Fighting Fraud and Corruption in the Humanitarian and Global Development Sector
There are an estimated 40,000 international Non-Government Organisations (NGOs), working in an enormous global aid industry; official development assistance alone reached £90bn in 2014. This is supplemented by huge voluntary giving – the UK public, for example, give around £1bn a year to overseas causes.
These organisations face a unique challenge from fraud and corruption. Operating in the world’s most under-developed and fragile environments, with minimal infrastructure and trust-based cultures, the risk is high. And, being wholly reliant on donors and supporters for income, so are the stakes.
Researchers make different estimates of the scale of the problem facing the sector. Some research implies that losses to the global aid budget caused by occupational fraud and abuse may be in the billions of pounds, while those to the British public’s voluntary overseas donations could be in the tens of millions. For many sector professionals working in the developing world, these estimates are readily believable.
Fighting Fraud and Corruption in the Humanitarian and Global Development Sector is a timely, accessible and relevant how-to guide, which explores the scale and nature of the threat, debunks pervasive myths, and shows readers – whether they are NGO staff, trustees or supporters – how to help their NGOs to better deter, prevent, detect and respond to fraud and corruption.
Terrorist Diversion: A Guide to Prevention and Detection for NGOs
Oliver May and Paul Curwell
Many of the world’s 40,000 international NGOs work in places where terrorist financing, sanctions breaches and diversion to armed actors are key risks. Almost all of the top ten recipient countries of humanitarian aid alone in 2015 were high-risk jurisdictions, for example, receiving more than £7bn between them. When they feel safe to speak, sector workers share sobering stories about what might have happened to some of this money.
As international NGOs struggle to keep up with worsening humanitarian crises and intensifying global development needs, the management of diversion risks and their complexity remains daunting. The demands of internal stakeholders, donors, banks and regulators are diverse and even contradictory. Public scrutiny has magnified, but is not always well-informed. Institutional donors transfer ever more risk to implementing partners, while some banks seek to avoid this risky business altogether, pushing some NGOs outside the global banking system.
Looming over all these converging pressures is a latticework of austere international sanctions and Counter-Terrorism Financing (CTF) regimes. It is no surprise that international NGOs find themselves struggling to reconcile this complex set of expectations with their charitable missions.
Yet the consequences of failing to do so can be severe. Future funding is contingent on reputation, and serious offences litter the regulatory landscape. The implications of breaches can be existential for organisations, and criminal for individuals.
Terrorist Diversion: A Guide to Prevention and Detection for NGOs is an accessible, pragmatic guide for international NGOs of all shapes and sizes. Clearly explaining the nature of the challenge, and setting out a program to meet it, we show international NGOs how it is possible to manage these risks more effectively through their missions – not in spite of them.
Out 2019/2020 with Routledge.