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Compliance Issues after September 2001

International grantmaking has always had unique compliance and legal requirements. After the tragedy of September 11, 2001, however, the U.S. government established new regulations with respect to global philanthropy:

  • Executive Order 13224 (2001) prohibits transactions with individuals and/or organizations identified as terrorists or associated with terrorism. It freezes all property of such persons and those who assist them.
  • USA Patriot Act (2001) expands criminal sanctions for those who provide material or financial support to terrorists and foreign terrorist organizations. It also permits civil action to be brought against those who violate the provisions.
  • Treasury Department Anti-Terrorist Financing Guidelines: Voluntary Best Practices for US-Based Charities (2002) provides guidance to legitimate institutions on how to avoid legal penalties.

Tides Foundation approaches all grantmaking with rigorous attention to these guidelines and regulations.

Challenges and Concerns

Granting in other countries is often challenging. It takes time and resources to conduct due diligence on grantees to determine if the appropriate infrastructure is in place to ensure that funds are used for charitable purposes and that all government compliance requirements are fulfilled.

Charitable foundations share the U.S. government’s goal of eliminating terrorism. However, it should be understood that the government is best equipped to identify and monitor terrorists. Important relationships can be jeopardized if grantees perceive a charitable foundation to be an agent of the U.S. government.

Tides Foundation’s mission-driven grantmaking approach necessitates funding groups that work in areas of conflict. We cannot be discouraged from making international grants because the need for international funding is greater than ever.

To learn more about how Tides Foundation can help with your international giving, please contact us at 415.561.6400 or info(at)tides.org.