This sector is vulnerable to abuse for a variety of reasons, as they enjoy public trust and have access to considerable sources of funds. Furthermore, some NGOs have a global presence that provides a framework for national and international operations and financial transaction, often within or near those areas that are most exposed to unlawful activity. Protecting this sector from abuse is both a critical component of the global fight against terrorism and unlawful activities and a necessary step to preserving their integrity and people’s confidence in them.
This sector can be misused by the donor knowingly, as an effective vehicle for money laundering, particularly at the stage of layering and integration of crime money earned through drug peddling, human trafficking, smuggling, prostitution, corruption, terrorism, extortion, kidnapping etc. Such money can be transferred as a donation to the account of any NGO, thereby giving it a legitimacy and respectability. Money laundering is no more a local phenomenon — the crime can be committed in a particular country, crime money received in another and then parked/layered and integrated to the financial system in another country.
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