act even if the JJ Act was applicable in a state.

Dr Vaidehi Tamanhttp://www.vaidehisachin.com
Dr Vaidehi an Accredited Journalist from Maharashtra is bestowed with Honourary Doctorate in Journalism, Investigative Journalist, Editor, Ethical Hacker, Philanthropist, and Author. She is Editor-in-Chief of Newsmakers Broadcasting and Communications Pvt. Ltd. for 11 years, which features an English daily tabloid – Afternoon Voice, a Marathi web portal – Mumbai Manoos, monthly magazines like Hackers5, Beyond The News (international) and Maritime Bridges. She is also an EC Council Certified Ethical Hacker, Certified Security Analyst and is also a Licensed Penetration Tester which caters to her freelance jobs.

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