Weed out corruption among dubious NGOs

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It is frightening to hear of certain NGOs claiming to carry out charity work or welfare projects only for the money raised to be allegedly misused, Ambigapathi Samarasan writes.

In recent years, there seems to be a trend to set up NGOs in Malaysia. 

What is disturbing is that some of these NGOs are apparently formed merely to obtain funding from government departments and agencies, MPs and state assembly members. 

Some of these NGOs reach out to wealthy individuals and large companies for funds in the name of charity or religious activities. Sometimes, a person may form an NGO and then lead the organisation after which he or she would handpick the members to be on the committee.

I had an ‘interesting’ experience with one such NGO, which was a sports club. Someone I know had by chance become the president of the club. This person, instead of running the organisation as a sports club, decided to turn it into a charity. The reason, he pointed out, was that it is easier to raise funds for charities than it is for sports clubs. 

Over a period, the president was able to apply for and obtain a large sum from a government department to carry out some social activities for the local people.

When the time came for the NGO’s annual general meeting, the accounts that were prepared did not disclose the money received from the government department. 

As a concerned member, I asked for an explanation only to be told that the funds received were not meant for the club.

So I wrote to the government department to verify what had taken place. 

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I received a reply saying the money had in fact been given to the organisation. 

I then asked the president to show me the bank statements, but he was slow to respond. 

In view of the president’s reluctance to show me the bank statements, I decided that it was only prudent, for the sake of accountability, to report the matter to the Registrar of Societies. 

It took nearly a year for the RoS to investigate and eventually deregister the organisation due to inaccurate and incomplete accounts being submitted. 

Later I received a message from the president threatening to sue me for false information. However, he did not pursue the matter. 

I have written to specific government departments to be more careful when allocating funds to NGOs as sometimes funds received by irresponsible organisations end up in someone’s pocket. 

I have also written to state assembly members and MPs to stop giving funds to rogue or dubious NGOs. However, there was one MP who, despite my writing to warn him that this NGO was under investigation by the RoS, went ahead anyway and provided some funding to the group.

It is frightening to hear of NGOs claiming to carry out charity work or welfare projects only in name, but the money raised is then misused. The reason this abuse can take place is that often donors do not check on the NGOs.

Moreover, these NGOs are sometimes not required to report back and account for how the funds are used. As for the funds provided by donor departments, these are public funds so these departments are not really bothered about how the money is spent. 

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The RoS must intervene to curb this abuse. It has to scrutinise the accounts submitted to it every year. It must ask for copies of bank statements as well.  

For larger NGOs, accounts must be prepared and audited by recognised accounting firms. If falsification of accounts, fraud or abuse is suspected, the RoS must suspend the registration and – if foul play is later confirmed – deregister the club. The RoS should then lodge a police report and request the Malaysian Anti-Corruption Commission to investigate. 

The RoS has to impose on NGOs a yearly renewal fee of, say, RM100 so that it can commit resources to vet their accounts thoroughly.

I suspect quite a few religious organisations are not submitting proper accounts to RoS. Perhaps they have found a loophole as they know the RoS does not check the accounts thoroughly? 

I hope the RoS can conduct a workshop to train and educate the leaders of NGOs, especially organisations that collect substantial donations, about the importance of transparency and accountability.    

Ambigapathi Samarasan took part in an Aliran writers’ workshop with the theme “Writing for Change in New Malaysia” last year  

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Steven
Steven
15 Jun 2020 9.23am

Why not establish a Commissioner of Charity along the lines of what Singapore is doing?