Rules Aimed at Curbing Funding for Terrorists Could Hurt Nonprofits

Small environmental groups and other nonprofits around the globe could see important funding sources dry up as the U.S. government tries to stop the diversion of charitable funds to terrorist groups. The Treasury Department, which says crooked Islamic charities are major financiers of global terrorism, has issued voluntary guidelines on international giving designed to help ensure that money doesn’t end up in the wrong hands. But those guidelines are so sweeping that they could have harsh impacts on groups that are not even remotely connected to terrorism. Some small nonprofits say they don’t have the resources to follow the guidelines on tighter record-keeping and financial oversight. Environment Tobago, a tiny group run by volunteers and one paid administrative assistant, is an example of an organization struggling to meet requests from U.S. donors for more detailed information about its shoestring finances. “If these guidelines became the de facto standard of best practices for giving abroad, we might very well have to stop making grants outside the United States,” said Eileen Growald, chair of Rockefeller Philanthropy Advisors.