The recent actions against non-government organizations (NGOs) by the Kenyan government reflects the necessity of implementing some protective measures in combating the use of NGO’s as a conduit for illicit financial flows (IFFs). In Kenya, the NGO Coordination Board is tasked with the difficult mission of finding and closing NGOs utilized for the finance of criminal and terrorist activities. This mission has been executed with more blunt force than precise control. The decision in 2013 to revoke the registration of more than 500 organizations, of which only fifteen were suspected of money laundering, demonstrates how the broad pursuit of terrorist funding can quickly impinge upon democratic freedoms. While the Kenya’s Ministry of Devolution’s cabinet secretary succeeded in directing the NGO board to reverse the decision that would revoke the registration of an additional 1000 NGO’s, Kenya serves as a marked example of the need to systematically address the issue of illicit financial flows.
The G8 and G20 have continued to urge countries to strengthen money laundering identification and the improve efforts to trace, freeze, and recover assets. This is reflected in the OECD publication that seeks to measure and combat illicit financial flows from developing nations that reach the “safe haven” of the OECD banking system. The Financial Task Force’s Recommendation 8 further requires that the laws and regulations governing NGOs be reviewed to prevent the abuse of these organizations to finance terrorism. Combating illicit financial flows is a particularly critical mission for developing nations since this type of capital flight deprives fragile economies of their national wealth and resources. Strengthening a country’s defensive capabilities against illicit financial flows does not and should not necessitate a restriction against the freedom of organization. Kenya’s sweeping action against NGOs, under the guise of anti-terrorist financing operations, is little more than a restrictive attack by a repressive government.
Kenya has had a tempestuous relationship with its NGOs. While running their election campaigns, political leaders Uhuru Kenyatta and William Ruto criticized the NGO community for relying on funding from outside sources in pursuit of interests that opposed Kenyan national interests. After a conference in 2011, Ruto stated that NGOs should stop interfering in government matters, as it was not their business. This distrust of foreign funding is reflected in Kenya’s philanthropic environment. In the Center for Global Prosperity’s Index of Philanthropic Freedom, which compares nations on their enabling environment for philanthropy, Kenya ranked in the lower half of African countries surveyed and below the majority of the countries in the study. In the Index, Kenya received its lowest score in the treatment of cross border funding, a fundamental part of NGOs working in the developing nation
While it is good news that the decision to revoke the registration of a vast number of NGOs was prevented from taking effect, it is important that Kenya’s continued pursuit of illicit financial flows gains some clarity. Preventing a mass deregistration may have kept Kenyan NGOs open but it did not ensure their freedom. Two of the organizations that were suspended in April after being accused of supporting al-Shabbab were only recently granted access to their assets. Muhuri and Haki Africa, two human rights organizations working to counter violent extremism in Kenya, faced financial and work holds following this accusation. In June, the organizations were removed from the list of accused organizations, but their accounts remained frozen. It was not until November 12, after ruling that the government did not provide sufficient evidence linking Muhuri and Haki to terrorist activities that both NGOs were granted access to their funds by Kenya’s High Court. While the decision to lift the hold was well received, the protection of NGOs should not be an after-the-fact attempt to bring back to life falsely accused organizations. If Kenya is to combat the infection of terrorist financing, it must prioritize the scalpel over the sword or risk killing its NGOs.